State officials look toward some Medicaid work requirements

Jan. 21--With new support from the Trump administration, attempts to impose work requirements on the relatively small number of able-bodied Alabama Medicaid recipients are going ahead.

The efforts focus on the parent and caretaker population, who provide care to children who receive Medicaid. Parents and caretakers must make exceptionally low wages -- 18 percent of the federal poverty line, or $3,740.40 a year for a family of three -- to qualify for benefits. The Centers for Medicare and Medicaid Services (CMS) earlier this month issued guidance for states seeking to impose work requirements.

The Alabama Medicaid Agency is in the early stages of considering a waiver application, and Gov. Kay Ivey gave her support to the moves in a statement on the budgets last week. A Senate committee Wednesday should consider a bill that, among other provisions, would require 20 hours of work per week for most able-bodied adults, albeit with several exemptions.

Supporters of the moves say they will save the state budget money and encourage people to work.

"The principle of requiring work if CMS will allow us to do it is something taxpayers of the state would like to see," said Sen. Arthur Orr, R-Decatur, who is sponsoring the Senate legislation.

Critics say the moves ignore the strict requirements already imposed for Medicaid benefits, and that most states seeking to impose them have expanded Medicaid eligibility to those making 138 percent of the federal poverty line: $16,753 a year for an individual and $28,676 for a household of three.

"Most if not all of the states looking at work requirements are states that have expanded," said Jim Carnes, policy director for Alabama Arise, which works on poverty issues. "They've brought eligibility up to working and low-income adults. It's a much broader population."

Childless, able-bodied adults in Alabama never qualify for Medicaid. The vast majority of the approximately 1 million recipients in the state are children (who make up more than half the program) elderly and the disabled. A population of about 75,000 parents and caretakers can qualify for Medicaid if they provide care to a child 19 years old or younger.

But income limits are strict. In a household of three, income must be $307 a month or less to qualify. By contrast, a person working a 40-hour a week minimum wage job makes $1,160 a month before taxes.

Orr's bill would, among other items, require most able-bodied Medicaid recipients to work at least 20 hours a week, either in a paid job, a voluntary job or a workfare position. The bill exempts children and individuals over the age of 65; pregnant women, parents of children younger than a year old, parents of children with serious medical conditions or disabilities or eligible parents participating in a drug or alcohol recovery program.

A 20-hour paid work week on minimum wage amounts to about $580 a month. Carns said as many as 90 percent of the parent and caretaker population is female, and that a work requirement could force them to address other issues, such as day care and transportation. (Alabama Medicaid said in response to questions Friday that "a very high percentage of this group are female and about three-fourths are women in their child-bearing years.")

"By definition, these are parents of Medicaid children," Carns said. "In many cases, these are moms of young children who are at home."

Carns also said Orr's bill, should it pass, does not provide a period of transition for those who may have to find insurance. Orr said Friday it was "something worth discussing for sure."

The senator said that with unemployment in Alabama around 3.5 percent, able-bodied individuals should be able to find work.

"Ultimately, they'll be able to get employment to go to exchanges and start accessing health care like thousands of Alabamians do in the retail market," he said.

It is not clear how much money the changes could save the state. According to Medicaid statistics, the average annual cost for a parent or caretaker is $5,837, versus about $5,378 generally. That is more than the $2,685 it costs to cover children but less than the $10,012 for pregnant women or $16,625 for the aged, blind or disabled. Rep. John Knight, D-Montgomery -- like Orr, a former General Fund budget chair -- said Alabama's Medicaid program was already one of the most conservative in the country and that the legislation, if it reached the floor, could face "a big filibuster."

"It may be one of those political bills, but the financial impact is very limited at this point," he said.

Any changes to Medicaid would require a federal waiver. Robin Rawls, a spokeswoman for the Alabama Medicaid Agency, said Friday a "concept" was being developed, one that would have public input.

"We've got quite a few steps to go before we're ready to submit anything officially," she said.

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