More than 30 states have proposed or are implementing work requirements, in some cases to enable Medicaid expansion. Read an update about state efforts and a recent federal court ruling on Kentucky’s waiver application.

Since January, when the Centers for Medicare & Medicaid Services (CMS) announced it would allow states to require certain enrollees to participate in work or community engagement activities in exchange for Medicaid coverage, four states have secured approval from CMS to impose the requirements.
However, last Friday, Kentucky’s effort to implement work requirements was put on hold after a federal judge blocked the new rules. Eight other states have proposals pending before CMS, numerous others have drafted or are planning proposals, or have introduced bills in state legislatures.

Under the new federal guidelines, states can seek CMS permission to add work requirements for non-elderly, non-pregnant, and non-disabled adults as a condition of Medicaid eligibility. State proposals vary in their scope and political context. In some states that implemented the Affordable Care Act’s (ACA) Medicaid expansion, the work requirement applies only to the expansion population. In other states, it affects a broader group of Medicaid enrollees. Some states are presenting work requirements as a compromise to win political support for or to retain Medicaid expansion, although many non-expansion states are also considering them.

In January, CMS approved Kentucky’s plan to impose Medicaid work requirements, but implementation of the work requirements and other aspects of the waiver – such as imposing higher premiums and coverage lockouts – were blocked by a federal court on June 29, 2018. CMS and Kentucky have 60 days to decide whether to appeal. Earlier, the governor had signed an executive order to end the Medicaid expansion if the courts ultimately invalidate the waiver.

Currently, three other states – Arkansas, Indiana, and New Hampshire – have received federal approval to implement Medicaid work requirements, and Arkansas began implementing them on June 1, 2018. Additional states have proposals before CMS and others plan to submit them in the next few months. In April, Alabama closed its comment period on its draft waiver proposal to add work requirements for parents and caretaker relatives covered by Medicaid, and is expected to submit the proposal to CMS soon. In late April, Ohio submitted its application to implement work requirements specifically for its Medicaid expansion population.

Utah’s governor signed legislation that requires state officials to pursue a waiver to implement Medicaid work requirements in conjunction with its request to expand Medicaid up to only 100 percent of the federal poverty level. South Carolina’s governor directed the state Medicaid agency to develop a work requirements waiver, and the state is in the early stages of doing so. South Dakota’s governor mentioned in his annual address that the state would be seeking a Medicaid work requirement waiver. The state closed the comment period on its draft waiver proposal in mid-June, and will be seeking federal approval to implement Medicaid work requirements beginning with a pilot program in two counties.

In some states, Medicaid work requirement discussions are occurring in state legislatures, and are sometimes tied to proposals to expand Medicaid. During Virginia’s special legislative session this spring, the General Assembly passed a budget bill that included Medicaid expansion with work requirements. The governor signed the bill in early June, and the state will be developing a waiver proposal in the coming months.

A number of other states that have not expanded Medicaid have proposed bills to seek federal waivers to implement work requirements for certain adults in their traditional Medicaid programs. Tennessee’s legislature passed a bill that was signed by the governor in May 2018 that directs the state to seek federal approval to implement Medicaid work requirements for able-bodied, working-age adult enrollees without dependent children under age six. Other non-Medicaid expansion states that have introduced Medicaid work requirement bills during their 2018 state legislative sessions include:

• Florida: While the House passed a bill, it did not progress past a Senate committee prior to the legislative session ending.
• Idaho: State legislators added Medicaid work requirements to a bill that also included the proposed Idaho Health Care Plan, but the legislature adjourned without advancing it.
• Missouri: In January, a bill was introduced in the Senate and remains in committee.
• Oklahoma: In addition to issuing an executive order in March for the state to begin drafting a waiver, in May the governor also signed a bill passed by the legislature to implement Medicaid work requirements.
• Wyoming: Although the legislature has adjourned, legislation did pass the Senate but did not move forward.

In some states that expanded Medicaid, state legislators have introduced bills that include work requirement proposals. Most of them would apply to a broader group than the expansion population and would include all “able-bodied” adults, such as some parents – with varying exceptions:

• Alaska: Bills were introduced in both the House and Senate in February, but they did  not move past the committee level prior to the legislature adjourning.
• Connecticut: In February, a Senate bill was proposed (exempting individuals who are the sole caretaker of a dependent), but the legislation stalled.
• Illinois: A bill was introduced in the Senate (exempting adults with dependent children), but it did not move forward.
• Iowa: Legislators proposed a bill in the House, but it did not advance because it was deemed to need additional revision and would be too costly to implement. A similar bill in the Senate  also did not move forward before the legislative session ended.
• Louisiana: There were bills in both the House and Senate that did not move out of committee prior to the end of the legislative session.
• Michigan: Michigan’s legislature passed a bill that was signed by the governor on June 22, 2018, that directs the state to seek federal approval to implement Medicaid work requirements for most able-bodied adult Medicaid enrollees.
• Minnesota: A bill was introduced in the Senate in mid-March (exempting individuals who are the sole caretaker of a dependent),  but it did not move past the committee level prior to the legislature adjourning.
• Pennsylvania: A bill in the House passed in mid-April and has been referred to the Senate; however last year the governor vetoed a similar bill.

In Colorado, a Medicaid work requirements bill failed to pass a Republican-controlled committee in March – the legislator who voted against it suggested the state should assess the implementation process in other states like Kentucky before moving forward with the program change.

CMS’ guidance left many decisions about the parameters of a Medicaid work requirement to state discretion, such as the number of hours that individuals must complete, penalties for noncompliance, the types of qualifying activities, and how often individuals would need to submit documentation to demonstrate they are meeting the requirements. For states considering adding these types of requirements to their Medicaid programs, there are also many other policy and operational issues to address.

For example, tracking whether enrollees are complying with the work requirements as well as determining which individuals qualify for exemptions is expected to be a complex and costly administrative task – and could result in coverage losses for individuals. An additional factor for states to weigh is that according to an analysis conducted by the Kaiser Family Foundation, most non-elderly adults covered by Medicaid already work – 60 percent are employed either in part-time or full-time jobs. Another 32 percent reported not working due to illnesses or disabilities, enrollment in school, or caregiving responsibilities, and consequently many of these individuals may qualify for work requirements exemptions.

Though most state legislative sessions have concluded their sessions,, this issue is expected to continue to receive active consideration by state policymakers. Also, given the recent court decision on Kentucky’s waiver, some states may postpone pursuing work requirement waivers until that case is resolved. NASHP will continue to monitor states’ work requirement waiver proposals that have been submitted to CMS in this chart.