A nonprofit publication of the Kentucky Center for Public Service Journalism

Kentuckians dropping off medicaid could double if work, ‘community engagement’ rules approved


By Melissa Patrick
Kentucky Health News

The federal-state Medicaid program provides health coverage to about 1.4 million Kentuckians, or about one in three. The exact number fluctuates, because Medicaid and other social programs have a substantial “churn,” people coming onto the program as others come off.

If work requirements are approved for Kentucky Medicaid, the number of people “churning off” of the program in the state would double over a two-year period, going from an estimated 108,000 adults to 216,000, estimates The Commonwealth Fund, a New York-based foundation that supports independent research on health policy reform.

The report says it “should be of concern to policymakers” because research shows that people with gaps in health insurance coverage “report problems getting health care or paying medical bills at rates nearly as high” as those who go without insurance at all.

To predict how work requirements would affect the insurance coverage of Medicaid enrollees, the researchers first analyzed data from federal polling to determine coverage patterns among non-disabled — or “able-bodied”– adults on Medicaid, and then applied those findings to a similar group of Kentucky adults.

In Kentucky, most people in this category are those who gained health insurance under the expansion of Medicaid to those who earn up to 138 percent of the federal poverty level (about $16,000 for a single person). The expansion, under the Patient Protection and Affordable Care Act, added about 500,000 Kentuckians to the Medicaid rolls, most of whom work.

To determine the potential “churn,” the study looked at national Medicaid enrollment in 2014 and 2015, when 9 million Americans were on the program and 3 million people churned off it. The researchers found that 37 percent of them remained uninsured, 28 percent regained Medicaid coverage and 35 percent got another source of coverage.

What about Kentucky?

The researchers then applied those findings to Kentucky, where Gov. Matt Bevin wants to require 80 hours a month of “community engagement” — work, schooling or drug treatment — for people on Medicaid who are not disabled, medically frail or primary caregivers. A federal judge in Washington, D.C., vacated the plan and the Centers for Medicare and Medicaid Services is still reviewing the issue.

District Judge James Boasberg said federal officials had not sufficiently considered public comments about the state’s new plan, which were overwhelmingly against it, nor had they adequately considered the state’s estimate that in five years its Medicaid rolls would have 95,000 fewer people with the plan than without it — largely for non-compliance with its engagement or reporting requirements.

Based on federal Medicaid data for Kentucky, which showed about 325,000 non-disabled adults under 65 in the program in 2016-17, the researchers estimated that over two years, about 108,000 Kentucky enrollees would churn off of Medicaid if the program remained unchanged.

With the work requirements, the number leaving the program over two years would double, to 216,000, the researchers estimated.

“Depending on people’s ability to regain Medicaid or gain private coverage with work requirements in place, the number of adults who would remain uninsured at the end of the two-year period ranges from 77,500 to 117,400,” the report says.

The researchers add that they probably underestimated the number of people who will become uninsured as a result of work requirements, because the study only examined adults who had coverage at the beginning of the study period and didn’t consider those who might have become eligible for Medicaid during those two years — those who might not enroll under the proposed plan because of the administrative barrier created by the work requirement.

Over 8,000 kicked off Medicaid in Arkansas; advisory panel seeks a pause

Arkansas introduced its work and community-engagement requirements in June and has already kicked more than 8,000 people off of its Medicaid program for noncompliance — with another 4,841 set to be kicked off in November if they don’t comply with the new rules before then, according to a state report. Beneficiaries in Arkansas are kicked off if they fail to report sufficient work hours for three months in a given calendar year. They will be allowed to reapply in January.

A pending lawsuit seeks to invalidate the Arkansas program, and because of its similarities to Kentucky’s case, Boasberg is handling the case.

Members of the Medicaid and CHIP Payment and Access Commission plan to ask the Trump administration to hold off on approving Medicaid work requirements, Victoria Pelham reports for Health Care on Bloomberg Law, a subscription-only newsletter.

Fourteen states have either gained approval for or have submitted applications to require able-bodied adults to have to work or participate in approved activities, like looking for a job or job training, in exchange for their Medicaid coverage, says the report, concluding: “Adding new enrollment barriers such as work requirements will accelerate churn in the states that pursue them and leave hundreds of thousands without access to health care.”

What do other studies say?

Other studies indicate work requirements undermine Medicaid enrollment.

A Center on Budget and Policy Priorities analysis estimates that between 45,000 and 103,000 Kentucky Medicaid enrollees could lose coverage because they won’t meet new eligibility or paperwork requirements if the state is allowed to implement its new work requirements. This report adds that there is no evidence that beneficiaries who have lost their coverage will move to jobs with affordable private coverage and they will likely become uninsured.

The Bevin administration says a major goal of its plan, called Kentucky HEALTH for “Helping to Engage and Achieve Long Term Health.” is to move Medicaid beneficiaries to private insurance. An Urban Institute analysis found that Medicaid beneficiaries tend to work in part-time, low-paying jobs and are unlikely to gain employer-sponsored insurance, since only 13.3 percent of part-time private-sector employees in Kentucky were eligible for such insurance.

Speaking only to these two analyses, Cabinet for Health and Family Services spokesman Doug Hogan said in an e-mail:

“Gaining access to employer-sponsored insurance (ESI) is just one potential path. It was never expected that a large percentage of the Kentucky HEALTH population would immediately see access to ESI. Some would see eligibility for subsidies on the ACA exchanges after graduating Medicaid eligibility. Some would have to upskill or increase educational attainment before finding employment that could move them up the income scale. . . . There are numerous studies that show that engagement and employment are linked to health, and that community engagement requirements are effective in driving participation.”


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