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Medicaid Work Requirements Struck Down in a 3rd State

The policy failed another court test, this time in New Hampshire. Despite the rulings, other states are moving forward with work requirements.

(AP/Dake Kang)
Last Updated July 30 at 3:08 p.m. ET

A federal judge struck down New Hampshire's Medicaid work requirements on Monday. U.S. District Judge James E. Boasberg -- who also vacated Arkansas and Kentucky's work requirements -- ruled that the policy is "arbitrary and capricious."

"We have all seen this movie before," he wrote in regards to the anticipated health insurance losses.

Before Boasberg's latest decision, New Hampshire officials already put the work requirements on hold after estimating that 17,000 people would have lost their Medicaid coverage in August. It's the third state to halt such requirements, which were not allowed under the Obama administration.

The idea of work requirements for Medicaid arose after the passage of the Affordable Care Act (ACA), President Barack Obama's signature health-care legislation. The law allows and encourages states to expand the number of low-income people eligible for Medicaid. The federal government initially pays 100 percent -- and eventually 90 percent -- of the costs of expanding eligibility to people earning 138 percent of the federal poverty line.

New Hampshire expanded Medicaid in 2014. Starting last month, the state had started to require expansion beneficiaries between the ages of 19 and 64 to work, volunteer, participate in job training or be in school at least 100 hours per month. People who are pregnant or unable to work were exempt.

But, according to New Hampshire Public Radio, some beneficiaries received conflicting notices about whether they were exempt from the work requirements, and the website wasn’t letting people report employment or self-employment. 

Before the ruling, New Hampshire Gov. Chris Sununu, a Republican, gave health officials until the end of September to decide their next move. 

"We knew that the numbers coming back were not good," said Kristine Stoddard, director of public policy at the Bi-State Primary Care Association, which represents community health centers in New Hampshire and Vermont.

Of the 25,000 New Hampshire residents subject to the work rules, only 8,000 had reportedly complied by the end of June.

"Making sure we get this right is absolutely paramount, so the idea of giving ourselves another 120 days to move forward on this and get the implementation where we need it to be, it’s not just fair to the system, but it’s fair to individuals," said Sununu.

After the ruling, Sununu alluded to a possible appeal. He said, in a statement, that Monday's verdict is "only the first step in the process, and we are confident that New Hampshire’s work requirement will ultimately be upheld,” New Hampshire Public Radio reported. 


'A Policy That Can't Be Fixed'?

Some believe that time won't fix the issues with Medicaid work requirements.

"The exact same thing happened in Arkansas," one of the two states -- along with Kentucky, that had their work rules blocked by a judge, said Jessica Schubel, senior policy analyst at the Center on Budget and Policy Priorities (CBPP), a liberal think tank. "Policymakers say that they’re going to be different, but it’s the same challenges. It’s a policy that can’t be fixed." 

If the rules do ultimately prevail in court, New Hampshire's economy may make it a difficult place for people to comply with them. 

"A lot of New Hampshire works in seasonal jobs," said Stoddard, "so it’s really hard to tell someone who does roofing in the summer and snow plowing in the winter that they have to get 100 hours of employment a month in the spring."

Before the ruling, state officials said they were going ramp up outreach, going door-to-door to educate the public about the new requirements.

Schubel, of CBPP, is skeptical that that will be much better than robocalls and letters, which the state had already been doing. “I can’t imagine that they’ll be able to magically inform 20,000 people by September.”  


Slow Implementation

Despite the rulings and administrative snafus, other states are moving forward with work requirements -- at a slower pace.

In Indiana, work rules are already in effect, but the state won’t start enforcing them until January.

"We are using an extended ramp-up period to educate and engage members on how to successfully report work, job training, education or community engagement activities,” Jim Gavin, spokesman for the Indiana Family and Social Services Administration, told the Northwest Indiana Times. 

Four other states -- Arizona, Michigan, Ohio and Wisconsin -- received approval from the Trump administration to implement work requirements. (Seven states have pending waivers.) It’s unclear, however, when any of them will take effect.

Wisconsin’s work rules were set to begin this fall. But in March, the state's Medicaid director, Jim Jones, said at a policy forum that they're "waiting for more guidance from [the Centers for Medicare and Medicaid Services] as it relates to our waiver."

In Arizona, the policy is slated to start "no sooner" than January 2020. Neither the governor’s office nor the legislature has made any movement toward working out the details. 

Michigan Gov. Gretchen Whitmer, a Democrat, says she intends to work with the legislature to tweak the work requirement before implementing it in January. The state Senate passed two bipartisan bills that would ease the reporting rules. They are awaiting a House vote, but Whitmer called them "a huge step in the right direction." 

In Ohio, Medicaid recipients have until 2021 before facing work rules.

*CORRECTION: A previous version of this stated that Indiana would wait until 2021 to kick people off Medicaid for noncompliance with the work rules. In fact, that will start in 2020.

Mattie covers all things health for Governing.

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