Dive Brief:
- Most states are planning to adopt less restrictive policies to verify compliance with Medicaid work requirements, but some will check eligibility more frequently or put the policies in place earlier than required, according to a new survey published by KFF and the Georgetown University Center for Children and Families.
- For example, 39 states said they’ll implement the requirements — which mandate many beneficiaries log work, education or volunteer hours to stay enrolled — on Jan. 1, as mandated by the “Big Beautiful Bill” passed last summer. However, Iowa and Montana plan to adopt the policies this year, according to the report, and Nebraska has already debuted its work requirements.
- Twenty-nine states said they’ll use at least one optional hardship exemption from work requirements, like exceptions for people who live in counties with high unemployment rates or areas recovering from natural disasters. Only two said they wouldn’t use any optional hardship exemptions.
Dive Insight:
The survey offers a snapshot of how states are preparing for the impact of the massive tax and policy legislation signed into law last summer, which included significant cuts to the safety-net insurance program Medicaid.
One of the law’s major changes mandates work requirements for around 20 million beneficiaries enrolled under Medicaid expansion. Under the law, many enrollees will have to report at least 80 hours of work, education or volunteer hours each month to stay covered under Medicaid.
Now, states are working to put the infrastructure in place to check beneficiaries’ compliance with the new requirements — a significant undertaking for Medicaid programs, experts say. Only two states have previously fully adopted a Medicaid work policy, and research has found the mandates were costly to implement and didn't increase employment.
Meanwhile, states have limited time before the policies are required to go into effect, and they’re awaiting more guidance that the CMS is expected to release in June.
“That information is coming awfully late for states to be able to get all of the pieces in place and working well by Jan. 1,” Jennifer Tolbert, deputy director of KFF’s program on Medicaid and the uninsured and director of state health reform, said during a webinar Thursday.
Still, states are moving ahead with their plans, though not all have finalized their policies, according to the report, which included a survey of Medicaid officials from 43 states and focus groups with officials from nine states.
Thirty-four states said they would verify compliance with work requirements every six months at renewal, while two — Indiana and New Hampshire — reported they’d check that beneficiaries are meeting the requirements quarterly. Seven states hadn’t yet made a decision.
Additionally, 36 states will look back one month at enrollee information when they apply for Medicaid to verify compliance with the work requirements. Indiana and Idaho will look back at three months worth of data to verify compliance.
States’ plans for Medicaid work requirements begin to take shape
Most states plan to add new questions to Medicaid applications and renewals to help check whether beneficiaries are meeting the requirements. They’ll also continue to use existing data sources — like wage information, food assistance benefits and state unemployment data — to check for compliance and lessen administrative burden on Medicaid programs and enrollees.
Most states said they’d work with existing vendors to make changes to their eligibility systems, since the implementation timeline is too short to contract with new companies, according to the survey. Plus, six states are planning to use artificial intelligence to handle tasks like improving data matching and providing support for eligibility staff.
Managing their workforces is a concern for several states. Fourteen said they would take action to increase the capacity of their eligibility staff to handle work requirements, including nine that want to hire new workers and seven that plan to bring on contractors.
It’s not surprising that states couldn’t commit to hiring new workers yet, since their legislatures will likely have to appropriate funds for staffing changes, said Kate McEvoy, executive director of the National Association of Medicaid Directors, during the webinar.
“I think we see a lot of evidence across the country that states are very conscious of the need to increase capacity so they can be responsive to people who need help,” she said.
