Despite the Trump administration’s desire to force some Medicaid beneficiaries to work to maintain their benefits, a federal judge has thrown a monkey wrench into the plan by ruling against work requirements in Kentucky and Arkansas. The ruling comes in the wake of a Kaiser Family Foundation issue brief that found thousands of recipients in Arkansas have lost coverage because they failed to comply with the work requirements.
U.S. District Court Judge Boasberg, who previously ruled against Kentucky’s plan, last week once again blocked the Bluegrass State from implementing its program and Arkansas from continuing its program, casting doubt on the future for other states that want to make employment a requirement as part of receiving Medicaid coverage.
Last year the Centers for Medicare & Medicaid Services (CMS) issued a new policy to support states that test incentives to make work a requirement for continued Medicaid eligibility or coverage as part of demonstration projects authorized under section 1115 of the Social Security Act. Kentucky was the first of eight states to receive federal approval to test the work requirement. Seven states have also submitted work requirements waivers, but the federal government has yet to issue a verdict on those requests.
In his rulings, Boasberg indicated that the Arkansas and Kentucky projects don’t consider the core objective of the Medicaid program, which is to provide medical coverage to the needy.
But CMS Administrator Seema Verma said in a statement that the agency would continue to support state efforts that test reforms that aim to advance the objectives of the Medicaid program and will defend programs that “give states greater flexibility to help low-income Americans rise out of poverty.” True to her word, CMS moved ahead and on Friday approved Utah’s Medicaid work requirements—two days after the judge’s ruling.
A recent Kaiser Family Foundation issue brief that looked at February data of the Arkansas Medicaid work requirements found that 18,164 individuals lost coverage in 2018 due to failure to meet the work and reporting requirements, and few have regained coverage in 2019. Unless they are exempt, Arkansas Medicaid recipients must work 80 hours each month under the plan. Only 11 percent of those who lost coverage in 2018 have reapplied and regained coverage in 2019. The brief noted that administrative burdens on eligibility and enrollment, such as having to reapply to regain coverage, has led to some eligible people to remain unenrolled.
In an interview with NPR, Arkansas Gov. Asa Hutchinson said the goal of the program was not meant to have Medicaid beneficiaries lose health coverage. Instead, it was meant to help those who were able to get to work and have an income. He said the state will appeal the decision because lawmakers believe in the “fundamental principle of a work requirement, a community engagement requirement.”
Kevin Mowll, executive director of RISE, said that while the work requirements may be a well-intended idea to help certain people find gainful employment, research shows that the majority of Medicaid beneficiaries are truly entitled to coverage without work requirements. The problem is that many of these individuals are too mentally fragile to navigate new bureaucratic reporting requirements to maintain their health coverage.
“These low-functioning individuals become victims of the new work requirement policy, losing eligibility and falling through the cracks. That seems to be the practical reality of the work requirement waiver. So there is a disconnect between health policy and the real world,” Mowll said.
Libby Hinton, MSPH, senior policy analyst with the Kaiser Family Foundation will be a featured speaker at RISE’s Medicaid Managed Care Leadership Summit, April 29-30, at The Standard Club in Chicago. She will use the Arkansas work requirements as a case study to discuss potential outcomes of the program. The status of Medicaid work requirements also will likely be a discussion point during the CEO roundtable that will kick off the summit.