Trump Administration Says States May Impose Work Requirements for Medicaid

WASHINGTON — The Trump administration said Thursday that it would allow states to impose work requirements in Medicaid, a major policy shift in the health program for low-income people.

Federal officials said they would support state efforts to require able-bodied adults to engage in work or other “community engagement activities” as a condition of eligibility for Medicaid.

“Our fundamental goal is to make a positive and lasting difference in the health and wellness of our beneficiaries, and today’s announcement is a step in that direction,” said Seema Verma, the administrator of the federal Centers for Medicare and Medicaid Services.

Verma said the Trump administration was responding to requests from Medicaid officials in 10 states that wanted to run demonstration projects testing requirements for work or other types of community engagement like training, education, job search, volunteer activities and caregiving.

The proposals, she said, came from Arizona, Arkansas, Indiana, Kansas, Kentucky, Maine, New Hampshire, North Carolina, Utah and Wisconsin.

Federal Medicaid officials said that work requirements should be compared to work requirements in other programs like food stamps, now known as the Supplemental Nutrition Assistance Program, and the welfare program known as Temporary Assistance for Needy Families.

In a speech to state Medicaid officials in November, Verma indicated that the Trump administration would be receptive to work requirements and other conservative policy ideas to reshape Medicaid. And she criticized the Obama administration, saying it had focused on increasing Medicaid enrollment rather than helping people move out of poverty and into jobs.

“Believing that community engagement requirements do not support or promote the objectives of Medicaid is a tragic example of the soft bigotry of low expectations consistently espoused by the prior administration,” Verma said. “Those days are over.”

Advocates for Medicaid beneficiaries said the new policy was likely to be challenged in court if people were denied coverage for failure to meet a state’s work requirement.

Federal law gives the secretary of health and human services broad authority to grant waivers for state demonstration projects that promote the goals of the Medicaid program. In the past, federal officials said that work was not one of the purposes of Medicaid.

But Trump administration officials said Thursday that work requirements were consistent with the goals of Medicaid, because work and other community engagement activities could improve the health of Medicaid beneficiaries.

“Productive work and community engagement may improve health outcomes,” Brian Neale, the director of the federal Medicaid office, said Thursday in a letter to state Medicaid directors. “For example, higher earnings are positively correlated with longer life span.”

In addition, Neale said, researchers have found “strong evidence that unemployment is generally harmful to health,” while employment tends to improve “general mental health.”

A 2013 Gallup poll found that unemployed Americans are more than twice as likely as those with full-time jobs to say they have or are being treated for depression, Neale said.

The Trump administration said that states imposing work requirements must have plans to help people meet those requirements and must connect them with job training, but could not use federal Medicaid funds to pay for such “supportive services.”

Medicaid has a major role in combating the opioid epidemic, paying for a wide range of treatment and medications. But people addicted to opioids are often unable to work or to find jobs, and some employers are reluctant to hire people who fail drug tests.

Verma said the Trump administration would require states to make “reasonable modifications” of their work requirements for people who are addicted to opioids or have other substance use disorders.

For example, she said, time spent in medical treatment for opioid addiction might be counted toward compliance with a state’s work requirement. Alternatively, she said, states could exempt people from the work requirement if they were participating in “intensive medical treatment” for addiction.

The Trump administration said that state Medicaid officials could not impose work requirements on pregnant women, elderly beneficiaries, children or people who were unable to work because of a disability.

Rep. Frank Pallone Jr. of New Jersey, the senior Democrat on the House Energy and Commerce Committee, said that “the Trump administration’s action today is cruel and a clear violation of both the Medicaid statute and long-standing congressional intent” for waivers, which he said were meant to “allow states to expand access to Medicaid, not restrict it.” Brad Woodhouse, the campaign director of Protect Our Care, an advocacy group that supports the health care law, said the new policy on work requirements was “the latest salvo of the Trump administration’s war on health care.”

“A majority of adults covered by Medicaid who can work, do work — often two or three jobs in fields like the service industry that are less likely to offer insurance,” Woodhouse said.

Neale, the federal Medicaid official, acknowledged that the support for work requirements was “a shift from prior agency policy,” but he said that such requirements could “promote the objectives of Medicaid.”

People who meet the work requirements of those programs “must automatically be considered to be complying with the Medicaid work requirements,” Neale said. Likewise, he suggested, states should have similar rules for exemptions from work requirements in the various programs.

In devising work requirements, federal officials said, states must comply with federal civil rights laws, including those that protect people with disabilities. For example, they said, states could reduce the number of hours of work required of people with certain kinds of disabilities.

In addition, federal officials said, providing care for young children or elderly family members could sometimes qualify as work.

The federal government and states generally share the cost of Medicaid and could save money if enrollment goes down because of work requirements. White House officials say Medicaid spending is growing at an unsustainable rate, and last year President Trump supported bills that would have cut hundreds of billions of dollars from projected Medicaid spending over 10 years. But the administration said the main purpose of work requirements was to “improve health outcomes” for Medicaid beneficiaries.

More than 70 million Americans are enrolled in Medicaid, and the federal government spent more than $350 billion on the program in the last fiscal year, the Congressional Budget Office says.