Five states sue over Medicaid rule barring union dues payroll deductions for home health care workers

On May 13, attorneys general in five states – California, Connecticut, Massachusetts, Oregon, and Washington – filed suit in U.S. District Court against the U.S. Department of Health and Human Services (HHS). They seek to overturn an HHS final rule, issued May 6 barring states from making Medicaid payments to third parties on behalf of individual home health care providers. The rule applies to voluntary payroll deductions made to pay union dues    

  • Who are the parties to the suit? The plaintiffs include the attorneys general for California, Connecticut, Massachusetts, Oregon, and Washington (Xavier Becerra, William Tong, Maura Healey, and Ellen Rosenblum, respectively). Oregon Governor Kate Brown also joined the suit as a plaintiff. The defendants are the U.S. Department of Health and Human Services and its secretary, Alex Azar.
    • Political context: In all five states, the attorneys general are Democrats. Four of the five states – California, Connecticut, Oregon, and Washington – are Democratic trifectas (in Massachusetts, a Republican controls the governorship, but Democrats control both chambers of the state legislature).
  • What are the responses?
    • In their initial complaint, the plaintiffs said, “[The] Final Rule would undermine laws and agreements that have improved the provision of homecare to the States’ residents. It would disrupt well-established collective bargaining relationships and weaken an organized workforce infrastructure that the States have authorized as a result of provider self-organization and in order to channel labor relations in a productive and cooperative manner that contributes to the building, training, and mobilization of Medicaid homecare workforces.”
    • In commentary accompanying the complete text of the final rule, the Centers for Medicare and Medicaid Services said: “This rule merely forecloses the ability of a practitioner to assign a portion of his or her Medicaid payment to a union. However, other means remain available. A provider may voluntarily agree to automatic credit card or bank account deductions to pay for union dues once 100 percent of reimbursement has been received.”
  • The case, California v. Azar (case number 4:19-cv-02552), was filed in the U.S. District Court for the Northern District of California.


The big picture

Number of relevant bills by state: We are currently tracking 100 pieces of legislation dealing with public-sector employee union policy. On the map below, a darker shade of green indicates a greater number of relevant bills. Click here for a complete list of all the bills we’re tracking.

Number of relevant bills by current legislative status:

Number of relevant bills by partisan status of sponsor(s):

Recent legislative actions

Below is a complete list of legislative actions taken in the last week. Bills are listed in alphabetical order, first by state then by bill number.

  • California AB314: This bill would require employers to grant employees paid time for certain union activities.
    • Assembly Appropriations Committee hearing May 16.
  • Oregon HB2016: This bill would require public employers to grant paid time to employees participating in certain union activities. It would also require employers to furnish unions with access to employees.
    • Senate Workforce Committee work session scheduled for May 21.
  • Oregon HB3009: This bill would require public employers to provide unions with access to new employees. It would also permit individuals who are not members to make payments in lieu of dues to unions.
    • Senate Workforce Committee work session scheduled for May 23.