Medicaid Work Rules Met Legal Opposition in Several States

Last modified: January 26, 2021

Americans qualifying for the Medicaid low-income health insurance program steadily increase; yet, some states plan on cutting it down by imposing certain work requirements. Meanwhile, there were also several states that showed resistance against these rules. 

To continuously improve overall healthcare, states were allowed to conduct experiments with these Medicaid plans. To be able to do this, they would need demonstration waivers and pilot programs. In connection to this, the Trump administration announced (in early 2018) that work requirement waivers would be permitted by the federal government. But before granting such waivers, the Department of Health and Human Services has to acknowledge that the pilot programs would benefit the Medicaid system as a whole and promote its objectives. 

Medicaid waivers apply certain work rules. For instance, to retain Medicaid eligibility, adults should work for the required hours per month. If this is not possible, they have the option to engage in equivalent activities such as job searching, caregiving, and skills training among others. 

Advocates of the work rules said that this would help in increasing the employment rate for people with low income. However, critics pointed out that the rules might not be effective. The reason being is that most recipients of Medicaid work (already); the majority of them have full-time jobs but they receive low wages and pay for low-rate employer-based insurance.  

Even though there might be certain inefficiencies with Medicaid work rules, guidelines were already issued regarding waiver proposal designs for the many states. Certain recipients, including the elderly, people with disabilities, pregnant women, and children, should be exempted from following the work requirements.   

Currently, there are nine states that already received approval to implement Medicaid work requirements. However, three out of nine states (New Hampshire, Kentucky, and Arkansas) had their programs halted due to federal court resistance. 

Judge James Boasberg blocked Kentucky’s waiver approval as well as the similar rule implemented in Arkansas which left 18,000 people with no coverage. The court concluded that the work rules of Kentucky and Arkansas were capricious because the negative effects were not considered properly. 

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