CMS on Friday approved Medicaid work requirements for Arizona, which will be the eight state to put the enrollment restrictions in place.
The state's Arizona Health Care Cost Containment System Works program will require people to have a job, get employment training or participate in community service to be eligible for Medicaid. The requirement is expected to start in 2020.
The Section 1115 Medicaid demonstration project will exempt federally recognized tribe members from the requirement.
Proponents of Medicaid work requirements see the policy as a way to get people to work and reduce the size and cost of the program. States have increasingly sought ways to bend the Medicaid cost curve.
A recent HHS Office of the Actuary report projected Medicaid expenditures to grow at an average annual rate of 5.7% over the next decade. That's faster than the gross domestic product. Fitch Ratings said last year that rising Medicaid costs may force state and local communities to cut spending on other programs, such as education and public safety.
Instead, some states are looking to restrict who has access to Medicaid.
The Arizona work requirement will require people between 19 and 49 to "engage in qualifying community engagement activities for at least 80 hours per month and report monthly that they are meeting the community engagement requirements."
The state will exempt pregnant woman, beneficiaries who are medically frail and those in active treatment for substance use disorder.
The work requirement is expected to impact about 120,000 Arizonans.
CMS Administrator Seema Verma said the waiver gives states the flexibility to tailor a program to fit their needs. Republican Gov. Doug Ducey said in a statement the requirement will improve health outcomes and employment opportunities.
Arizona's waiver follows other states' work requirements, which were celebrated by conservatives and derided by liberals. Kentucky was the first to receive a work requirement Medicaid waiver, but a federal judge rejected the rule. Kentucky proposed a similar second work requirement plan and CMS approved that option. However, that rule is being challenged in court as well.
Arkansas also received a work requirement, but Verma said she will review the impact of the change after more than 12,000 people lost Medicaid coverage.
Those wrinkles haven't stopped other states from exploring work requirements. CMS is reviewing similar requirements for another eight states: Alabama, Mississippi, Ohio, Oklahoma, South Dakota, Tennessee, Utah and Virginia.