CMS approves Medicaid work requirement waiver for South Carolina

A sign that reads "South Carolina welcomes you"
The Centers for Medicare & Medicaid Services approved a federal waiver for South Carolina to set up a work requirement program for Medicaid. South Carolina is the first state to get such an approval without expanding Medicaid. (Getty/suesmith2)

South Carolina got federal approval to install work requirements for its Medicaid population, becoming the first state that didn’t expand Medicaid to get the nod.

Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma announced the approval during an event Thursday. South Carolina becomes the 10th state to get approval for work requirements, but three have had the programs struck down by courts.

South Carolina differs from the other states, though, in that it did not expand Medicaid under the Affordable Care Act. Other states largely applied the work requirements to the expansion population.

In a spirit of humilityrecognizing that Washington, D.C. does not hold all the answersthe Trump administration has sought at every turn to grant states flexibility in shaping their Medicaid programs,” said Verma in a statement Thursday.

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The new program, set to go online in July 2020, will require able-bodied adults to complete 80 hours of monthly work, training, education or community service to retain their Medicaid benefits.

The state’s health department said that it expects 83,461 individuals will be either required to show evidence that they are exempt from the rules or comply with the requirements. Certain beneficiaries such as children, pregnant women and the disabled are exempt from the program.

But South Carolina doesn’t say how many people will lose coverage due to the requirements.

In Arkansas, the only state to bring work requirements online, 18,000 people lost coverage due in part to requirements that beneficiaries prove their work status online.

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South Carolina will allow beneficiaries to report not just online but also in person or via fax to state offices.  

But the waiver approval received fierce pushback from patient advocacy groups.

“With this approval, South Carolina becomes the first state in the nation to exclusively impose the harmful policy of work requirements on low-income parents with children,” according to a statement from the American Academy of Pediatrics, Children’s Defense Fund, First Focus on Children, Georgetown University Center for Children and Families, March of Dimes and National Association of Pediatric Nurse Practitioners.

The waiver said parents that are the primary caregivers of a child or disabled adult would be exempt but have to provide evidence.

The groups said the waiver program “does nothing to help parents living in or near poverty to overcome the barriers they face in obtaining jobs, such as providing affordable, quality childcare and job training, but instead adds red tape burdens that will fall squarely on parents’ shoulders.”

South Carolina could face similar legal challenges from advocacy groups that have run aground several other states' programs.

A federal judge has struck down work requirement programs in New Hampshire, Arkansas and Kentucky. Judge James Boasberg has ruled that the programs didn't do enough to evaluate how many people will lose coverage and that the programs go against the goal of the Medicaid program of expanding insurance coverage.

RELATED: Study: Adults impacted by Medicaid work requirements struggle to sustain employment

A three-judge appellate panel is considering an appeal to the ruling on Kentucky and Arkansas. Indiana delayed implementation of its work requirement program because of a similar lawsuit, and Michigan's program also faces a lawsuit

Work requirements have also become a political issue in several states.

Kentucky's new Democratic Gov. Andy Beshear has said he plans to get rid of the work requirements. Virginia Gov. Ralph Northam, also a Democrat, has also expressed an interest in halting the requirements after Democrats took control of the state legislature last month.

Virginia expanded Medicaid but only after cutting a deal with Republicans to pursue work requirements, which have yet to be approved by CMS.