Work requirements a non-starter for Medicaid waiver

As noted below, Gov. McCrory met with President Obama to discuss flexibility in using Medicaid expansion money to implement a North Carolina specific program that will extend health insurance to more low-income residents. As we have also said, the federal government has shown a tremendous willingness to accommodate governors who request authority to design new and innovative programs. This is all encouraging and kudos to the Governor for sticking his toe in the water.

What is not encouraging is McCrory floating the idea of work requirements as a condition to receive health insurance. As McCrory notes in the article, Utah’s Governor has pushed this idea unsuccessfully. Our Governor feels that President Obama may reconsider his opposition to this idea. That will not happen.

As background, an 1115 waiver allows states to waive some traditional protections in Medicaid to experiment with new ideas that can improve this important health insurance program. Specifically, waivers are meant to promote the ultimate objectives of Medicaid. Several states, for example, now have waivers to purchase private insurance plans for low-income people who would be eligible for Medicaid under expansion. This is an interesting and worthwhile experiment and we will collect important information on outcomes and costs from these state innovations.

Some Governors are abusing this process by applying for 1115 waivers that do nothing but erect barriers for people who need health insurance. A prime example is requesting a waiver that requires people to report to work search programs as a condition of receiving health insurance benefits. This is not innovative. It is not new. We know what happens when you include work requirements as a condition for receiving public benefits. It means many people will not be able to access insurance.

The waiver approved in Pennsylvania includes a provision that automatically refers unemployed people to job programs when they enroll in insurance. That’s fine as long as insurance is not contingent on participation in the work program.

We know, for these reasons, that a work requirement will not be approved by the federal government. There is some concern that Gov. McCrory may use this as a poison pill to sink a Medicaid expansion proposal and then blame the Obama Administration for not showing enough flexibility. Let’s hope that’s not the case.

Gov. McCrory has plenty of room to create a North Carolina specific plan to cover low-income people in the state. He should drop this one idea that everyone knows will never get approved and move forward with an evidence-based, innovative policy.

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