Now that the Center for Medicare and Medicaid Services has approved Kentucky’s Medicaid waiver request, Medicaid recipients in the state will be required to work for their benefits, pay premiums, and perform extensive administrative tasks. This is the first time a state has ever been permitted to impose such requirements.
The change is expected to take place in the summer of 2018, although the measure is currently embroiled in a federal lawsuit questioning its legality.
Related story: “Public health scholars file amicus brief claiming Kentucky’s Medicaid overhaul could drop 300,000 from coverage in year one” (Insider Louisville)
The new Medicaid waiver guidelines
The new work rules will apply to Medicaid enrollees ages 19 to 64 who are not disabled, pregnant, primary caregivers, or students – an estimated 350,000 Kentucky residents. About half of this group already have jobs or are involved in other activities that would satisfy the work requirement. In addition, most Medicaid recipients will still be required to complete administrative tasks and make premium payments under the new guidelines.
This Medicaid waiver is a “Section 1115” waiver. Its requirements include:
- Medicaid recipients will have to be employed, enrolled in job training, in school, or doing community service for at least 80 hours a month to retain their coverage.
- Along with the work requirement, recipients will have to prove they are compliant with the work requirements by providing the state with frequent documentation.
- Monthly premiums will be imposed on Medicaid recipients on a sliding scale depending on their income. Recipients who fall behind in their premium payments will be suspended from the program.
- Medicaid enrollees who do not report changes to income or employment in a timely manner, or make false statements regarding work, or neglect to re-enroll annually, will be disenrolled from the program and locked out from coverage for six months unless they complete a health or financial literacy course.
The state is currently developing a website on which Medicaid recipients can log their work hours or status changes. In addition, the Department for Community-Based Services has an office in every county where recipients can get printed forms that they can mail in.
Real life ramifications
Some Kentucky officials argue that the changes will promote greater personal responsibility and incentivize beneficiaries to work by having “skin in the game.” On the other hand, those who work closely with Medicaid recipients claim the Medicaid waiver supporters lack an understanding of the unnecessary burdens the program changes will impose on those who are already struggling.
As healthcare advocates point out, the Kentucky Medicaid waiver will impose more rules, more paperwork, more costs, and more ways for Medicaid recipients to lose their coverage.
“It is almost like Medicaid recipients are being treated like children in an authoritarian household. … If you mess up even a little bit, we will take away everything you have worked for in an instant,” notes Heather, a Medicaid recipient who asked that her last name not be used. She added, “There is also the punishment of your healthcare being taken away for six months for some infractions; that seems extreme as well.”On the Medicaid waiver: 'It is almost like Medicaid recipients are being treated like children in an authoritarian household. If you mess up even a little bit, we will take away everything you have worked for.”Click To Tweet
As advocates note, the poor tend to have inconsistent work schedules and limited access to resources that can facilitate compliance, such as reliable transportation, a bank account, and internet access – resources most of us take for granted.
Research shows that Medicaid sign-ups fall when states make their programs more complicated. In fact, Kentucky Medicaid rolls are expected to fall by at least 95,000 members as a result of the proposed program changes – and that doesn’t include people who are on and off coverage due to lockouts and suspensions. Without medical coverage many individuals skip routine and even urgent medical care, often turning minor issues into emergencies.
“As an example, without medical treatment a urinary tract infection can spread to the rest of the body; the patient can become septic and die,” notes Ramona Johnson, president and CEO of Bridgehaven. “There is a cascading effect when the individual has to wait for healthcare.”
Interrupting critical mental healthcare and prescription coverage can also have devastating effects, Ms. Johnson says.
The work requirement
Many Medicaid recipients are already working, often for employers who do not offer insurance, Ms. Johnson says.
In addition, many Medicaid recipients are not able to find and keep meaningful employment for various reasons. Limiting access to needed medical care only makes it harder for them to keep working.
Those who are fulfilling the work requirement by volunteering or working in self employment may have a hard time getting the required documentation, according to Emily Beauregard, executive director and CEO for KY Voices for Health.
While Medicaid recipients who are “medically frail” and other specified beneficiary classifications can get an exemption from the work requirement, they will need to go through an “attestation” process that requires them to have a provider complete a lengthy form that could take up to 60 days to be approved. During that time, the individual would still be subject to all new requirements, penalties, and benefit reductions.
Related story: “Have you noticed how poor people are bankrupting the government? Neither have we.” (Washington Post)
The burden of documentation
The reporting requirement can be an onerous task for Medicaid recipients, many of whom do not own cellphones, have limited access to the internet, or limited data capacity on their phones. As Ms. Johnson says, “They can run out of data before the end of the month, which means they can’t make the required updates or changes on line.”
And getting to a county office to obtain required paper forms can also pose a hardship for Medicaid recipients, many of whom do not have access to a car or public transportation.
To make matters worse, county offices are not always open for full business hours and the phone lines are often maxxed out. “You see long lines at the county offices, and peoples’ phone calls are not being answered. People are getting the runaround,” notes Ms. Beauregard.
Even signing up for Medicaid has been a challenge, Heather says. “The website would not work. I would call the number listed, which would then refer me back to the website which was not working for me…I had to reach out for help more than once in navigating the system, and I am fairly computer savvy and competent when it comes to getting a task done. I can imagine how hard it would be for someone who does not use computers on a regular basis, or works a night shift, or has a mental disability to not only manage their Medicaid account and all the requirements and hoops to jump through. I was surprised at how overwhelming it was for me.”
As Ms Beauregard says, “You have people who are doing everything right and they still fall through the cracks because of the complexity of the program.”
While monthly premiums will be assessed on a sliding scale based on the member’s income, even a small premium can cause a person to drop their coverage, notes Ms. Johnson.
Since many Medicaid recipients do not have bank accounts, making even small monthly payments can be a complicated ordeal, often involving money orders, which just adds to the expense.
The bottom line
According to the Courier-Journal, Kentucky plans to spend close to $374 million over the next two years—most of it in federal money—to launch the plan starting July 1.
As a result, it will actually cost the state of Kentucky more to provide health coverage to people affected by the Medicaid changes than if the state did nothing.
Cost savings are projected based on the assumption of a loss of 95,000 Medicaid recipients over five years.
As Ms. Beauregard says, “Tens of thousands of Kentuckians are going to have a harder time accessing healthcare. The changes cost more, but they are providing less care. It makes no sense.”“Tens of thousands of Kentuckians are going to have a harder time accessing healthcare. The changes cost more, but they are providing less care. It makes no sense.”Click To Tweet
“People do not want to be poor and struggling,” Heather observes. “When I was younger I bought into that idea that there were hoards of people living off the government because they were too lazy to get a job and pull themselves up out of poverty. But the reality I have observed as I have grown older is much more complicated. There are lots of low-paying jobs that need to be filled by someone. Those shelves don’t stock themselves and the toilets are not self-scrubbing. Someone has to actually flip that burger.
“Anyone I have met on public assistance has been doing the best they can with the job they have. It would be really great if government officials would stop trying to punish the people who do these jobs by cutting the programs that help them survive.”'It would be really great if government officials would stop trying to punish the people who do these jobs by cutting the programs that help them survive.”Click To Tweet
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