Study: Medicaid work rules caused coverage losses, no job gains in Arkansas; argument continues about what would happen in Ky.

By Melissa Patrick
Kentucky Health News

A study led by experts at Harvard University found that work requirements in Medicaid, like those proposed in Kentucky, resulted in thousands of people in Arkansas losing health coverage, with no evidence that they got jobs.

The study, published in the New England Journal of Medicine, brought predictable contrasting reactions from a health policy analyst and a Kentucky health official when asked if Kentucky can expect the the same results if the courts allow the rules.

“I don’t see how Kentucky could expect any different outcome for its Medicaid program if it were allowed to go through,” said Jason Dunn, policy analyst for Kentucky Voices for Health.

Kristi Putnam, deputy secretary of the state Cabinet for Health and Family Services, disagreed. “We do not expect the same results,” she said, adding that the study “does not tell the whole story.”

Putnam manages the state’s new Medicaid program, which wants the federal government to waive traditional Medicaid rules so the state can require, among other things, “community engagement” by most of the “able-bodied” individuals who gained coverage through the expansion of Medicaid to people who earn up to 138 percent of the federal poverty level. That means they would have to work, attend school or take job training 80 hours a month, or participate in drug treatment.

U.S. District Judge James Boasberg of Washington, D.C., has ruled twice against the waiver, as well as a similar one for Arkansas, after concluding that federal officials failed to show how work requirements would serve the objective of the 1965 Medicaid Act, which is to provide people with medical coverage. The administration of President Donald Trump has appealed the ruling.

Putnam said she doesn’t think Kentucky would see the same results found in the Arkansas study,  largely because of the state’s aggressive outreach campaign and its commitment to be flexible and proactive in its effort to improve the health of Kentuckians.

She said Kentucky”s roll-out period has been longer than the one in Arkansas, giving more preparation time; Kentucky is working with strategic partners who are committed to the program’s success, like the Foundation for a Healthy Kentucky, the Kentucky Hospital Association, Kentucky Youth Advocates and all of the state’s federally qualified health centers; employers and regional workforce development boards in the state are “excited and engaged” in the process; and the state continues to hold forums to inform stakeholders about the new requirements.

Communication is key

A big issue found in the Arkansas study was a lack of awareness and confusion about requirements that Medicaid beneficiaries report their work and community engagement activities. It found that one-third of the targeted adults had heard nothing about the policy, and that 44 percent were unsure whether it applied to them. Among those the state had told to report, only 49% were doing so regularly.

Putnam acknowledged that this is a “very legitimate concern,” but said Kentucky is working hard to avoid the problem. She said field interviews with Medicaid beneficiaries in doctor’s offices and health centers “found that a lot were not” aware of the rules. “And that kind of changed our approach in how we were communicating.”

Putnam said the state plans to do more interviews, but has added more text messaging, increased its social-media presence, and is engaging with its strategic partners to get the information out, rather than relying on phone calls and mailed notices that are often not answered or read.

On the other side of the argument, Dunn said he expects the same outcomes as Arkansas because Kentucky has many of the same reporting hurdles, and that is what led to many in Arkansas to lose their coverage.  He noted that the study found that 95% of the people who lost their coverage in Arkansas shouldn’t have because they were already working or would have qualified as exempt.

Putnam said that shouldn’t be a problem here because Kentucky’s technology is different. She said the state has gone to great lengths to assure that all reporting can be done from mobile devices, has worked to make sure the screens are easy to navigate and understand, and has designed the computer program to automatically exempt most people who qualify for an exemption.

Dunn disagreed. He said Kentucky Voices for Health has heard “a lot of complaints about the system” being difficult to sign up on, and difficult to use. The system is the same one people who are on the Supplemental Nutrition Assistance Program (formerly food stamps) use to report their work hours.

Dunn said recent reductions in Kentucky’s SNAP rolls, due to failure to meet similar reporting requirements, indicate there would be similar drops in Medicaid coverage. “We’ve discontinued over 20,000 people through March of 2019, in about a one-year period,” he said.

Putnam argued that the two programs offer different benefits and should not be compared. She said that because American health benefits are typically tied to hours worked, it is important to help Kentuckians learn how to work within that system. “The hope is that we can prepare people for the fact that this is part of our reality,” she said.

Putnam added that Kentucky has the ability to be flexible and to react if it sees people dropping off the Medicaid rolls, which it will monitor “pretty much on a daily basis.”

What’s the objective?

Supporters of work and community engagement requirements have long argued that work requirements will spur employment and improve health.

