New CMS guidance paves way for states to test Medicaid work requirements

Medicaid
The Centers for Medicare & Medicaid Services on Thursday both calcified its support for work-requirement waivers and offered guidance to states that might be drawing up such proposals. (Image: Getty/juststock)

The Trump administration has issued new guidelines that pave the way for states to issue policies that require Medicaid beneficiaries to work in order to receive benefits.

Currently, states can’t require Medicaid beneficiaries to work as a condition of eligibility, but they can apply for a waiver that allows them to test programs that would do so. The Obama administration denied such waivers, but the Trump administration has signaled from the beginning that it’s open to approving them.

To that end, the Centers for Medicare & Medicaid Services on Thursday both calcified its support for work-requirement waivers and offered guidance to states that might be drawing up such proposals.

RELATED: Seema Verma unveils her plan to 'turn the page' on the Medicaid program

“This policy is about helping people achieve the American dream,” CMS Administrator Seema Verma said on a call with reporters Thursday. The goal of such waivers, she said, is to let states test innovative ways to help lift people out of poverty.

“Medicaid recipients want to get off public assistance; they want to have a better life,” Verma said. “We see people moving off of Medicaid as a good outcome.”

Guidelines at a glance

The newly released guidelines, Verma said, are meant to balance the goal of providing broad flexibility for states while also “ensuring appropriate protections for individuals.”

For example, the guidelines note that:

  • States should consider allowing a “range of activities” to satisfy Medicaid eligibility requirements—not just work. Those could include skills training, education, job search, volunteering or caregiving.
  • State demonstration projects must exclude elderly beneficiaries, children, pregnant women and people who are eligible for Medicaid due to a disability.
  • States would also have to exempt people who are determined to be medically frail or who have an “acute condition that a medical professional has determined will prevent them from complying with the requirements.” 
  • States must describe how they’d help individuals meet the new Medicaid eligibility requirements and how they’d link them to additional job training resources. However, they cannot use federal Medicaid funding to pay for those services.

For states that have their waivers approved, they will then be required to track and evaluate the outcomes related to their demonstration programs, said Brian Neale, deputy administrator and director for the Center for Medicaid and CHIP Services. The results of those evaluations, he added, will be publicly available.

So far, 10 states—Arizona, Arkansas, Indiana, Kansas, Kentucky, Maine, New Hampshire, North Carolina, Utah and Wisconsin—have submitted waiver proposals that include “employment and community engagement initiatives,” according to CMS. And another state may soon be added to that list, as South Dakota Gov. Dennis Daugaard said Tuesday that he’s asked the state’s Department of Social Services to pursue a Medicaid work-requirement waiver.

Critics unconvinced 

Neale said the design of the programs that states are proposing “look a lot like” already existing work requirements in the Temporary Assistance for Needy Families (TANF) program and the Supplemental Nutrition Assistance Program (SNAP). CMS also said it will help states align Medicaid work and community engagement requirements with SNAP or TANF requirements.

But a recent blog post from the Center on Budget and Policy Priorities pointed out that a review it previously conducted of work requirements in the TANF program shows they actually aren’t that effective. 

In addition, research from the Kaiser Family Foundation has also indicated that the majority of Medicaid enrollees who can work already do so.

And Jeff Myers, president and CEO of Medicaid Health Plans of America, previously told FierceHealthcare that he's highly skeptical of Medicaid work requirements.

For one, he’s concerned about interruptions in care for beneficiaries in managed care plans who might cycle in and out of coverage. And, he said, private insurers don’t have the capacity to check whether Medicaid enrollees are doing what’s necessary to remain eligible under the new regulations.

As for the latter concern, Verma said Thursday that states will continue to be responsible for determining Medicaid eligibility. However, she noted that it will largely be up to individual states how they involve managed care plans in their demonstration projects.