A Closer Look at Medicaid Waivers, Part 1: Work Requirements

May 28, 2018

Nearly a year after Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma and then-Health and Human Services Secretary Tom Price sent a letter to states proposing greater flexibility for their Medicaid programs, states have seen varied success in seeking waivers from the federal government to reshape Medicaid.

The area that has received the most attention is CMS’s community engagement initiative, more commonly referred to as work requirements although community engagement could also include educational activities or volunteering. Some states are pursuing such a requirement to apply to the so-called “expansion population,” or individuals who became eligible once the Affordable Care Act (ACA) allowed states to expand their Medicaid programs to include anyone below 138 percent of the federal poverty level. CMS Administrator Verma has stated that including work requirements, particularly on expansion populations, will “help people rise out of poverty” while allowing states to focus on the “most needy.”

These requirements are controversial, leading to legal challenge, and raising many implementation questions. Proponents argue that work itself can improve health; for example, U.S. Surgeon General Jerome Adams pointed to “a large and growing body of literature demonstrating a positive correlation between employment and individual and community health.” States seeking or requiring community engagement have included exceptions, but patient advocates worry that work requirements will cause many, particularly those with complex health conditions that do not rise to the level of a disability, to lose their health benefits. Additionally, advocates are concerned that CMS may not grant all of the exceptions that a state might seek; for example, there has been a debate whether CMS will grant Arizona’s request to exempt Native Americans from a work requirement.

On May 7, New Hampshire became the fourth state— and currently the only state in The Council of State Governments/Eastern Regional Conference— to win approval from CMS to include community engagement as a requirement for those eligible for Medicaid coverage through the state’s Medicaid expansion under the Affordable Care Act. Maine also is seeking a waiver to include work requirements and other policies, and some have speculated that including them might help move the state toward expanding its Medicaid program.

CMS Administrator Verma recently discussed her vision for Medicaid, including work requirements, as part of a Washington Post event on the future of health care. To watch her remarks, click here. The Medicaid and CHIP Payment and Access Commission has released this report on work requirements.

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