Policy

More States Jump on Medicaid Work Requirements Bandwagon

Centers for Medicare and Medicaid Services Administrator Seema Verma, has signaled openness to approving work requirements for Medicaid. (Bill Clark/CQ Roll Call)

A growing number of mostly Republican-led states are rushing to follow Kentucky’s lead in requiring thousands of people on Medicaid to work or lose health coverage.

The governors of South Dakota, Alabama, Louisiana and South Carolina have said in recent weeks that they plan to pursue work requirements for their Medicaid programs, following the Trump administration’s release of guidelines for the concept in January.

“Whenever possible, we should always endeavor to help South Carolinians in need find their path to gainful employment and away from temporary assistance of government,” South Carolina GOP Gov. Henry McMaster tweeted Jan. 11, the same day federal officials announced the new guidance.

At least four non-expansion states, including Mississippi and Kansas, have already submitted formal work requirement proposals to the Department of Health and Human Services. They are among at least 10 states, including Indiana and Arkansas, to do so. The administration has only approved one proposal so far – in Kentucky, a state that expanded the government insurance program for the poor under the health law.

While proponents say work requirements are largely aimed at so-called “able-bodied” adults who gained coverage through Medicaid expansion, many of the states exploring the idea have not expanded the program under the 2010 health care law. And consumer advocates warn that puts at risk not just adults without kids but also poor parents, people with disabilities and children covered by traditional Medicaid.

Thirty-two states and the District of Columbia opted to broaden Medicaid under the law, extending coverage to millions of Americans — most of them adults without children with income of up to 138 percent of the federal poverty level. That’s roughly $16,800 for a single person in 2018.

Many of the non-expansion states considering work requirements already have some of the most stringent Medicaid eligibility requirements in the country. In Alabama, adults without children are barred from the program altogether; meanwhile, parents can only qualify if they earn no more than 18 percent of the federal poverty level, or less than $3,800 a year for a family of three, according to the nonpartisan Kaiser Family Foundation.

“These are parents living in the deepest poverty,” said Joan Alker, executive director of Georgetown University’s Center for Children and Families. “Very vulnerable people will lose coverage, including parents, and I expect children to also be harmed by these policies.”

Children are more likely to have health insurance if their parents do, Alker said. Plus, one medical emergency can lead to bankruptcy for poor families, she said.

“A healthier parent is a better parent,” she said.

Effect on People with Disabilities

Advocates also argue that people with mental and physical disabilities could also be hurt by work requirements in both states that expanded Medicaid and those that haven’t.

Many states with work requirement proposals exempt people who are “medically frail,” but what exactly that means is unclear and some people may have trouble getting the documentation to prove they aren’t healthy enough to work, said Judith Solomon, vice president for health policy at the left-leaning Center on Budget and Policy Priorities.

“There are large numbers of people who don’t meet that very strict category,” Solomon said.

Nationwide, roughly a third of nonelderly adults with Medicaid report having a disability, according to a Kaiser study. But despite having a serious health issue, nearly six in 10 of those individuals do not receive Supplemental Security Income, or SSI, cash assistance, the report shows.

In Alabama alone, an estimated 64,300 nonelderly Medicaid adults with a disability don’t receive SSI, according to Kaiser.

The impact of work requirements on people with disabilities will depend on a number of factors, including whether states will correctly identify and exempt people who can’t work and what types of support services they provide to help those with disabilities comply with the new standards, the report concluded.

The Trump administration and work requirement supporters say they believe the new rules will not only foster self-reliance among Medicaid enrollees but also improve their health.

“We believe that increased health security while participating in employment training programs will not only assist in promoting long-term success for the individuals but also their relatives for whom they are caretakers,” Mississippi officials stated in the state’s Medicaid proposal to HHS last fall.

Though proposals vary, most state work requirements would require adults who are working-age and able-bodied to participate in at least 80 hours a month of work, schooling, volunteering or another activity. Most also exempt pregnant women and people in substance abuse treatment, among others.

Work requirements will “improve quality, lower costs and deliver value” to Medicaid enrollees, Centers for Medicare and Medicaid Services chief Seema Verma said in a recent statement.

Kentucky plans to begin rolling out work requirements by region starting in July. The state estimates the move will reduce its Medicaid rolls by upwards of 95,000 people within five years.

Advocates have already sued the Trump administration over the issue, alleging it doesn’t have the authority to approve work requirements and that the changes don’t meet Medicaid’s objective of providing health care to low-income Americans.

More legal challenges are likely if federal officials approve similar requests in other states.

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