Roosevelt Institute | Cornell University

Medicaid Work Requirements Provide Reasons for Concern

By Isabella HarnickPublished June 18, 2018

The Trump Administration has recently decided to allow states to impose work requirements for Medicaid enrollees in an effort to incentivize work. However, incorporating work requirements can undermine its intended goal and threaten the coverage of millions of Americans

Medicaid is as big as it has ever been with 75 million Americans receiving coverage from this program. However, with the Trump Administration deciding to allow states to limit Medicaid coverage by imposing work requirements, coverage is likely to decline for millions of Americans. Three states—Kentucky, Arkansas, and Indiana—have passed such a policy so far, and ten other states have proposals waiting to be approved by the Center for Medicare and Medicaid Services (CMS). Data from states that have already passed such legislation points to work requirements as an inadequate means of incentivizing work.

The group most obviously threatened by the imposition of work requirements are the 40 percent of Medicaid enrollees who are not already working. However, since 80 percent of this group are unemployed due to an illness, disability, caregiving responsibility, or school enrollment, the majority of this population is supposed to be exempt from any work requirements imposed by their state. While the administration has outlined this intention of protection, it does not ensure sturdy means of protecting our nation's most vulnerable population. The guidance seems to merely suggest, not mandate exclusion, which calls into question whether this population will actually be safe from a loss of healthcare coverage that it so readily relies on.

However, even if the states were to adequately protect this vulnerable population, it still leaves 25 million enrollees who would be subject to work requirements. This still calls for concern considering that the Budget and Policy Priorities, a non-partisan research institute, concluded that poorer people who are currently working might also lose their healthcare coverage due to irregular work hours and sporadic lapses in employment. This problem was seen in Kentucky: One in four enrollees who were subject to Kentucky's work requirements fell short of the 80-hour monthly requirement, resulting in loss of their healthcare coverage for periods of time.

While CMS provides for further well-intended exceptions on the basis of high unemployment, because of varying demographics, African Americans could be disproportionately more likely to be subject to work requirements. The reason for this lies in that White Americans are more likely to live in rural areas with less robust job opportunities and social services. The fact that minorities are more likely to live in cities places a higher burden on them to find stable jobs in order to ensure their healthcare coverage.

The other problem with work requirements is the paperwork required to fulfill them. Working individuals who are satisfying the requirements could still lose coverage due to failing to file paperwork. Even if states try to make the process simple and easy by means of the internet, there are many individuals who will not have access. This was seen in Kentucky, where 19 percent of Medicaid enrollees have no access to the internet. Paperwork should not come in between a person and their access to healthcare.

Evidence suggests that giving people healthcare coverage helps them to obtain and keep stable jobs. This beneficial role of Medicaid coverage was seen in Ohio with three-quarters of beneficiaries who were searching for work saying that Medicaid made it easier for them to gain employment, and more than half of enrollees who were currently working stating that Medicaid helped them to keep their jobs. Therefore, rather than promote employment, work requirements could prevent it.

States like Virginia have been using work requirements as a bargaining chip for Medicaid expansion; however, given that adding work requirements can undermine its intended goal and threaten the coverage of millions of Americans, Virginia and other states should be wary when considering adding work requirements.