- The Centers for Medicare and Medicaid Services on Thursday confirmed it will accept state Medicaid waivers that include work requirements as a condition for eligibility.
- In a 10-page letter to state Medicaid directors, the agency issued guidance for states seeking such waivers. It said states should exempt certain populations, such as people with disabilities, and should consider issues like substance misuse and regionally high unemployment rates.
- At least ten states are considering section 1115 Medicaid waivers that require enrollees to have a job, train for a job or participate in community activities like volunteer work.
The move is a major shift in policy, but not a surprise for the Trump administration. The CMS under President Obama would not consider these waiver types for approval, but new leadership has encouraged such an approach, which is now finalized.
The waivers with work requirements will still see heavy political pushback, and there will probably be legal challenges.
Nearly eight in 10 adults in Medicaid are already in working families, and most are working themselves, according to the Kaiser Family Foundation.
The work requirements “could have negative implications on many who are working or exempt from the requirements. For example, coverage for working or exempt enrollees may be at risk if enrollees face administrative obstacles in verifying their work status or documenting an exemption,” the foundation said in a recent policy brief.
While supporters of work requirements say they could encourage more people to get off Medicaid and promote personal responsibility, opponents say such policies would take coverage away from those who need it most – and add to administrative burden and complexity.
CMS Administrator Seema Verma said in her letter that employment and higher earnings are associated with improved mental health and overall wellbeing.
“CMS recognizes that a broad range of social, economic, and behavioral factors can have a major impact on an individual’s health and wellness, and a growing body of evidence suggests that targeting certain health determinants, including productive work and community engagement, may improve health outcomes,” she wrote.
But adding work requirement to Medicaid eligibility is strongly opposed by patient advocacy groups and a number of policy analysts.
A Health Affairs analysis found that if work requirements were applied to Medicaid nationwide, 11 million enrollees would be at risk of losing coverage.
LaDonna Pavetti, vice president for family income support policy at the Center for Budget and Policy Priorities, said in a recent blog post the evidence “shows that work requirements won’t move people out of poverty and eliminate their need for health coverage.” The policies do not lead to sustained and stable employment or improved financial status, and voluntary programs can boost employment without the result of millions getting kicked off the rolls, she wrote.