States say a holdover proposed rule to change the Medicaid and CHIP appeals process would require a change in state laws to implement it. The rule was proposed by the Obama White House that could still be approved by the Trump administration.

The CMS issued the policy last November in an effort to modernize and align Medicaid appeals processes with other health coverage programs such as Medicare and marketplaces established under the Affordable Care Act. The rule overhauls how consumers can request appeal hearings and how the state processes those requests. It also proposes technical and minor changes determining eligibility and granting appeals. Comments on the rule were due Jan. 23.

Debra McCurdy, senior health policy analyst at the law firm ReedSmith said in a client alert about the proposed rule that implementation of ACA-related regulations will be tied to the broader fate of the ACA under the Trump Administration and Republican Congress.

Leaders of both red and blue states argue the rule is an example of micromanaging. They say states should determine how appeals are handled. Given Trump and HHS Secretary nominee Rep. Tom Price (R-GA) want to give states maximum flexibility in overseeing their Medicaid programs, its likely they will not move forward with the rulemaking.

State officials say there’s nothing wrong with their current appeals processes that have been in place for decades.

MaryAnne Lindeblad, Washington state’s Medicaid director said in a comment to the CMS that her state would have to work with state legislature to change a long-standing law on the appeals process.

The rule was also criticized by the National Association of Medicaid Directors, and state officials from Alabama, California, Massachusetts, South Dakota, Vermont, Wisconsin and others.

The CMS, however, felt the impact of the rule, both fiscally and administratively, would be minimal.

Patient advocates support the rule. The National Health Law Program said it provides applicants and beneficiaries with additional protections.

If the CMS under a Trump administration chose to kill the rule, the earliest they could do it is late March as there is now a 60-day freeze on new rulemakings.