Urban Wire Medicaid Work Requirements Would Do Little or Nothing to Increase Employment, but Would Harm People’s Health
Michael Karpman
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A recent bill passed by the US House of Representatives to raise the debt ceiling would compel states to implement Medicaid work requirements. Courts have repeatedly held (PDF) work requirements to be inconsistent with Medicaid’s purpose, which is to provide medical assistance.

Under these requirements, many adults receiving Medicaid would have to work or perform other community engagement activities for at least 80 hours per month to maintain their coverage. The bill would also expand existing work requirements in the Supplemental Nutrition Assistance Program (SNAP) for so-called able-bodied adults without dependents (ABAWDs) by raising the age of exemption from age 50 to 56. House Speaker Kevin McCarthy has argued that the measure would “help lift millions of Americans out of poverty,” but the available evidence contradicts this statement and demonstrates a range of negative effects.

Work requirements are not an effective tool to increase employment

Work requirements already exist in some safety net programs other than Medicaid, with recipients required to work, actively look for employment, or participate in job training or community engagement activities. These requirements have had limited or no effect on helping people with low incomes secure employment.

A 2021 study on the effects of reinstating SNAP work requirements for ABAWDs found no evidence of increased employment in two states and inconclusive evidence in a third. Other research on the implementation of Medicaid work requirements in Arkansas, which were subsequently halted by federal courts, found that the requirements did not increase employment or community engagement activities.

Most Medicaid and SNAP recipients are already working, could qualify for an exemption, or face barriers to employment

Even if they were more effective, work requirements would not produce significant employment gains because most nondisabled, working-age participants in Medicaid and SNAP are already employed or would likely be exempt. A recent study found that 61 percent of nonelderly adults with Medicaid who did not qualify for that coverage on the basis of disability were working full or part time, and another 30 percent reported caregiving responsibilities, illness, disability, or school attendance as reasons for not working—circumstances that could qualify them for an exemption from work requirements. Most SNAP participants are exempt from the program’s strictest work requirements: only 1 in 6 SNAP participants ages 18–59 were ABAWDs in 2019.

For those who are not exempt from work requirements, the structure of the low-wage job market can make compliance difficult. Urban Institute research finds that many Medicaid enrollees who could be subject to work requirements face barriers to sustained employment, including limited transportation, limited internet access, and residence in high-unemployment neighborhoods. Many recipients are employed but unable to consistently work 80 hours per month all year, primarily because of the labor market or health reasons. Unstable work schedules controlled by employers, for example, increase the likelihood that workers enrolled in safety net programs will fall out compliance with work requirements.

Work requirements would cause many working people and others who could qualify for an exemption to lose benefits

Barriers to documenting compliance or proving an exemption from work requirements put many Medicaid enrollees at risk of losing their benefits. In Arkansas, which had the nation’s third-lowest rate of home internet access, recipients were required to report work activity online every month to avoid being disenrolled from Medicaid. More than 18,000 beneficiaries were disenrolled in just six months after implementation, many because of this reporting requirement or because they were unaware of the requirement and if it applied to them. As one participant shared: “I don’t have [internet access]. I have to go on the bus to get to the library and a lot of times I don’t have a bus pass. The library is pretty far away, not walking distance.”

Similarly, New Hampshire faced the prospect of disenrolling up to 17,000 beneficiaries—two-thirds of those subject to requirements—after implementing Medicaid work requirements in 2019. As a result, state officials halted implementation.

The House bill’s work requirements would affect an even broader and more vulnerable segment of the Medicaid population than these earlier demonstration waivers. Those waivers automatically excluded adults from work requirements who qualified for Medicaid on the basis of disability, but under the House bill, these adults would need a health professional to determine that they are “physically or mentally unfit for employment” to obtain an exemption.

Work requirements are harmful to the health of people who need access to safety net programs

Because of these barriers to complying with and proving exemption from work requirements, people eligible for safety net programs are prevented from obtaining assistance, leaving them without the ability to get health care, food, and other basic needs.

Without health insurance, people could face greater financial hardship, fall into poverty (or deeper into poverty), and be unable to meet health care needs. Many people who look to Medicaid for coverage can’t get insurance elsewhere, given limitations on eligibility for subsidized coverage under the Affordable Care Act. Part-time employees and those working in majority low-wage establishments are also much less likely to be eligible for employer-sponsored insurance.

Some populations are at even greater risk of losing vital supports because of work requirements than others. Black people and other people of color face barriers to employment rooted in systemic racism, and Medicaid work requirements would disproportionately pose risks of coverage losses for people of color, women, and people with chronic conditions or disabilities.

If the goal of work requirements is to increase employment, expanding access to Medicaid itself is likely to be a better way to reach that goal. Adults who gained Medicaid under the Affordable Care Act reported that improved access to health care was critical for their health as well as current and future employment. Ultimately, work requirements in Medicaid would do little or nothing to encourage people to work but can cause significant harm to their health.

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Research Areas Social safety net Disability equity policy
Tags Economic well-being Federal health care reform Health care laws and regulations Health equity Health insurance Job markets and labor force Labor force Public health Racial inequities in health Welfare and safety net programs
Policy Centers Health Policy Center
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