In Arkansas, that didn’t pan out. The researchers found no significant increase in employment, which fell from 42.4% to 38.9% among the targeted population. It also did not see a significant increase in the number of hours worked, or overall rates of job training or community service.

Putnam pointed to research that shows a connection between a person’s overall economic well-being and their overall health well-being.

“We’re more concerned with seeing improvements in health outcomes and people’s well-being, but we believe that is very correlated to community engagement and improving your circumstances when you are able to,” Putnam said.

Gov. Matt Bevin, a Republican who talked about the waiver in his 2015 campaign and is seeking re-election, has stated broader goals.

Bevin told Judy Woodruff on PBS News Hour last year that he would like to see all of the state’s “able-bodied” people working or in some kind of community engagement, and asked, “Why should somebody have to go to work every day and pay taxes to provide something to someone who could do the same thing, but chooses not to? That’s very un-American.”

Dunn, of Kentucky Voices for Health, agreed that economic well-being is often tied to better health outcomes, but said it shouldn’t be tied to any kind of eligibility.

“We like the idea of a service that provides linkages to educational opportunities and employment opportunities, we think as an overall effort in addressing social determinants of health that that is a good aspect of that – but not tying that kind of activity to eligibility. That is the part that is wrong,” Dunn said. “I think what we’d like to see from this study is a better understanding that these kinds of policies do nothing but to serve to create new barriers to coverage. That they don’t produce the results that people hypothesized and instead they lead to what a lot of researchers said was going to happen, and that is people lose their coverage.”

Questions about the study

Putnam cautioned that the information gathered in the survey was self-reported and did not include any information about Arkansas’ outreach efforts, nor any information from the Bureau of Labor Statistics, a federal agency that tracks employment. She added, “It does not tell the whole story of the individuals who are no longer getting Medicaid services.”

Arkansas officials have said the study is not a “meaningful or thorough” evaluation, partly because it is based on less than a year’s worth of data, Politico reports. They also said it did not address why most individuals who lost coverage did not re-enroll this year when they were again eligible.

Of the 18,000 who lost coverage, as of mid-May, roughly 4,300 had re-joined, Politico reports.

The study was led by the Harvard T.H. Chan School of Public Health. It looked at Arkansas’ Medicaid work and community engagement requirements to see how insurance coverage and employment were affected. Arkansas was the first state to implement such requirements and prior to it being vacated by Judge Boasberg in March, the program resulted in 18,000 people losing coverage.

The study conducted telephone interviews with 30- to 49-year-olds, who were subject to the new requirements, compared with adults who were not subject to them. It also looked at outcomes for adults in three comparison states that have not implemented any work requirements: Kentucky, Louisiana and Texas (which, unlike the other two, has not expanded Medicaid).

In addition to finding a significant drop in insurance coverage among the 30- to 49-year-olds, from 70.5% to 63.7%, the researchers also found that the uninsured rate for this same group increased from 10.5% in 2016 to 14.5% in 2018, with smaller or no changes in the other groups.

The researchers found no significant increase in employment, which fell from 42.4% to 38.9% among the targeted population. It also did not see a significant increase in the number of hours worked, or overall rates of job training or community service.

The researchers concluded that the 18,000 people who fell off the Medicaid rolls in Arkansas after the work requirements were implemented neither secured jobs or other insurance coverage.

The most common reason (40.4%) for not reporting was a belief that they were not meeting the requirement, even though their responses indicated that they were meeting the requirement. Other reasons for not reporting were lack of internet access (32.3%) and confusion about reporting (17.8%).

“Lack of awareness and confusion about the reporting requirements were common, which may explain why thousands of persons lost coverage even though 95% of the target population appeared to meet the requirements or qualify for an exemption,” the study report says.

The Trump administration has approved similar plans in nine states and seven more states have pending applications to add work requirements, according to the Kaiser Family Foundation.

New Hampshire’s work requirements took effect this month. Jason Moon at New Hampshire Public Radio talked with health officials there and reports that “early signs are pointing to a bumpy road ahead.” The issues described seem similar to those in Arkansas: confusion, lack of awareness, and difficulty with reporting requirements. This program is also being challenged in court.

The Commonwealth Fund estimates that if Medicaid work requirements are fully implemented in the nine states that have received federal approval, between 600,000 and 800,000 people could lose their coverage after 12 months. It is estimated that between 86,000 and 136,000 would lose coverage in Kentucky alone.

The state has estimated that after five years, Kentucky’s Medicaid rolls would have 95,000 fewer people under the program than without it, in large measure for failure to meet reporting requirements.