New Medicaid guidelines unveiled: Trump administration takes a major step in allowing states to require some Medicaid recipients to work

WASHINGTON — The Trump administration will allow states for the first time to impose work requirements on Medicaid recipients.

The Centers for Medicare & Medicaid Services released a guidance Thursday outlining what states need to do to mandate that certain Medicaid enrollees work to qualify for benefits. The agency is expected to start approving state waivers promoting “community engagement activities” in coming weeks.

The historic move would be a significant change in how the government health insurance program operates. States, for instance, could require non-disabled, working age recipients to work, volunteer, go to school or enter a job training program. The guidance also includes caregiving as one of the activities.

“Medicaid needs to be more flexible so that states can best address the needs of this population. Our fundamental goal is to make a positive and lasting difference in the health and wellness of our beneficiaries, and today’s announcement is a step in that direction,” said Seema Verma, the agency’s administrator.

The guidance notes that some Medicaid recipients may have trouble meeting these requirements because of frail health, substance abuse or high unemployment in their areas. States should take these issues — as well as recipients’ employability — into consideration, the agency said.

States will be required to describe strategies to assist recipients in meeting the requirements and to link them to job training resources. However, they will not be allowed to use federal Medicaid funding to finance these services.

Republicans have long wanted to add work requirements to the Medicaid program, which covers nearly 75 million low-income children, adults, elderly and disabled Americans. The broadening of Medicaid to low-income adults under Obamacare — roughly 11 million have gained coverage under the health reform law’s Medicaid expansion provision — further spurred GOP efforts.

However, the Obama administration did not approve any state waivers that would impose work mandates, saying it was not in keeping with the program’s mission to provide access to medical services. Consumer advocates and health policy experts fear that such a requirement could prove a big hurdle for many recipients, leaving them without the care they need.

The Trump administration swiftly signaled that it held a different view. Verma, sent a letter to governors soon after she was confirmed in March urging them to apply for such waivers.

“One of the things that states have told us time and time again is that they want more flexibility to engage their working-age, able-bodied citizens on Medicaid,” Verma told a conference of state Medicaid directors in November. “They want to develop programs that will help them break the chains of poverty and live up to their fullest potential. We support this.”

The guidance release Thursday pointed to several studies that said unemployment is harmful to one’s health and can prompt higher rates of hospital admission and death, as well as poorer general and mental health.

Ten states — Arizona, Arkansas, Indiana, Kansas, Kentucky, Maine, New Hampshire, North Carolina, Utah and Wisconsin — have submitted waivers that include work or community engagement requirements, according to the agency. South Dakota’s governor said in his State of the State address Tuesday that he would also look to require certain recipients to work.

Verma, who served as a Medicaid consultant for Indiana and Kentucky before joining the Trump administration, has long advocated for work requirements. Now, she is in a position to approve them.

“For the future of our country, we need all Americans to be active participants in their communities,” she said in November. “Believing that community engagement requirements do not support or promote the objectives of Medicaid is a tragic example of the soft bigotry of low expectations consistently espoused by the prior administration. Those days are over.”

Many Medicaid recipients are already employed. Some 60% of non-disabled, working-age adults have jobs, while nearly 80% live in families with at least one member in the labor force, according to a Kaiser Family Foundation analysis. Most of those who don’t work cite illness, disability or family obligations as the reason.

Many Medicaid enrollees may have physical or mental health problems — such as arthritis or asthma — that don’t meet the criteria for federal disability programs, but still interfere with their ability to work, Kaiser said. Also, some could find it difficult to meet their state’s work verification requirements.

“Eligible people could end up losing coverage because the right documentation does not get sent to the right place,” said MaryBeth Musumeci, associate director of Kaiser’s Program on Medicaid and the Uninsured.