What the Data Says about Medicaid, Work and Work Requirements

Medicaid covers one in five Americans, including many with complex and costly needs for care. Historically, non-elderly adults without disabilities accounted for a small share of Medicaid enrollees; however, Medicaid expansion under the Affordable Care Act (ACA) created coverage for nonelderly adults with income up to 138 percent of the Federal Poverty Level, or $16,642 per year for an individual in 2017.

As of December 2017, 32 states (including Iowa) had expanded Medicaid. By design, expansion extended coverage to the working poor (both parents and childless adults), most of whom do not otherwise have access to affordable coverage. While many have gained coverage under expansion, most Medicaid enrollees remain the “traditional” populations of children, people with disabilities and the elderly.

Some states and the Trump administration have stated that expansion targets “able-bodied” adults. In response, they want Medicaid eligibility contingent on work. Under current law, states cannot impose a Medicaid work requirement. However, some states are asking for waivers to this law and the Trump administration has indicated a willingness to approve such waivers.

To understand the potential implications of Medicaid work requirement proposals, the Kaiser Family Foundation has examined data on the work status of the nearly 25 million non-elderly adults without SSI enrolled in Medicaid. Key takeaways include the following:

  • Among Medicaid adults (including parents and childless adults — the group targeted by the Medicaid expansion), nearly eight in 10 live in working families and a majority are working themselves. Nearly half of working Medicaid enrollees are employed by small firms and many work in industries that rarely offer health insurance.
  • Among the adult Medicaid enrollees who were not working, most report major impediments to their ability to work including illness or disability or care-giving responsibilities.
  • While proponents of work requirements say such provisions aim to promote work for those who are not working, these policies could have negative implications on many who are working or exempt from the requirements. For example, coverage for working or exempt enrollees may be at risk if enrollees face administrative obstacles in verifying their work status or documenting an exemption.

The research also shows that Medicaid expansion has not negatively affected labor market participation and some research indicates that Medicaid coverage actually supports work. In addition, focus groups, state studies and anecdotal reports highlight examples of Medicaid coverage supporting work and helping enrollees transition to new careers.

Work requirements can also create administrative complexity and put coverage at risk for eligible enrollees who are working or may be exempt.  States can incur additional costs and demands on staff and some eligible people could lose coverage as they struggle with administrative obstacles in verifying their work status or documenting an exemption.  In addition, some individuals who may be exempt may face challenges in navigating an exemption which could also put coverage at risk.