Medicaid’s Still Under Siege—Now in the States

By Suzanne Wikle

Medicaid is under siege again after several failed attempts by Congress last year to drastically restructure it and jeopardize health insurance for up to 70 million Americans. This time, states are on the attack, with the blessing and encouragement of the federal Centers for Medicare and Medicaid Services (CMS). Many states are seeking waivers permitting them to drastically change Medicaid’s eligibility criteria by disenrolling people who don’t work enough hours and, in some cases, prohibiting re-enrollment for six months or more after regaining eligibility. Here’s an update of what’s happening at the federal and state levels on these Medicaid waiver requests:

  • On January 11, CMS issued a letter to state Medicaid directors, indicating its willingness to allow states to disenroll people who don’t meet rigid requirements about working and documenting certain minimum hours of employment. Medicaid has never permitted such waivers.
  • On January 12, CMS approved Kentucky’s waiver request to implement new eligibility rules about work hours. By the state’s own estimate, nearly 100,000 Kentuckians will lose their health insurance because of these rigorous, confusing, and complicated rules. Legal advocates quickly moved to challenge Kentucky’s plans.
  • Arkansas, Indiana, and New Hampshire have also received CMS approval for plans to eliminate health insurance when people don’t meet arbitrary rules about employment hours. 
  • Nine other states have waivers pending before CMS to establish new bureaucratic systems to track work hours and disenroll people when their employers don’t give them enough shifts or their seasonal jobs end. 
  • Several of these requests are from states that haven’t expanded Medicaid, meaning that extremely low-income parents are mostly the only adults who receive Medicaid. While CMS recognizes that connecting Medicaid eligibility to a set number of work hours is especially problematic for very low-income people in these states, the agency has not clearly stated it will reject these waivers. Such requirements would put the states’ very few adults who qualify for Medicaid in a no-win situation: Increasing work hours would cause their income to exceed paltry eligibility limits, but not increasing their hours would cause them to be disenrolled.

In the coming months, we expect more state waiver requests waivers designed to restrict Medicaid eligibility. On June 1, Arkansas will begin implementing its waiver, creating enormous burdens and red tape for people to maintain their health insurance. In mid-June, lawyers challenging Kentucky’s waiver will present their first oral arguments in the case. 

Like last year, 2018 is shaping up to be a tumultuous year for Medicaid. Health insurance for children, adults, seniors and persons with disabilities is under threat because of the waivers’ cumbersome rules and paperwork. Congressional Republicans may release a new ACA “repeal and replace” bill this summer. While it appears unlikely this bill would have much traction in this year’s Congress, it signals Republicans’ continued interest in dismantling health care.

We have some good news, though: Medicaid came out of last year’s attacks more popular than ever. Several states may move forward with increasing access to health insurance by expanding Medicaid. The Virginia legislature just passed expansion, expected to provide health insurance to 400,000 Virginians. And this fall voters will decide for themselves about Medicaid expansion on ballot questions in four states, following Maine’s success in 2017. Even in states without ballot initiatives, health care is likely to be a key issue in this year’s elections. 

While Medicaid may not constantly be in the headlines like last year, this is no time for supporters to relax.