So far, it’s unclear how widely adopted work requirements will be and how exactly states will implement them under CMS’s new guidance. On Friday, Kentucky was the first state to have its 1115 waiver creating work requirements approved by CMS. On Thursday, Verma noted that nine other states had already submitted waivers asking the federal government to approve incentives or requirements for some Medicaid beneficiaries. In addition to allowing strict job mandates, CMS will also allow requirements for “other community-engagement activities,” including volunteering, job training, and caregiving. (These rules only apply to specific adults; CMS carves out people with disabilities, the elderly, children, and pregnant women.)
1115 waiver applications from Kentucky, Maine, and Wisconsin provide examples of what constraints on welfare programs might look like at their strictest. Kentucky’s—which Verma helped create when she was a health-care consultant—applies to all able-bodied non-elderly adults, and requires them to complete 80 hours per month of work, jobs training, education, or community service. It also requires recipients to pay an income-adjusted premium or risk losing coverage for up to six months. Wisconsin wants to require all adults without dependent children who live in poverty to work or complete community-engagement activities in order to qualify for Medicaid. Maine would require even some parents in poverty to work for their benefits.
Yet if states want work requirements to increase the health and self-sufficiency of Medicaid beneficiaries—their stated goal—most available data suggest they’ll fall short. As the Kaiser Family Foundation reported in 2017, most people on Medicaid who can work do work. Around 60 percent of adult enrollees have a job, and for the most part those who don’t report impediments in their ability to work. Even those who are not officially disabled often attest to having debilitating conditions—like severe back problems—that make full-time jobs difficult or impossible. Others may be in school, work as primary caretakers for loved ones, or may have retired.
Instead of spurring employment among the sliver of people left able and wanting for jobs, it’s more likely that the requirements will simply push those people who can’t work out of the program—leading to fewer people on Medicaid overall. Evidence suggests that a work requirement in the 1996 welfare-reform bill, within the Temporary Assistance for Needy Families cash-transfer program, led to a reduction of millions of qualified TANF recipients over time, even as exogenous factors increased employment generally among people in poverty. Indeed, the reform likely pushed those with impediments to work into even deeper rungs of poverty.
If those effects were repeated in Medicaid, it could prove disastrous for the health of the program’s beneficiaries. Especially in states that expanded Medicaid under Obamacare, work requirements could create a new underclass of people ineligible for any health insurance. That includes a large contingent of people with disabilities who don’t qualify for Supplemental Security Income and vulnerable populations like young men with felonies. Caught in a vicious cycle, those people would then be less healthy and less financially secure, and thus less likely to be able to work and make it out of poverty.