600,000 adults at risk of losing coverage under Republicans' Medicaid work requirement proposal, CBO estimates

Work requirements that have become the political linchpin of House Republicans' legislative proposal to tackle the national debt would likely lead to about 600,000 adults falling off Medicaid coverage and becoming uninsured, according to estimates from the nonpartisan Congressional Budget Office (CBO) published Tuesday.

The contentious Limit, Save, Grow Act of 2023 (H.R. 2811) floated by Republicans last week and passed in the House Wednesday night would ultimately trim the national deficit by a projected $4.8 trillion between 2023 and 2033, CBO wrote to House Budget Committee Chairman Jodey Arrington, R-Texas.

About $120 billion of that total would come as the result of work requirements added or expanded to the Medicaid ($109 billion), Supplemental Nutrition Assistance Program ($11 billion) and Temporary Assistance for Needy Families ($6 million) programs, CBO wrote.

The Medicaid requirement—which would require able-bodied adult enrollees without dependents and up to age 55 to participate in 80 hours of work or work-related activities per month for three months out of the year—would fall on about 15 million people per year, “although many of those people would qualify for an exemption,” CBO wrote.

Once established across all states, about 1.5 million adults would lose federal funding for their Medicaid coverage, according to the report. Of those, an estimated 60% (900,000 people) would remain on their state’s Medicaid program under state-only funding while the remaining 40% (600,000 people) would become uninsured, CBO wrote.

The office’s latest estimates are an update on an analysis of work requirements that were published last summer.

Democratic leaders have said Republicans’ bill would be dead on arrival upon arriving in the Senate, a sentiment shared by President Biden and the rest of the administration.

Another analysis of the proposed work requirements released Tuesday by the Department of Health and Human Services pinned the number of U.S. adults “potentially subject to work reporting requirements” and “at risk of coverage loss” at 21.2 million—more than 6 million above CBO’s estimate.

Democrats were also eager to discuss the proposed work requirements during the House Energy and Commerce Committee’s Subcommittee on Health hearing Wednesday.Amid questions to Centers for Medicare and Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure on the agency’s price transparency, cost negotiation and drug coverage, liberal lawmakers pushed the official to share her agency’s findings on how introducing “bureaucratic red tape” to Medicaid enrollment could keep qualifying adults from signing up for coverage.

“For example, in Arkansas, what we found is that there was an individual who had health insurance who was working, didn’t realize that he needed to fill out the paperwork, lost his job, lost his insurance, had a health condition that made him unable to work,” Brooks-LaSure told lawmakers. “Those stories replicate across barriers so often.”

Cathy McMorris Rodgers (R-Wash.) came to the bill’s defense, highlighting the discrepancy between the CBO and HHS’ numbers and underscoring that “the bill text is very clear” that adults who are pregnant or mentally or physically unfit would not be subject to the requirements.

“I just want to get that on the record because I don’t want people to be concerned,” she said during the hearing after Democrats’ critiques. “We all believe that Medicaid is a very important safety net. What we’re trying to do is protect that safety net and encourage the able-bodied adults without children to work, volunteer or get some training.”

Still, Brooks-LaSure painted the proposed requirement as a negative for maternal health outcomes, saying that women who may initially be unhealthy due to no coverage more often face worse outcomes during pregnancy.

She also stressed that “there has been no link, when we’ve seen work requirements in states, to an increase in employment.”

Another potential complication of the work requirements could be the timing, as millions of Americans are slated to be disenrolled from government programs with the end of the COVID-19 Public Health Emergency.

Lawmakers on both sides of the aisle told Brooks-LaSure that they were concerned about the disenrollments and pushed the administrator and her agency to be proactive in minimizing any potential turmoil among individuals and the industry.

“When we think about the unwinding,” she told the federal lawmakers “what we are doing here at CMS is working very closely with states, both on the Medicaid side as well as the marketplace side, … to make sure that people are aware of the need to update their contact information and update their information if they get unwinding letters from states, and we’re encouraging states to automatically enroll as much as they can.

“We’re also wanting to work with partners, community organizations, health plans, providers, everyone who touches Medicaid beneficiary, and I’ve been thrilled with some of the work that the private sector has been interested in doing and already beginning to make sure that people are aware,” she said.