Four years after agreeing to expand Medicaid to cover more low-income adults, Michigan Republicans want an estimated 350,000 enrollees who are not working to get a job — or, at the very least, to start preparing to enter the labor force.
Their aim is threefold: to rein in a massive, costly government health insurance program they say has grown far beyond its basic mission, to help businesses fill job openings and to reinforce the importance of work for abled-bodied people.
Democrats and other opponents counter that the Senate-passed legislation would inevitably result in people losing vital coverage despite significant gains in lowering the number of uninsured and create a costly bureaucracy of paperwork that is difficult for recipients, employers and physicians to navigate.
Gov. Rick Snyder, a strong Medicaid proponent, will be critical to the fate of the proposed “workforce engagement” requirements now pending in the House.
“He’s not opposed to them if done responsibly,” said spokesman Ari Adler. He said that is why the Republican governor has committed to working with the bill sponsor, Sen. Mike Shirkey, to address the initiative “in a way that he can support” if a measure is sent to his desk.
The joint federal-state Medicaid program covers 2.5 million Michigan residents, a quarter of the population, and costs at least $17 billion a year.
The legislation would require an average of 29 hours a week of qualifying work activities to qualify for taxpayer-funded insurance — employment, education, job training, vocational training, an internship or participation in substance abuse treatment. The 29-hour requirement is certain to be lowered in the House because Snyder worries it is too high.
Roughly 1 million able-bodied, nonelderly adults would be affected, including 700,000 who would be ineligible for exemptions from the requirements. Shirkey said a vast majority of the 700,000 qualified through the Medicaid expansion, and half of them already work.
An estimated 70,000 to 105,000 enrollees, or 3 percent to 4 percent of the entire Medicaid population, could lose their insurance under a 29-hour rule, according to the nonpartisan House Fiscal Agency. The liberal-leaning Center on Budget Policies and Priorities estimates at least 150,000 people could lose coverage under a 20-hour requirement but says the number would be higher if Michigan sticks with a restriction that anyone who fails to meet the requirements could not regain coverage for a full year.
Such estimates are preliminary because the three states whose 20-hour-a-week Medicaid work requirements have been approved by the Trump administration — Kentucky, Indiana and Arkansas — have not implemented them yet. A lawsuit was filed in January to challenge Kentucky’s rules. The federal government is considering work requirements proposed by seven other states.
Shirkey said making abled-bodied Medicaid enrollees work or receive job training is not punitive.
The bill “represents a very reasonable, a very responsible, a very compassionate list of exemptions and encouragement for those who are covered by Medicaid in Michigan to engage in the workforce,” he said. He said one of the best things people can do for their health is to work, and the Medicaid expansion — which he supported — created “unintended disincentives” to stay unemployed.
“Work is good,” said Shirkey, a Clarklake Republican. “The best way to find a better-paying job is to have a job.”
Critics, though, are raising a host of objections to the measure. They say Medicaid at its core is a health care program — not a work program — and despite 15 listed exemptions for caretakers, the disabled and others, people would fall through the cracks and be excluded from insurance due to extra red tape and paperwork.
Opponents say low-income workers in the retail, restaurant, home health and construction industries often have volatile, part-time hours and unstable employment. They add that having insurance means Medicaid recipients with health problems are treated and have an easier time working.
Most enrollees already work, are students or are retired. About 60 percent of Michigan’s nondisabled adult Medicaid enrollees are working, and 75 percent live in a working family, according to the nonpartisan Kaiser Family Foundation.
“Medicaid is an earned benefit system that we take on together, as a state, because Michiganders understand that everyone deserves the opportunity to be healthy,” said Rep. Yousef Rabhi, an Ann Arbor Democrat. “This bill is heartless and misguided, and I hope the people of Michigan watch closely as Republicans rob them of their health care coverage.”
Medicaid recipient Claire Maitre, a 62-year-old from Scio Township near Ann Arbor, babysits her 3-year-old and 7-year-old grandsons when their parents are working. She said she would go without health insurance rather than give up caring for the boys and doing volunteer work. The bill, she said, would hurt uncompensated people within the indispensable but hidden “care economy.”
A House committee took initial testimony on the bill this past week. The average annual per-case cost for an able-bodied adult is $4,300. If the measure were enacted as written, combined federal-state Medicaid spending would decline by $301 million to $452 million a year, according to a House fiscal analysis. Yearly state savings — Michigan spends $3.6 billion in general or equivalent funds on Medicaid — would be $45 million to $68 million after factoring in extra administrative and computer costs to verify hours worked and qualifying exemptions.
The legislation is supported by business and conservative groups and opposed by health advocates and groups representing the poor.
Republican House Speaker Tom Leonard signaled that the chamber will not vote unless Shirkey and the governor’s office can agree to changes to the legislation.
“We want to see it get signed into law,” he said.
Senate Bill 897: http://bit.ly/2IaDEdp