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Gabrielle M. Etzel


NextImg:What to know about Medicaid work requirements - Washington Examiner

Congressional Republicans may make work requirements for Medicaid part of President Donald Trump’s major overhaul of taxes and spending, a controversial policy that in practice may lead to reductions in enrollment in the program.

The House budget resolution that passed this week calls for $880 billion in deficit reduction from the part of the budget overseen by the Energy and Commerce Committee, the majority of which is taken up with Medicaid spending.

Medicaid, a federal-state joint program that provides health insurance coverage for low-income adults, pregnant women, and children, is one of the largest federal programs, costing $584 billion in federal dollars alone in 2024. 

Here’s what to know about work requirements for the program.

The basics of Medicaid

As of October, there were more than 72 million adults enrolled in the Medicaid program and nearly 7.3 million minors covered by the Children’s Health Insurance Program, or CHIP, according to the Centers for Medicare and Medicaid Services. 

The program is funded jointly by states and the federal government, with states receiving at least a 50% match rate from the federal budget. In FY 2023, 69% of the total $880 billion in Medicaid spending was federally funded.

The work requirements would apply to only a small number

Republican proposals for incorporating work requirements in order to receive Medicaid benefits only apply to a fraction of recipients. The majority of adult Medicaid recipients have young children, live with a disability, or are seniors. Republicans have indicated that the work requirements would only apply to able-bodied adults without dependents.

Many in that category already work. Only 8% of Medicaid adults between 18 and 64 who are not receiving Social Security disability benefits and who are not also covered by Medicare do not work, according to the left-leaning health policy think tank KFF.

Nearly two-thirds, 64%, of Medicaid adults are employed full-time or part-time. That’s 16.6 million people nationwide. Another 12% are not working due to caring for dependents, 10% due to illness or disability, and 7% due to school attendance.

Michael Cannon, director of health policy at the libertarian Cato Institute, told the Washington Examiner that work requirements for Medicaid are a “perfectly sound idea” but that ultimately, work requirements would only make changes on the margins of the program because they apply to so few people.

“A lot of Medicaid enrollees are elderly people, children, and pregnant women, and they’re not imposing work requirements on those folks,” said Cannon. “It’s the able-bodied adults, and they account for a very small share of Medicaid.”

Work requirements are popular

Work requirements for federal aid, including Medicaid and food stamps, receive high levels of bipartisan support in polling. 

A 2023 Axios-Ipsos poll found that nearly two in three voters, 63%, supported requiring able-bodied adults to work, be in job training, or attend school in order to receive federal subsidies. 

That included nearly half of Democrats, 49%, and 66% of independents, along with 80% of Republicans.

But Medicaid as a program is also relatively popular without work requirements.

KFF polling data also indicates that about two thirds of the American people have some sort of connection to the Medicaid program.

Nearly six in ten Americans say they themselves, a family member, or a close friend has received health insurance from Medicaid at some point. Nearly a third of American adults report having at one point had a child covered by Medicaid.

In total 37% of Americans have a “very favorable” view of Medicaid, while 40% have a “somewhat favorable” view. Nearly seven in ten people think that the Medicaid program “is working well for most low-income people covered by the program.”

Arkansas’s experience with work requirements

During Trump’s first term, several states were approved for Section 115 waivers, allowing them to experiment with requiring a certain number of work hours for able-bodied individuals without dependents in order to receive Medicaid benefits.

The waivers were ultimately eventually blocked by the courts, which ruled that the Medicaid statute is a specifically health-oriented law that does not allow for work requirements.

But before that, Arkansas was approved to implement Medicaid work requirement in 2018, providing an example of how the policy played out. Approximately 18,000 people in Arkansas were disenrolled from Medicaid benefits following the implementation of work requirements before the courts intervened to revoke the policy.

Work requirement proponents see the experience as a success in reducing program costs.

Critics, though, say that it resulted in beneficiaries being removed from the program because they were discouraged by paperwork and bureaucratic obstacles to enrollment.

The Arkansas policy required that beneficiaries who did not meet exemption requirements, such as pregnancy or disability, each month had to inform the state of whether they engaged in the monthly 80 hours of qualifying activities to remain enrolled. If they did not report for three months, they would automatically be disenrolled.

Dr. Ben Sommers, a physician and professor of health economics at Harvard, told the Washington Examiner that Arkansas, in many cases, had enough information on beneficiaries to know whether or not they met the requirements to stay in the program due to employment, job training program enrollment, education, or community service. 

But, of those on whom the state had no verification data, Sommers said about 75% did not upload their information into the online portal to inform the state that they had completed their work requirements or were exempt. 

Sommers says most recipients just “got caught up in the red tape.”

“Many of the people who are not reporting anything to the state, it’s not that they weren’t doing the right things. It wasn’t that they weren’t working or didn’t have a disability. It was that they didn’t understand what they were supposed to be doing,” said Sommers.

Sommers’s research on Arkansas also indicated that the work requirements program did not result in an increase in employment or volunteering. But because the policy was only implemented for about a year, there was not enough time for long-term effects to be recognized.

Still, advocates of work requirements say that the policy will incentivize those who are able to seek employment, where the vast majority of Americans get their health insurance. This, in theory, will ultimately decrease Medicaid enrollment in the long term. 

Many conservatives hope to change the Medicaid statute to explicitly allow for states to implement work or job training criteria to receive benefits. 

Implementing federal Medicaid work requirements

Sommers said that Arkansas “did a pretty good job” matching data from other government systems to beneficiaries to confirm eligibility, but other states likely would not do as well if the GOP institutes a federal work requirements standard.

A similar scenario occurred in 2023, when states resumed re-evaluation of Medicaid eligibility following the temporary pause during the COVID-19 pandemic. About 25 million beneficiaries were terminated from the program. More than half the decline in enrollment was attributable to procedural terminations rather than not actually being eligible for benefits.

“We have first-hand knowledge from the past two years. Some states are really good and some states are really bad at doing data matching and in processing eligibility in a way that reduces red tape,” said Sommers. “So if we have a federal work requirement, we’re going to see some states that are going to lose a lot of people, and we’re going to see some states that can do a better job.”

Sommers said that other states, including Georgia and New Hampshire, also experimented with work requirements but tried to design them in such a way that would minimize the regulatory hoops that beneficiaries had to jump through to prove their eligibility. 

He said that the able-bodied non-working adult population is so low, however, that it ultimately does more harm than good.

“Even if you make the red tape less cumbersome, there’s just not a lot of room for the policy to work,” said Sommers. “You can make it less harmful, but that doesn’t make it beneficial.”

An increasingly likely option for Republicans

House Speaker Mike Johnson on Wednesday said that Republicans will not make major cuts to Medicaid, Medicare, or Social Security as part of Trump’s legislative agenda, but that work requirements could be an acceptable alternative to broad-based cuts.

According to the Committee for a Responsible Federal Budget, imposing federal work requirements for Medicaid would save the government approximately $140 billion over 10 years.

Cannon said that adding restrictions to any social assistance program will naturally reduce subsidy spending, which critics of work requirements identify as the main reason for implementing them in the first place.

“That feels like a less punitive approach, but you’re still cutting people out of the program,” says Sommers. “You’re doing it indirectly, through red tape, and you’re still leaving people without insurance. But it’s getting some of those budget savings in a way that maybe is a little less politically obvious.”

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Cannon said that work requirements for Medicaid are comparatively “small potatoes,” since healthy adults are the least expensive beneficiaries for the program.

“It’s a way to reduce Medicaid spending that is very popular with people,” said Cannon. “It’s not going to reduce Medicaid spending by very much, but it’s something.”