In a major departure from more than 50 years of US healthcare policy, the Trump administration will let states move towards imposing work requirements on people as a condition for obtaining health insurance under the Medicaid government program for the poor.
The proposed change will allow states to deny access to Medicaid – the largest single health insurance provider in the country – to certain low-income adults, as part of a sweeping welfare reform that many Republicans have demanded for years.
A letter from Centres for Medicare and Medicaid Services (CMS) deputy administrator Brian Neale declared the Trump administration was “incentivising work and community engagement” by allowing states to exempt certain adults from the programme if they were not working or participating in “community engagement”.
“Subject to the full federal review process, CMS will support state efforts to test incentives that make participation in work or other community engagement a requirement for continued Medicaid eligibility or coverage,” said the letter, which was sent to state Medicaid directors on Thursday morning.
More than 70 million Americans depend on Medicaid for health insurance, according to the Kaiser Family Foundation. While other social safety nets – such as welfare and food stamp programmes – have been reformed over the years to include work requirements, healthcare access has been viewed by most policy experts as a right.
Under the new rules, however, states can apply for a waiver to impose work requirements on Medicaid beneficiaries. Ten states have already applied for a waiver and three more are considering doing so, according to the Washington Post. The Trump administration could approve the first waiver as early as Friday.
When applying for a waiver, states must justify how the work requirement would “further the objectives” of Medicaid, according to the letter. They must also allow elderly people, pregnant women, people with disabilities, and those “determined by the state to be medically frail” to be exempted from the requirement. Special consideration must also be given to those struggling with opioid addiction.
Beyond that, states have large flexibility to determine what counts as “employment”. The Department of Health and Human Services suggests, but does not require, that activities such as community service, care giving, education, job training, and substance use disorder treatment count towards the requirement.
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The letter argues that the new rules will encourage people to find employment. It also suggests the change may make people healthier, because employment and community engagement have been linked to increased wellbeing.
Some healthcare experts, however, contested this point.
“It doesn’t incentivise people to work when you take away their care, because the vast majority of people who can work already are working,” Hannah Katch, a senior policy analyst at the Centre on Budget and Policy Priorities, told The Independent.
According to the Kaiser Family Foundation, approximately 60 per cent of the non-elderly, non-disabled adults currently enrolled in Medicaid are already employed. Of the unemployed population, a third said they could not work because they were taking care of their home or family. Another 15 per cent said they were in school, and 6 per cent were looking for work.
Another third of the unemployed enrollees said they could not work because of a disability that had not been verified by the government. According to Ms Katch, work requirements could actually prevent these people from finding employment by denying them the medical treatment they need to thrive.
“We could certainly see people with chronic health conditions get sicker; we could see them not getting access to the primary preventative care that would help them get better,” Ms Katch said. “And it’s certainly not going to help them get a job.”
Ms Katch also pointed to hourly employees, such as waitresses or construction workers, who work variable hours. If they are unable to verify their exact hours to the government each month, they may risk losing eligibility as well.
“This is not going to help anybody get a job, it’s just going to take people off healthcare,” Ms Katch said.
Several critics, including the National Health Law Program, are already considering legal action against the policy. Matt Salo, the executive director of the National Association of State Medicaid Directors, told the Washington Post that the policy would go to court “the minute the first approval comes out”.
The new policy comes as the Trump administration seeks to weaken Obamacare, the 2010 law that aimed to increase the number of people with health insurance – and greatly expanded the number of people eligible for Medicare. More than 10 million people became newly eligible for Medicaid under the expansion, according to the Kaiser Family Foundation.
Clare Pierce-Wrobel, the Director of Payment Reform Models at the Health Care Transformation Task Force, recalled her family’s struggle to find coverage before the Medicaid expansion. Ms Pierce-Wrobel’s aunt, a scientific researcher with a PhD, lost her job after the economic recession of 2008. Unable to find a job, and not eligible for Medicaid, her insurance policy lapsed.
Without a way to pay for preventative care, her aunt waited months to see a doctor when she began feeling ill. When she did, it was too late – she had developed advanced ovarian cancer. She died shortly thereafter.
“There’s kind of this myth that able bodied people who are receiving Medicaid are lazy,” Ms Pierce-Wrobel said, “but most able-bodied people who are receiving Medicaid are working poor”.
She added: “If a family and a person in our position can’t get health coverage in this country, who can?”
The move by the White House follows the recent passage of a major tax overhaul. House Speaker Paul Ryan, who was among Republican leaders who met with Mr Trump to work on priorities for 2018, has long had Medicaid in his sights.
He told a radio show last month: “Frankly, it’s the health care entitlements that are the big drivers of our debt, so we spend more time on the health care entitlements – because that’s really where the problem lies.”