Medicaid Work Requirements Will Prevent People from Receiving Care

Medicaid Work Requirements Will Prevent People from Receiving Care

In January, the Centers for Medicare and Medicaid Services (CMS) issued a guidance which announced that states would be allowed to require work hours for certain people on Medicaid. This is a huge departure from what CMS has said before, and already Kentucky and Indiana (which had pending requests in at the time the guidance was released) have been approved to implement work requirements. However, there is a lot of research that shows that Medicaid work requirements will not raise people out of poverty, as CMS hopes. Instead, work requirements will lead to people falling off the Medicaid rolls (an estimated 95,000 people would lose Medicaid in Kentucky alone) because of inability to work, inability to find a job, and/or inability to complete the necessary paperwork.

Who is Affected and What They Would be Required to Do

The guidance released by CMS gives states the authority to “incentiviz[e] work and community engagement among non-elderly, non-pregnant adult Medicaid beneficiaries who are eligible for Medicaid on a basis other than disability.” Let’s define some terms from that sentence to work out what the states are now allowed to require:

A manufacturing worker squats on a board with his head down

  • “work”= the guidance does not give examples of what might be work and what is not, because each state defines work on their own. Generally, states define work as an activity that generates income. Governor Bevin in Kentucky hopes to require Medicaid beneficiaries to work 20 hours a week.
  • “community engagement”= the examples the guidance gives are skills training, education, job search, caregiving, or volunteer services, substance disorder treatment, and tribal employment programs. Again, states have a lot of leeway to pick and choose what they think counts as “community engagement.”
  • “non-elderly, non-pregnant adult Medicaid beneficiaries who are eligible for Medicaid on a basis other than disability”= this language targets people who came on Medicare after the Affordable Care Act (ACA) gave states the right to expand Medicare to individuals earning up to 138% of the federal poverty line. The majority of those people were newly able to enroll in Medicaid because they did not make enough money to pay for healthcare services, not because they were pregnant, disabled, or elderly. The guidance also lists exemptions to this group of people that states could (but do not have to) apply: exemptions for age, disability, responsibility for a dependent, or participation in a drug addiction or alcohol treatment and rehab program. And again, states have leeway to decide who meets this definition.

Bottom line? Low-income people who recently joined Medicaid because they couldn’t afford healthcare without it are now targets for work requirements, which could include working for income, or any number of state-specified community involvement.

Most Medicaid Recipients Who Can Work Already Do

A pie chart showing the work status and reason for not working for medicaid adults

The Kaiser Family Foundation found that six out of ten Medicaid adults are already working, and those that are not report that they are ill or disabled, are caregivers, or are in school. That leaves only a relatively small population of Medicaid recipients who would be subject to work requirements, and that they report that they are not working because they are looking for work and unable to find a job.

The CMS guidance cites TANF, or Temporary Assistance for Needy Families, as a guide to how work requirements may work out. Fans of TANF say that it helps people get out of poverty because it imposes work requirements. However, just like Medicaid recipients, TANF enrollees work regardless of whether they are required to do so, so the work requirement has little impact on increasing employment over the long-term. And TANF enrollees work in low wage jobs and remain poor despite being employed. We can expect to see the same effect if work requirements are imposed on Medicaid beneficiaries.

A bar graph showing the work status of medicaid adults

For Medicaid recipients who are able to work, there’s also a Catch-22 in play. For some, working at minimum wage could make them financially ineligible for Medicaid in states with low eligibility levels for adults. For those people, if they DO NOT work, they’ll be kicked off of Medicaid because of work requirements. If they DO work, they’ll be kicked off of Medicaid because they make too much income. Either way, they’re loosing essential coverage for health services.

The CMS guidance makes it very clear that states must show how they are helping people meet the work requirements, by implementing programs such as job training. The state can help those trying to find work and unable to through programs and outreach. However, states may not use federal Medicaid funds for job-search support services. It is not clear how states are supposed to pay for these programs.

Complex Documentation and Administration Processes Would Make People Lose Coverage

A man covers his face with a question mark above his head

Implementing work requirements for Medicaid enrollees would generate huge amounts of paperwork, for the government and for enrollees. Even if a Medicaid recipient was exempt from a work requirement program because they are disabled, elderly, a caregiver, or in school, they would still have to fill out paperwork to prove that status to the government. Those Medicaid recipients who are already working would also have to document their work and provide proof to the government. A Medicaid recipient could be following the rules perfectly and still lose coverage because of incorrect or late paperwork. Studies of both Medicaid and the Children’s Health Insurance Program (CHIP) show that complex enrollment rules and documentation result in barriers to coverage, and more people enroll in programs when the process is easy.

Additionally, the economic and administrative burden on states to process all this paperwork would be extensive. States would need to pay for staff, new systems to track both verifications and exemptions, and education for individuals to complete the new paperwork.

Working May Not Make People Healthier

The guidance supposes that when people work, they become healthier, based on many studies that show correlation between health and work. However, there is a difference between correlation and causation. There is not sufficient research to say that working causes better health. It could very well be the case that these studies show that healthy people are more able to work. In other words, it is not clear whether income and work lead to better health, or whether better health facilitates income and work.

A woman rubs her temples in an office

The guidance fails to take into account studies that show that work has negative impacts on health as well. The Kaiser Family Foundation writes that “research has found some deleterious health effects of work, particularly for people in shift work positions or those with high job insecurity, and evaluations of existing work requirements in other programs find weak evidence for an effect on health and well-being.” There are some studies that show positive effects of work in programs for working people with disabilities, but the work in these programs is voluntary, and there are plentiful support services for those people. That would not be the case for Medicaid work requirements as outlined by the CMS guidance.

What You Can Do

Medicaid work requirements would prevent people from enrolling in Medicaid and would force people out of the program. Medicaid is necessary for many low-income people in order to access medical care, and having fewer people enrolled means more people going without care. Already Kentucky and Indiana have received permission to implement work requirements and Maine, New Hampshire, Wisconsin, Mississippi, Arkansas, Kansas, Utah, and Arizona have applications pending.

If you live in one of the states that has been approved for a waiver or has an application pending, write or call your state delegates and tell them how Medicaid work requirements would hurt the people in your state!

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