The Center for Budget and Policy Priorities, a progressive-leaning think tank based in Washington, D.C., released an analysis Jan. 10 summing up the many criticisms of Arkansas's experimental work requirement for certain Medicaid beneficiaries.
The report is partly intended to rebut the arguments of those who favor the idea of work requirements in principle but concede Arkansas's implementation of its policy may have been flawed. Seema Verma, the Trump administration's top Medicaid official, seemed to suggest as much in November when she told reporters that observers needed "to separate what’s going on in Arkansas, the policy, from the operations."
In contrast, the CBPP report concludes that Medicaid work requirements are inherently flawed and "can't be fixed." The Arkansas experience suggests all work requirements, no matter how carefully crafted and implemented, will take coverage from some people who are already working or who should be exempt.
"Moreover, Medicaid work requirements will not increase employment or improve health outcomes, contrary to the [Trump] Administration’s claims," the report says. That's in contrast to Governor Hutchinson's previous assertions that thousands of Arkansans have found jobs as a result of the work requirement.
Thus far, Arkansas is the only state to implement such a rule, but several others aim to do so in 2019. New Hampshire plans to roll out its policy on March 1, and Indiana will do so later this year. A work rule in Kentucky was set to go into effect in 2018 but was initially halted by a federal judge who said the Trump administration didn't sufficiently review Kentucky's proposal before approving it; since then, federal Medicaid officials have re-issued approval for the state to proceed. That clears the way for Kentucky's work rule to begin April 1, barring further developments in the lawsuit that previously blocked its implementation. (Arkansas's work requirement faces a similar lawsuit.)
The administration has also approved work rules in Wisconsin, Michigan and Maine, but due to recent political changes in those states, it's not clear when (or if) their policies will get off the ground. Several other states have waiver requests pending.
In a call with reporters on Thursday, CBPP analysts said the results from Arkansas's experiment “validate the most pessimistic projections about such policies." In 2018, Arkansas cut off coverage for about 17,000 beneficiaries, or about 1 in 4 of those to whom the requirement applied. Some of those are people who were indeed working — or who met an exemption under the policy, such as being a family caregiver — but who didn't report their monthly "work activity" hours to the state. The task of reporting hours each month is likely the main driver of coverage losses, the report says.
Judy Solomon, a senior fellow at the CBPP, said experts have long known that increased paperwork and red tape in Medicaid have the effect of driving people off the health insurance program. But, she added, "what we've really learned in Arkansas is that the reporting itself ... is even more of a barrier than we expected."
Coverage losses aside, the policy has failed to meet its own goals, according to Jennifer Wagner, a senior policy analyst. Governor Hutchinson and Trump administration officials have said the work requirement will improve beneficiaries' lives and health by pushing them up to seek employment and move up the economic ladder.
But Wagner said there has been "no meaningful gains in employment from the policy" based on the state's own numbers.
On Dec. 17, when the state Department of Human Services announced the most recent monthly results of the rule, Hutchinson said the work requirement had led to thousands finding new employment. "We’re already seeing significant signs that the program is accomplishing its intent. Since June 1, more than 4,100 Arkansas Works beneficiaries have moved into work, which is the primary goal of this initiative," he said in an emailed statement at the time.
That number comes from a database called the "new hire registry," a spokesman for the state Department of Workforce Services explained to a reporter in November. State and federal laws require employers to report all new hires to the registry, primarily for purposes of child support enforcement and unemployment fraud detection. The 4,100 people referenced by the governor are Medicaid beneficiaries who were subject to the work requirement, did not qualify for an exemption, and found a job after the requirement went into effect.
However, Wagner said, the registry is "not a very reliable source of information" for identifying people who actually found a steady job as a result of the work requirement. The database counts anyone who has been offered employment, regardless of whether they show up for work after their first day (or leave the job within a week). A beneficiary "could have worked for one day," Wagner said, and would still be included in the new hire registry.
More importantly, Wagner said, "there’s no evidence that those new hires are because of this [work requirement] policy." The requirement applies to a population — low-income adults under the age of 50 — who are "constantly moving in and out of the workforce, losing jobs and gaining jobs," she noted. Among workers in the service industry or construction, it's not uncommon to change jobs many times in a single year, sometimes holding a position for many months, sometimes for a few weeks. The new hire registry includes anyone who's been offered a new job, even if they were working a different job before.
Wagner pointed to numbers in the state's November report showing just 371 beneficiaries met the requirement that month specifically by reporting a sufficient number of work hours to the state. There were about 65,000 people subject to the requirement that month, but the overwhelming majority of them were deemed exempt from reporting their hours for various reasons, mostly based on information the state already had on file. Without these automatic exemptions, coverage losses would likely be much higher, the CBPP report notes.
A few hundred others met the requirement by reporting education, job search or volunteer hours. About 900 met a pre-existing work requirement in the food stamp program, or SNAP.
Aviva Aron-Dine, the CBPP's vice president for health policy, said the 371 figure should be considered an "upper bound" on the number of people who could plausibly be considered to have found work specifically because of the requirement. Anyone who changes their behavior and moves into the workforce because they're trying to avoid losing Medicaid coverage, she pointed out, would also be expected to report their new work hours to the state. The low reporting rate suggests that beneficiaries who have found new employment did so because they were already seeking a job, not because Arkansas's work requirement newly motivated them to do so.
If one uses the 371 figure, less than one-half of 1 percent of those subject to the requirement reported new work hours in November, Wagner said.
The work rule applies only to beneficiaries on the Arkansas Works program, the state's name for Medicaid expansion. It began for the first subset of beneficiaries in June and requires able-bodied adults under age 50 to report at least 80 hours of "work activities" each month. In 2018, the requirement applied only to those ages 30-49, but it began including 19- to 29-year-olds in 2019. Those who don't comply for any three months in a calendar year are kicked off Arkansas Works and locked out until the new year begins.
This reporting is made possible in part by a yearlong fellowship sponsored by the Association of Health Care Journalists and supported by The Commonwealth Fund. It is published here courtesy of the Arkansas Nonprofit News Network, an independent, nonpartisan project dedicated to producing journalism that matters to Arkansans. Find out more at arknews.org.