Louisiana is eyeing an effort that would require able-bodied adults to get a job if they want to receive Medicaid benefits — mimicking efforts in other states that have been bolstered by ballooning Medicaid rolls and encouragement from the Trump administration.
The state Legislature is expected to request that the idea be studied in the coming year to give them more insight and data before deciding to move forward with such a requirement.
“I feel very strongly that as a state this is an issue we are going to have to come to grips with,” said state Sen. Sharon Hewitt, a Slidell Republican who proposed the idea to the state Legislature this session. “The growth is unsustainable.”
Gov. John Bel Edwards, a Democrat, expanded the state’s Medicaid program last year by executive order, taking advantage of one of the key provisions of the federal Affordable Care Act that allowed states to add more people to their Medicaid programs with the federal government picking up a larger portion of the costs.
Medicaid’s free health care coverage is now available to any adult in Louisiana who makes less than 138 percent of the federal poverty level — about $33,500 a year for a family of four or $16,200 for a single adult. There is no requirement that recipients be employed or actively seek employment.
More than 423,000 people in Louisiana have signed up since expansion took effect in July 2016.
Hewitt said she thinks that a work requirement will help drive more people into the workforce, so they can afford better coverage and no longer rely on Medicaid.
“That really is the driver behind all of this. It helps people,” Hewitt said. “Our goal should never be to keep people on Medicaid.”
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Sen. Regina Barrow, D-Baton Rouge, said she would like to see more information about the state’s workforce capacity before requiring employment for health care coverage.
“I believe 99 percent of the people who are unemployed want to work. Most people want to work. There are barriers,” she said.
The state’s unemployment rate has slowly improved over the past year, but March unemployment was 5.7 percent — well above the national 4.5 percent rate.
Barrow said she worried that without employment data, the state could unintentionally punish people for circumstances beyond their control and drive them to more costly health care options like emergency rooms or the state’s already strained safety net hospital system.
“It always appears that we are trying to pick on people because they are poor,” Barrow said. “There are not a lot of job opportunities, sometimes, in our state depending on what your background might be. Some people are forced into certain situations.”
“You have all these different factors that families try to work through that concern me,” she added.
Louisiana already mandates work requirements for able-bodied food stamp recipients, following an executive order from Edwards last year. The Supplemental Nutrition Assistance Program work requirements apply to able-bodied, childless food stamp recipients between the ages of 18 and 49 who are not employed, attending school, enrolled in a job-training program or otherwise exempt from current federal work requirements, and who stay on the SNAP rolls for more than three months.
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Edwards, who has previously mulled similar requirements for Medicaid recipients, and Hewitt have discussed the idea in recent weeks.
“He supports her effort to dig deeper into this issue and will continue to work with her on ways to improve health outcomes in Louisiana so more people have to ability to work and succeed,” Edwards spokesman Richard Carbo said.
By shifting people to the Medicaid expansion population, the state has been able to capitalize on the higher federal match rate for health care costs. Edwards’ administration estimates it will mean a savings of about $300 million for the state next year.
“The governor wants to ensure that we don’t lose those savings as a result of any changes, but this study will help answer those questions,” Carbo said.
Leaders from the Louisiana Department of Health and some senators have expressed concern over the potential cost and resources needed to get a plan in place and seek a federal waiver. LDH currently is under the threat of budget cuts, which leaders cited as a hurdle for taking on a new mandate with no guaranteed outcome.
“It’s unclear at this point whether or not it’s a clear path,” said state Medicaid director Jen Steele.
It’s also unclear how much impact the requirements would have. Steele said nearly 60 percent of the expanded Medicaid population has an earned income on record. That includes the entire expansion population – not just the able-bodied working age population typically included in such requirements – so it doesn’t account for people who are disabled, medically frail or elderly that any new restrictions likely wouldn’t affect.
To date, no state has been able to secure a waiver from the federal government to place work restrictions on Medicaid. Medicaid is administered separately by the states but it is largely paid for by the federal dollars and falls under some federal restrictions.
A U.S. House-backed health care bill meant to replace the federal Affordable Care Act would make the process easier by allowing governors the option of mandating work requirements, rather than the lengthy waiver process. It’s unclear whether such a proposal will get approval in the U.S. Senate, which tepidly received the lower chamber’s health care plan after its House approval Thursday. It’s also unclear what larger implications any health care overhaul could have on Medicaid expansion.
Even if the work requirement process is left to a federal waiver system, the Trump administration has signaled an openness to such requests, which the Obama administration had opposed.
U.S. Health and Human Services Secretary Tom Price and Centers for Medicare and Medicaid Services director Seema Verma wrote in a joint letter to governors in March that the Trump administration backs work requirements.
“The best way to improve the long-term health of low-income Americans is to empower them with skills and employment,” they wrote in the letter.