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States across the country are pursuing work requirements in their Medicaid programs. Policymakers in these states have argued that, among other goals, work requirements will generate savings for the state budget. What they don’t say, though, is that these alleged savings would come exclusively from individuals losing their health coverage. Not only that, but states are beginning to realize that after administrative costs and other effects on the state budget are taken into account, Medicaid work requirements won’t even save as much money as initially anticipated. However, the true fiscal costs of work requirements are a blog for another day (keep your eyes out tomorrow!).
Unfortunately, many states are nevertheless pursuing policies that will impose barriers to coverage and care as a way to generate savings. For example, Kentucky recently projected under the new policies of the Kentucky HEALTH Medicaid program, including a work requirement, premiums and copays, and several lockout provisions, almost 20,000 individuals will lose coverage in first year and almost 100,000 individuals are expected to lose coverage in the fifth year. The state touts that the program will save the state $2 billion over five years, though the majority of that is in federal savings with only $330 million in actual state savings.
Nowhere do these states contend that the projected coverage losses are the result of the work requirement working – e.g. that individuals are losing Medicaid eligibility because they found a job with a salary that brings them over their state’s income eligibility limit. Rather, certain states are explicitly admitting that their coverage loss projections are based on individuals failing to meet the work requirement, either by not working or not submitting the right type or amount of paperwork to prove they’re working or potentially eligible for an exemption. For example, in Ohio’s Section 1115 waiver application to impose work requirements on its Medicaid expansion population, the state writes that it expects “50 percent of the 36,036 individuals (or 18,018 individuals) subject to requirement will not comply and will lose their Medicaid eligibility.”
Perhaps these projections should not be surprising because historically work requirements in other public programs, such as Temporary Assistance for Needy Families (TANF), have not been shown to help individuals rise out of poverty. In fact, a five-year study of work requirements in TANF illustrated the percent of individuals employed in 2013 is the same as it had been in 1996 – 63 percent.
These “savings projections” should be called what they really are – harmful cuts that will cause low-income individuals and families to lose access to the critical lifeline of Medicaid. Now more than ever, we need to lift up the voices of those who would be harmed by work requirements to show that any dollar figure of “savings” comes with the real-life consequence of an individual or family losing coverage.