The move allows states to apply for waivers from the Centers for Medicare & Medicaid Services (CMS) that will give them the go-ahead to require Medicaid enrollees to work in order to receive health care coverage.
The administration outlined the work-requirement plan in a letter to state Medicaid officials that indicates the administration's willingness to grant state requests to impose requirements on working-age, nondisabled Medicaid beneficiaries.
Most Medicaid beneficiaries who can work, do work.
The guidance to state Medicaid directors said CMS is committed to supporting state experiments requiring adult beneficiaries to "engage in work or community engagement activities", such as skills training, education, searching for a job, caregiving or volunteer service.
The announcement came in a 10-page memo with detailed directions about how states can reshape the federal-state health program for low-income people. "We see people moving off of Medicaid as a good outcome", she said.
Ten states - Arizona, Arkansas, Indiana, Kansas, Kentucky, Maine, New Hampshire, North Carolina, Utah and Wisconsin - have submitted waivers that include work or community engagement requirements, according to the agency. Many of these sectors often don't offer employees health insurance. Beyond the work requirement, Kentucky wants to have Medicaid recipients pay between $1 and $15 a month, disenroll people above the poverty line who fail to pay their premiums, and require people on the program to report job changes within 10 days.
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"For those who can not find work, requiring unpaid volunteer work in exchange for health coverage is unconscionable legally and morally, recalling the days of workhouses for the poor", Eliot Fishman, senior director of health policy of Families USA, a consumer advocacy group, said in a statement.
A letter sent to state Medicaid directors Thursday by the Centers for Medicare and Medicaid Services says work requirements are created to improve recipient health by "incentivizing work and community engagement".
House Republicans in Harrisburg are still seeking a work requirement for Medicaid, and included the concept in a package of welfare reform proposals announced last week.
A study from the non-partisan Kaiser Family Foundation found that nearly 60% of working-age adults on Medicaid are already employed. That leaves plenty of chances to fall through the cracks of a work requirement. And it includes a definition of "medically frail" and says that states must exempt any individual with an acute medical condition - as validated by a physician - from complying with the requirement, he added.
"They're basically saying the very things the state would have to do [to receive a waiver] do not further Medicaid's objectives and thus won't be allowed federal funding", Rosenbaum said.
Medicaid covers about half of the babies born in this country, she said.
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CMS said it would support state efforts to align Medicaid work and community engagement requirements with Supplemental Nutrition Assistance Program and Temporary Assistance for Needy Families (SNAP and TANF).
This would be the first time in the 52-year history of the Medicaid program that there is any sort of work requirement. Its justification: cutting insurance for low-income Americans who don't work will improve their health.
"This action by the Trump administration goes after people who are just trying to get by", said Democratic U.S. Senator Ron Wyden of Oregon.
People are not legally required to hold a job to be on Medicaid, but states traditionally can seek federal waivers to test new ideas for the program. The guidance cites research that it says demonstrates people who work tend to have higher incomes associated with longer life spans, while those who are unemployed are more prone to depression, "poorer general health", and even death.
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