Medicaid Coverage & Employment

Medicaid has always been a lightning rod for controversy, with 2019 being no different.  There is currently a move towards basing Medicaid coverage on some sort of work requirement; this began in January of 2018 when CMS Administrator Seema Verma introduced announced they would consider demonstration programs to:

 "...to test programs through Medicaid demonstration projects under which work or participation in other community engagement activities – including skills training, education, job search, volunteering or caregiving – would be a condition for Medicaid eligibility for able-bodied, working-age adults."

This announcement was followed by fifteen states proposing demonstration programs with some sort of work or volunteer requirement.  These requirements varied in the qualifying activities, the number of hours worked needed and exempted populations.

Arkansas was the first to implement their program, in Juen 2018.  This program, according to their own reports, resulted in 18,000 losing their Medicaid coverage in 2018 due to the requirement.  This would not be a bad outcome if those who lost Medicaid coverage did so due to gains in employment that offered insurance coverage.  Evidence suggests, however, that fewer than 2,000 of those who lost coverage gained employment, indicating a continued gap in coverage for a vast majority.

Further complicating this issue is the recent court ruling striking down these work requirements in Arkansas and Kentucky.  Despite this, other programs are proceeding while the US DHHS appeals the ruling.  The Kentucky Governor has stated that without the work requirements, they may scale back their Medicaid expansion altogether, endangering coverage for up to 400,000 residents.

These efforts undermine the effects that Medicaid coverage may be able to achieve on employment.  A recent study indicates that single moms had a net gain in employment in states with Medicaid expansion.  The mechanism for this increase?

"Mothers can make more money while still keeping their Medicaid benefits (whereas a lower Medicaid eligibility might discourage them from working in order to maintain coverage) and they can afford to take a job with no or subpar health insurance because Medicaid is covering them."

Time will tell how Medicaid Expansion, work requirements, and various other factors interact to impact coverage and employment among these groups.  Based on what we have seen so far, however, it seems that expansions without caveat may be the most effective overall.