- Upward of 50,000 Arkansans could lose Medicaid under the state's work requirement pilot, according to data in an amicus brief filed last week in federal court.
- Since the demonstration was implemented in June, more than 8,000 people have lost Medicaid coverage "with no hint of objective evaluation," the brief says. It was filed by 40 public health scholars in support of three Arkansas Medicaid beneficiaries who are challenging the federal government's approval of the program.
- Gresham v. Azar seeks to halt the work requirement experiment on grounds it runs counter to Medicaid law and risks the health of Arkansas' most vulnerable citizens. The lawsuit was lodged in September in the U.S. District Court for the District of Columbia.
The Trump administration has been actively encouraging work requirements, and CMS announced in January that it would accept state Medicaid waivers that include work requirements as a condition for eligibility. In guidance to state Medicaid directors, CMS said work programs should exempt certain populations, such as people with disabilities, and consider issues like substance abuse and regionally high unemployment rates.
Indiana, Wisconsin and New Hampshire have also received the green light to begin work demonstrations and are set to launch in January. Some 10 more states have applications pending to impose work requirements.
A federal judge invalidated Kentucky's work mandate in July, questioning whether the state had considered the program's potential impact on Medicaid goals and the health of its population. Kentucky was the first state approved to test work requirements.
Arkansas was the first state to use a demonstration waiver to link Medicaid eligibility to meeting work or so-called community engagement requirements. CMS approved the state's Section 1115 waiver request in March and it took effect June 1.
Data presented in the amicus brief suggest that at the end of one year, between 19% and 30% of the 161,000 people subject to the Arkansas work requirements — or between 30,700 to 48,300 — will lose Medicaid coverage.
"What's at stake in this litigation is the ability of the state of Arkansas to provide significant federal funding to cover its able-bodied, nonelderly adults who became eligible under the Affordable Care Act for Medicaid coverage based on their income," Phillip Escoriaza, counsel for Feldesman Tucker Leifer Fidell LLP, which is representing the amicus filers, told Healthcare Dive.
Currently, the federal match for Medicaid funding is 93%, and that will drop to 90% by 2020. If thousands of people lose coverage, the state will lose those matching funds. "So it's very illogical for the state to pursue a work requirement for this population in Medicaid because there is really nothing to be gained from it," Escoriaza said.
The case is the first opportunity a court has had to decide whether there is a legal reason to halt work requirements. The plaintiffs contend the work requirement has no basis in Medicaid law. "There is nowhere in the Medicaid statute where it says a state can impose a work requirement as a condition for eligibility, and there's nothing in the Medicaid statute that says that the federal government may allow a state to create that requirement," Escoriaza said.
Last week, members of the Medicaid and CHIP Payment and Access Commission wrote HHS Secretary Alex Azar urging him to pause Medicaid disenrollments in Arkansas under the waiver until adjustments are made to ensure fairness and compliance with Medicaid requirements. The letter also called on HHS to work with states to ensure they provide ample time between waiver approval and implementation for enrollees to understand their new responsibilities vis à vis coverage.
MACPAC points out Arkansas disenrolled 8,462 residents because they failed to report work and community engagement activities. The group wrote: "The low level of reporting is a strong warning signal that the current process may not be structured in a way that provides individuals an opportunity to succeed, with high stakes for beneficiaries who fail."
A recent Kaiser Family Foundation report found numerous problems with the Arkansas program, including lack of awareness and compliance challenges. For example, agencies often lack accurate phone numbers for outreach, and when found many people still can't be reached. Online campaigns such as email and social media are stunted because many beneficiaries lack computers or internet access.
Other states will be watching the outcome for Arkansas as they consider implementing work requirement programs. Three predominantly red states — Idaho, Nebraska and Utah — voted to approve Medicaid expansion in last week's midterm elections, bringing the total to 36 states and the District of Columbia. The work waiver option may have helped to move them over the line.