5 Updates on Medicaid Work Requirements

In January, the Trump administration issued guidance for states that want to require work from able-bodied Medicaid recipients. Just a day later, Kentucky became the first state approved for Medicaid requirements. Since then, Arkansas, Indiana, and New Hampshire have each received CMS approval for their Medicaid work requirements, and 7 other states have bills pending .

As more states are in the works for introducing and passing work requirements and states with approved bills prepare to implement them, here are 5 updates to know about:

1. Arkansas becomes the first state to implement work requirements

Last week, Arkansas became the first state to implement work requirements for nonelderly, nondisabled Medicaid beneficiaries who don’t have dependent children at home. State officials say they are working with hospitals, health plans, social service agencies, county offices, and colleges to help those in the program to comply with the new requirement, Modern Healthcare reported.

The requirements will affect approximately 280,000 people in the state over the next 6 months and feature the strictest lockout seen so far. Those aged 19 to 49 years have to demonstrate that they have worked or engaged in job searches, training, school, health education, or volunteering for 80 hours per month. Those who fail to do so for 3 months in a year will lose coverage for the rest of the calendar year.

2. Virginia governor signs off on Medicaid expansion that includes work requirements

After a 5-year battle over expansion in the state, Governor Ralph Northam signed a 2-year, $117 billion budget that will expand health insurance coverage for up to 400,000 uninsured Virginians and require they seek employment.

Starting January 1, Virginians with incomes up to 138% of the federal poverty line will be able to enroll in Medicaid. Once approved by CMS, recipients of Medicaid will have to prove they are employed, studying, or volunteering. Requirements will start at 20 hours a month and slowly increase to 80 hours per month, according to TPM, a Washington, DC, news outlet. Similar to Arkansas, those who fail to comply for 3 months will be locked out of benefits until the following year.

3. Michigan House approves revised bill

A revised Medicaid work requirement bill is heading to the Michigan governor’s desk after passing in the House. The bill, which Governor Rick Snyder signaled he would sign, will require more than 500,000 adults, aged 18 to 62 years, to show 80 hours per month of workforce engagement through work, school, internship, substance abuse treatment, or community service, starting in 2020.

The revised bill has several changes from the original, including allowing for 3 months of noncompliance in a 12-month period, scaling back the work requirements from 29 hours a week, excluding traditional Medicaid beneficiaries, and letting community service count as a qualifying activity for no more than 3 months of the year.

4. Kentucky governor teams up with health foundation to help with Medicaid work requirements

In preparation of its roll out of Medicaid work requirements in July, Kentucky’s governor has partnered with the nonpartisan Foundation for a Healthy Kentucky to help residents in Kentucky fulfill the requirements and maintain their coverage. The organization will provide recipients with work and volunteer opportunities as well as help some pay their monthly premiums.

Kentucky’s 5-year demonstration project will require recipients age 19 to 64 to have at least 80 hours a month of working, going to school, taking a job training course, or volunteering. If they fail to meet the requirements, they will be locked out until they meet the requirements for 30 days.

5. Research institute says Medicaid work rules will increase uncompensated care costs for hospitals

Between 2013 and 2015, the country’s uninsured rate dropped from 14.5% to 9.4%. During the same period, there was a corresponding 30% decline of uncompensated care costs as a share of hospital operating expenses in all but 2 states.

A report released by The Center for Budget and Policy Priorities credited the Affordable Care Act for these results and said gains will be jeopardized once work requirements take effect. “Medicaid serves the most financially vulnerable, low-income patients who are least likely able to pay for medical bills when uninsured, thus leading to hospital uncompensated care costs,” the report states.

Another report from the institute said the new requirements will cause eligible people to lose benefits as a result of errors in documentation, confusing and time-consuming paperwork, and the problem of low-wage workers who are unable to compile enough hours to satisfy the requirements due to unstable hours or other factors beyond their control.