Photographer: Jay Mallin/Bloomberg via Getty Images
Photographer: Jay Mallin/Bloomberg via Getty Images

HHS Allowing Medicaid Work Requirements Will Help Many State Budgets

Elections have consequences.  The old adage is normally invoked by the losing party when the winning party begins to implement policies with which they are unhappy. But it’s a good idea to remind ourselves that consequences can be good and though they may seem small, they can have a huge impact.  In this case, the Trump administration’s efforts to give power back to the states may make a big difference to a lot of state budgets.  On Thursday, the Department of Health and Human Services issued a guidance letter on Medicaid work requirements.  The department has ten waiver requests under review and many more states that are interested in implementing them.  This guidance letter is an effort to provide states with common sense parameters while giving them wide latitude to innovate.

While the media obsesses over every little presidential tweet, the real news is the many good reforms and this is just one example. The administration has a refreshing approach — that states should be laboratories of democracy.  In the case of Medicaid work requirements, there are a few limitations.  States must still ensure individuals have access to substance abuse treatment, and there is a list of exempted individuals including those with disabilities, the elderly, pregnant women and children.  But HHS is giving states freedom in determining how to structure their program.

Some states are allowing community engagement in addition to employment to fulfill the work requirement. Community engagement standards may differ, but in general, they allow volunteer work or other activities that are beneficial to the community to count toward the work requirement in determining eligibility.  In terms of sanctions for not meeting the eligibility requirements, they will be state specific and reviewed on a case by case basis.  Because not all experiments work, states will be required to have independent evidence-based reviews of the program on a regular basis.

Some people immediately began screaming about the injustice of requiring able-bodied people to actually work in order to get government benefits.  Reminding them that these benefits are funded by the millions of Americans who have to work in order to live and pay for their own healthcare is a waste of time.  The reality is that evidence shows unemployed individuals have worse health outcomes than individuals who are employed.  So, the best result if we actually care about people is helping people be productive once again. And whether or not states expanded their Medicaid programs, Medicaid is a crippling part of their budgets accounting for a third or more in most states.  Allowing them to encourage people to cycle off the Medicaid program will reduce costs and is a significant reform that will save many states.  It’s just another example of the fact that elections do have consequences.

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