The letters went out to governors on March 14, 2017. Seema Verma had recently been appointed by President Donald Trump as the administrator of the Centers for Medicare and Medicaid Services, the agency within the Department of Health and Human Services that oversees health-care programs for more than 130 million Americans. Verma and then–HHS Secretary Tom Price, also a Trump appointee, wanted to alert state leaders across the nation that a new era was dawning: Some people would be required to work in exchange for Medicaid benefits.
Ushering in this new regime was, in some ways, what Verma had spent her entire career seeking to accomplish. In 2001, five years after earning a master’s degree in public health at Johns Hopkins University, Verma founded a consulting company called SVC. The company, which exists now as HMA Medicaid Market Solutions, helps states adjust how Medicaid programs are operated and delivered. (Verma sold the company shortly after becoming CMS administrator.)
In 2010, SVC took center stage in state-level Medicaid reform when the Patient Protection and Affordable Care Act—Obamacare—gave states the option of expanding Medicaid, with a hefty federal subsidy, to people making up to 138 percent of the poverty line. (The current poverty line is $12,490 per year for individuals and $25,750 per year for a family of four.) In Indiana, Verma partnered with Mike Pence, who at the time was the state’s governor, to implement an expansion program called the Healthy Indiana Plan 2.0. Among other things, the program instituted a system of premiums, ranging from $1 to $27 per month, for the new Medicaid-expansion population.