Work requirements could punish Medicaid recipients

Opening the door to work requirements for Medicaid recipients is being touted by the Trump administration as "making a positive and lasting difference" in poor Americans' health. 

But a new study about work requirements for Kansas welfare recipients is raising questions about the cost, impact and efficacy of such stipulations. A free-market think tank called the Foundation for Government Accountability has praised Kansas' welfare reform efforts as helping "struggling families get back on their feet," but another recent study from the Center on Budget and Policy Priorities calls those conclusions "fundamentally flawed."

As the debate rages, Governor Sam Brownback has slashed Kansas' spending on cash assistance due to the work requirement. The state's spending dropped to one-third of what it was before the reforms. But whether the work requirements helped families find a steadier financial footing isn't as clear, with CBPP finding the majority who left the program remained far below the federal poverty line. 

Most families receiving welfare payments in Kansas were working both before and after they went on the dole, the study found. That refutes the underlying assumptions of work requirements that welfare recipients aren't employed, said LaDonna Pavetti, vice president for Family Income Support Policy at the Center for Budget & Policy Priorities, a left-leaning think tank. 

"It's important to realize that work requirements aren't going to solve the labor market problems that low-income parents face," Pavetti noted. 

The heart of the problem, the researchers said, is that many of the families who find themselves applying for welfare through the federal Temporary Assistance for Needy Families (TANF) program suffer from underlying issues that a government-mandated work requirement won't solve. Adults who turn to welfare may have a criminal record or lack a high school degree, for instance, which would lessen their chances of finding work. 

Others might work in low-wage industries such as retail and the restaurant industries, where hours can be unreliable. Kansas requires welfare recipients work at least 30 hours a week, but some workers in low-paid industries struggle to get full-time hours from their employers. 

Instead, such workers would benefit from investments such as training programs and improving the quality of jobs available to them, Pavetti said. 

Kansas' welfare experiment might be small compared with a national program like Medicaid, but it has lessons for the broader stage, said Hannah Katch, senior policy analyst at CBPP.

Taking away health care coverage "as punishment for not working, it's very severe," Katch said. "This is why physicians associations have been among the strongest opponents of work requirements."

She added, "Medicaid supports work by giving them the care they need to search for work. They could lose a job because their diabetes or depression worsens, then they lose coverage," which could cause their health issues to deepen, making it more difficult to secure new employment.  

Medicaid serves about 74 million people, with the vast majority already working at wages that put them below or just above the poverty line. About 8 million of those are adults who aren't working or looking for work, but research indicates one-third describe themselves as disabled, even though they don't receive disability benefits. Another third said they are caring for a family member. 

That describes Quenton Radford, a 20-year-old Kentucky resident with multiple sclerosis who is on Medicaid. Kentucky is about to become the first state to impose a work requirement for the health care program, a move the state estimates will save it about $2.4 billion a year by bumping 95,000 residents off the program. Several other states -- including Kansas, Indiana and Arkansas -- have requested federal approval for similar work requirements. 

That could affect Radford, one of the plaintiffs in a lawsuit filed by the National Health Law Program and other organizations in January to block Kentucky from imposing work requirements. He helps care for his grandmother, but hasn't been successful in finding work.

"Having health insurance coverage through Medicaid is fundamental to Mr. Radford going to the doctor for check-ups and when he gets sick," the lawsuit stated. "Even when he is able to find employment, Mr. Radford's working hours and income fluctuate substantially throughout the year [putting him] at risk of losing coverage as his employment status and income ebb and flow."

The additional red-tape of documenting work hours was also cited as a concern for Redford, who expressed concern about getting locked out of the program if he's unable to file a report. Adding layers of bureaucracy is sure to stymie some low-income Americans, such as those dealing with disability, mental illness or unstable home lives. 

Katch noted, "It's extremely burdensome, not only on the state but on the personal level."