CMS Tells States How to Require Work for Medicaid

The long-awaited guidance allows states to seek waivers that require able-bodied adults to show they are working, receiving education, serving as a caregiver, volunteering, or receiving substance abuse treatment in order to be eligible for Medicaid.

Republican governors today received something they’ve sought for years: guidance on how to require work from able-bodied people collecting Medicaid, which could be the last barrier to expansion for some of the 19 states that have thus far declined to extend the program under the Affordable Care Act (ACA).

CMS today issued a guidance on how states can require work, community service, education, or time in substance abuse treatment in exchange for receiving Medicaid benefits among those adults who are eligible for Medicaid for reasons “other than disability.” The ACA expanded eligibility to those earning up to 138% of the federal poverty line, but the Supreme Court of the United States left decisions up to individual states.

Elements of the guidance include:

  • States can require able-bodied adults to show they are working, but will have the flexibility to allow community service, caregiving, education, or substance abuse treatment to be eligible activities.
  • States must show they are not discriminating against people with disabilities, and a letter to states says they must “take certain steps” to ensure that people with opioid addiction are protected and receive treatment.
  • States must clearly define which groups would be included in a waiver for a demonstration. “CMS recognizes that adults who are eligible for Medicaid on a basis other than disability will be subject to the work/community engagement requirements,” the letter stated, and states will have to show how they are resolving their rules with a person’s disability status under federal law.
  • Within 6 months of being granted a waiver, states must show how they will study the health outcomes of work requirements on those affected by the new rules.

“Medicaid needs to be more flexible so that states can best address the needs of this population,” CMS Administrator Seema Verma said in a statement. “Our fundamental goal is to make a positive and lasting difference in the health and wellness of our beneficiaries, and today’s announcement is a step in that direction.”

Kentucky is expected to be one of the first states to act under the guidance, as Republican Governor Matt Bevin has sought a waiver that seeks work or community service requirements for those receiving Medicaid. Under former Democratic Governor Steve Beshear, Kentucky saw one of the nation’s steepest drops in the uninsured rate through a home-grown exchange called Kynect that enrolled more than 500,000 people.

Other states that the CMS statement says are expected to take advantage of the guidance are Arkansas, Indiana, Kansas, Maine, New Hampshire, North Carolina, Utah, and Wisconsin. Some have Medicaid expansion and others do not.

The guidance calls for states to align requirements with those that may already exist for beneficiaries to receive other assistance, including the Supplemental Nutrition Assistance Program (SNAP). In doing so, the guidance suggests the process will be easier on recipients.

However, healthcare advocates have long sought to draw a bright line between the relationship between healthcare benefits and other public assistance, arguing that no one should be denied healthcare because they are poor, and that, in fact, not addressing a person’s health needs makes it more difficult for them to find and maintain employment. These arguments defeated an early effort by former Pennsylvania Governor Tom Corbett to include work requirements in Medicaid expansion.

US Representative Frank Pallone, Jr. (D-NJ), ranking member of the House Energy and Commerce Committee, said today the action violates the Medicaid statute. “By allowing states to impose harmful work requirements, the Trump Administration is endangering the life support systems millions of vulnerable Americans rely on every day.”

Pallone pointed out that the waivers states will use to seek work requirements require states to show how they will expand access, not restrict it, which most experts have considered a key stumbling block to imposing work requirements.

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