Jan 22

Jan 22 Analyzing Medicaid Work Requirements By Nicky Riordan

After the tax overhaul in December GOP Congressional leaders indicated that welfare reform would become a priority. The immediate focus is Medicaid, a $530 million assistance program that serves 70 million people, half of whom are children, making it the largest government insurance program in the country.

As Sarah Handley-Cousins explains, “the idea that charity enables perfectly healthy, lazy people to live off the toil of hard-working citizens has been around far longer than federal entitlements. Indeed, the idea was already so deeply held that even the federal pension system, created to support sick and wounded Union veterans in the wake of the Civil War and arguably the first American welfare program, was designed to prevent creating a population of dependents.”

At the same time, Candidate Trump stated in 2015 that: "I'm not going to cut Social Security like every other Republican, and I'm not going to cut Medicare or Medicaid,” The president’s first budget proposal, released last spring, sought to do so with cuts “hitting his own voters hardest.”

The Trump administration recently released a letter to state Medicaid directors encouraging “state efforts to test incentives that make participation in work or other community engagement a requirement for continued Medicaid eligibility.” The idea to impose work requirements for Medicaid eligibility is not new, but federal support of such policies is.

Several states have explored the idea since the passage of The Affordable Care Act in 2010. The Obama administration signaled little to no interest for such requests. Ten states have currently submitted waiver requests to impose work requirements on Medicaid eligibility. Kentucky was approved last week and becomes the first state to implement such a policy.

There is some historical precedent in U.S. government. Similar reforms were made to the Aid to Families with Dependent Children (now Temporary Assistance for Needy Families- TANF) program just over 20 years ago. Caseloads decreased as expected, but most likely not for the reasons that work requirements claim to target. The number of families living in poverty rose to historically high levels during the Great Recession while TANF recipients fell to pre-recession levels.

The addition of work requirements to the Medicaid program could increase the burden on state agencies who administer such policies. More verification will be needed to ensure that those who cannot work have sufficient documentation and that those who can are submitting proof of work or are enrolled in appropriate job training programs. States will also be required to prove they are providing assistance to Medicaid recipients looking for work or job training programs.

The Kaiser Family foundation found that 60 percent of able-bodied Medicaid enrollees are already working. The reasons another 32 percent are not include disability, caregiving, and attending school. The remaining 7 percent are the presumable target of these reforms.

Democratic opposition has quickly emerged. 29 Democratic Senators wrote a letter to acting Secretary of Health and Human Services Eric Hargan. They asked the Trump administration to reconsider and argued that work requirements are illegal because the requirements “clearly undermine the purpose of the Medicaid Act, prioritizing ideology over health.”

Barring legal setbacks, this will likely be a policy development worth watching, particularly in more politically conservative states, whom also typically depend most on federal assistance programs.

Nicky Riordan (@nriordan120), Political Analyst, Utica College Center of Public Affairs and Election Research