On Friday, Kentucky became the first state with federal approval to implement a so-called work requirement for Medicaid recipients.
"Kentucky is leading the nation in this reform in ways that are now being replicated all over the nation", said Kentucky Governor Matt Bevin, in announcing the plan's approval. As stressed by the administration: "To achieve the objectives of Medicaid, state programs should be created to promote better physical and mental health".
"Medicaid needs to be more flexible so that states can best address the needs of this population", Seema Verma, administrator of the Centers for Medicare & Medicaid Services (CMS), said in a press release. The acronym HEALTH stands for "Helping to Engage and Achieve Long Term Health". Specifically, the ability to impose a work requirement among working-age, non-pregnant Medicaid beneficiaries not eligible for Medicaid on the basis of a disability was sought by 10 states as part of their application for a broader set of Medicaid waivers. It is a "community engagement" requirement that may be satisfied by work, volunteer work, education, career planning, job training, and other activities. In the remaining, only a small number of people will be subject to the requirements. None of the proposals from the states would make real investments in workers' skills; rather, they would force additional paperwork burdens on workforce systems without the capacity to serve everyone who wants training.
The LePage administration is also proposing to charge a group of people earning poverty-level incomes monthly premiums, and to charge them when they use the emergency room for what DHHS determines to be non-emergencies.
"This is creating an impediment to people who might've lost their job and in fact need help getting work, not an extra requirement that keeps them from getting the needed medical care that keeps them healthy", Wagner said.
The announcement came in a 10-page memo with detailed directions about how states can reshape the federal-state health program for low-income people. But they'll only get access to vision and dental coverage if they pay a premium.
Bevin relied on his now-familiar story of growing up poor and having a life of hard work in New Hampshire with no health coverage to explain his desire to give "able-bodied" people on Medicaid the dignity of work. They also must complete a financial or health literacy course. It also states explicitly that states can't get federal Medicaid money for services like childcare and transportation that people might need to get back to work.
The Kentucky Medicaid changes generally mimic those of neighboring IN, which altered its program IN 2015 under then-Gov.
Before Verma joined CMS she was a private consultant and an architect of the Kentucky plan that was approved Friday.
Walthall said she expects CMS to give IN full approval of its application, which would allow HIP to continue for another three years.
Cuello said Medicaid law is designed purely as a health law and efforts by states to add a work requirement, as authorized by federal aid programs such as food stamps, are not allowed.
But Sara Rosenbaum, a law professor at the Milken Institute School of Public Health at George Washington University, said the letter doesn't actually bar states from kicking people with substance abuse problems off their insurance.
Update: This story was updated on January 12 to add information from the governor and more details on the Kentucky waiver once they were released. Authors of the AEI report argue that policies must focus on improving the health of the poor to support employment.