Medicaid Work Requirements Aren’t Really About Work

medicaid work requirementsMedicaid work requirements are a slight of hand, designed to misdirect anger and concern about rising health costs toward vulnerable people, hoping you won’t notice they don’t fix the actual problem. The Trump administration and some states are pursuing this approach  a new, and possibly illegal change for the program. This week, Kentucky was given federal clearance to institute work requirements, and the Centers for Medicare and Medicaid Services (CMS) sent a letter to all states encouraging the policy. According to the CMS director, the goal is to help people leave Medicaid and pursue “the American dream.” 

That’s not what Medicaid work requirements are about. As we’ve noted before, they demonize people, in particular “able-bodied adults,” by implying they are undeserving of health care and are universally to blame for high health spending. (The term “able-bodied” is rooted in one’s ability to work, and often serves as a proxy for adults in the Medicaid expansion population.) Research finds Medicaid work requirements would create coverage barriers for a small group of vulnerable people, largely because most people insured by Medicaid work already. Most expansion enrollees are more likely to be working than the general public.  

Colorado is not one of the states seeking to test work requirements, but some have advocated for ending coverage for able-bodied adults as a way to save our state money. This is a bad idea.  

About three-fourths of non-elderly, non-disabled Medicaid adults in Colorado are working. National data shows those who don’t work report pretty good reasons for not doing so: Over one-third have an illness or disability, nearly one-third are caregivers, and most others are in school, looking for work, or retired. (The CMS encourages state discretion in counting these activities as “work.” However, as one expert notes, all this flexibility creates ambiguity about what is permissible.) 

The Colorado Health Institute (CHI) notes it is difficult to estimate how many Coloradans would be impacted by a work requirement. However, descriptive data about Colorado’s expansion population reveal who could be hurt. According to the Colorado Department of Health Care Policy and Financing, most are adults without dependent children, nearly half are under the age of 35, and 40 percent are white. CHI shows expansion enrollees are concentrated in Denver, but also in the southern, rural parts of Colorado, though all counties have expansion enrollees. All make very little money — the income eligibility level is just over $16,000 for an individual.  

It’s true health costs stress our General Fund budget. But we’ve documented the biggest pressures facing state Medicaid and so did the Denver Post. It’s our aging demographics and rising health costs, not the newly-eligible working poor. Layering on additional bureaucracy dedicated to work requirement verification and compliance won’t help. As we urge in our new Guide to Economic Mobility, focusing on long-term care costs and heeding recommendations made by Colorado’s Commission on Affordable Health Care could.  

Although Kentucky’s proposal was just approved, we can already learn from in-state expertise. In August, researchers took the time to ask people on Kentucky’s Medicaid program what they thought about requiring work and premium payments as a condition for Medicaid. Focus group participants did not think the proposal understood their everyday realities, nor would they solve their problems — namely the difficult transition from Medicaid to private insurance, and the lack of affordable options. Their conclusion? Try to identify actual problems in our health system so we can focus on the best ways to fix them.