Five Medicaid Work Requirement Truths
Pending budget legislation instructs the Department of Human Services (DHS) to request a waiver from the federal Centers for Medicare & Medicaid Services (CMS) to create a work requirement for healthy adults on Medicaid.
At least four states are actively seeking permission to enact Medicaid work requirements. There is strong evidence this policy change would help improve the quality of life for enrollees. When Kansas and Maine strengthened work requirements in their Food Stamp program, those leaving the program saw their incomes more than double and enrollment dropped by 75 and 80 percent, respectively.
In Pennsylvania, the reinstatement of work requirements for the Supplemental Nutrition Assistance Program (food stamps) resulted in 30,000 able-bodied adults choosing to leave the program. While the reported data neglects crucial indicators – such as the number of former recipients now employed or earning larger incomes – other states' experiences indicate these individuals have rejoined the workforce.
Work requirements have put thousands of Americans on a pathway to independence. Unfortunately, many organizations benefiting from the current high-cost and substandard Medicaid system claim this fair-minded reform will create barriers to health care services. Yet, the biggest barrier to high-quality health care is the rising cost of private insurance. Prioritizing work will increase incomes, and help people access high-quality services and escape poverty.
1. Work is the pathway to high-quality health care.
Medicaid offers recipients relatively poor access to health care. Studies show Medicaid recipients experience more difficulty finding doctors and longer wait times than those with private insurance. Even when Medicaid patients finally see a doctor, the care they receive is subpar. For instance, one study found women using Medicaid were less likely to receive preventative services.
Medicaid spending is growing by about 7 percent annually, yet state revenue is increasing at a rate of only three percent. Recently Gov. Wolf admitted the state couldn’t afford to pay for the program’s escalating costs if the federal government reduces Pennsylvania’s share of Medicaid funding. The governor noted the federal losses “are unacceptable and insurmountable.” This dependency on the federal government, which is dealing with its own fiscal crisis, is another reason state lawmakers should seek to reduce the costs of Medicaid.
2. Work requirements would apply to a significant number of able-bodied, non-working adults.
DHS claims approximately 20 percent of the Medicaid population is non-working healthy adults. While 20 percent sounds like a small number, it’s significant considering Medicaid is the largest entitlement program in Pennsylvania. DHS estimates a work requirement would impact at least 490,000 healthy adults. That’s the population of Harrisburg, Lancaster, Allentown, Erie, Scranton, and Reading combined. Enabling almost a half a million people to afford private health care would be a huge achievement.
3. Medicaid work requirements have been part of public discussion for a long time.
The work requirement waiver was introduced in May as HB 1407, but this isn’t the first time Pennsylvania has considered work requirements for healthy adults. In 2014, the Corbett administration attempted to enact work requirements as a condition of the Medicaid expansion. Furthermore, the legislation requires DHS to submit a waiver. The waiver process takes months and requires public hearings and public comment periods. Passing HB 59—the legislation authorizing the state to seek a waiver—is only the beginning of the process.
4. Medicaid work requirements are fair and popular
The public believes it is fair to ask the able-bodied to work in return for benefits, including the poor themselves. Overall, 87 percent of the general population and 81 percent of the poor support work requirements.
Work requirements are about refocusing welfare programs on poverty alleviation and transitioning recipients to good-paying jobs. Such requirements also protect scarce resources for Pennsylvania's most vulnerable citizens who are disadvantaged under the poorly-designed Medicaid expansion funding scheme.
5. Any reform must help individuals and families transition from poverty to prosperity.
Reducing Medicaid enrollment is a worthy goal. Why would anyone want to relegate people to a system with a reputation for poor quality care and shaky finances?
When President Bill Clinton established a successful welfare-to-work program during his administration, states experienced significant reductions in their welfare rolls because individuals were earning more and didn’t depend on government to meet their needs. For instance, employment of single mothers without a high-school diploma increased by two-thirds, and employment of single mothers between 18 and 24 approximately doubled.
Work leaves families better off. To ignore this fact and urge people to trust a failing system is nothing short of a moral scandal.