Featured in Health Business Daily, Dec. 5, 2017

In Age of Uncertainty, Some States Seek Medicaid Work Requirements (with table: States With Notable 1115 Demo Waivers Recently Approved or Pending)

Reprinted from MEDICARE ADVANTAGE NEWS, biweekly news and business strategies about Medicare Advantage plans, product design, marketing, enrollment, market expansions, CMS audits, and countless federal initiatives in MA and Medicaid managed care. Subscribe today!

October 19, 2017Volume 23Issue 20

Last year’s election of Donald Trump (R) sent shock waves through much of the country, and for public health stakeholders, one question immediately took the forefront: What does this mean for Medicaid?

Under the Affordable Care Act (ACA), over 14 million people became eligible for and enrolled in Medicaid, many of them nondisabled childless adults, a population that was typically excluded from the program. Republican leaders have long opposed enrolling this population, believing that public funds should be reserved for critical populations, such as the elderly, children and disabled individuals. Now that the ACA appears to be here to stay, however, this population must be managed, and the door is open for change. Bolstered by Trump’s win, several states hope to make their expansion population less costly, and ultimately reduce it, by implementing conservative reforms such as limited eligibility, benefit designs that mirror employer-sponsored coverage and work requirements.

To date, work requirements are not a condition of any state Medicaid program, although they have been implemented in several states for other public assistance programs, such as Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF). Many experts in the field view these reforms as unlikely to hold up against much scrutiny — as many in the Medicaid population are seniors, children, disabled individuals or primary caregivers in the home, and would not be in the workforce regardless. And those who can work already do. Among the nondisabled Medicaid expansion population, only 13% are not working or in school, according to data from the 2015 National Health Interview Survey. But with Republicans at the helm, the environment has become much more favorable to sweeping reforms.

Medicare Advantage News

Former HHS Secretary Tom Price, M.D., and CMS Administrator Seema Verma in March sent a letter to states, affirming their commitment to helping states implement alternative models of Medicaid delivery and encouraging them to seek waiver authority (MAN 3/30/17, p. 1). They cited several areas where states could innovate and request waivers, many of which overlap measures already in place in Indiana’s Medicaid expansion program, which Verma designed. The potential reforms include:

  • Beneficiary contributions, such as small monthly premiums and copayments for some services;

  • Efforts that support employment among Medicaid eligibles;

  • New benefit designs for Medicaid members that include features that mirror private insurance, such as Health Savings Accounts;

  • Discouraging the use of emergency services for non-emergency care;

  • Ways to make it easier for Medicaid eligibles to enroll in employer-sponsored health insurance;

  • Waivers that support families enrolling in the same plan; and

  • New eligibility procedures that do not guarantee continuous coverage.

In response to the letter, several states submitted new or amended Section 1115 Demonstration Waiver requests with these changes in mind (see table, p. 5). Among states that are not requesting work requirement programs or benefit design changes (e.g., Illinois, New Jersey), integration of primary care, behavioral health services and long-term care to improve member outcomes (and therefore cut costs) is the primary focus.

While it’s clear the administration wants to champion these Medicaid overhauls, it’s uncertain when these requests will be approved. With Secretary Price’s exit from HHS in September, the agency’s next steps seem to be up in the air. And at least eight states are awaiting approval of new or modified demonstration waivers.

From the editors of AIS’s Medicare and Medicaid Market Data

States With Notable 1115 Demo Waivers Recently Approved or Pending


Program Name

1115 Waiver Status

Latest Statewide Managed Medicaid Enrollment

Latest Statewide FFS Enrollment


Alabama Medicaid Transformation

Approved Feb. 9, 2016




Arkansas Works

Approved Dec. 8, 2016, amendments pending since June 30, 2017




Illinois Behavioral Health Transformation

Pending since Oct. 20, 2016




Healthy Indiana Plan 2.0 (Amendment)

Pending since July 20, 2017




Kentucky HEALTH

Pending since Sept. 8, 2016, modifications proposed July 3, 2017




MaineCare (Amendment)

Pending since Aug. 2, 2017




MassHealth (Amendment)

Pending since Sept. 8, 2017



New Jersey

New Jersey FamilyCare (Amendment)

Approved July 27, 2017



North Carolina

North Carolina's Medicaid Reform Demonstration

Pending since June 1, 2016




Wisconsin Badger Care Reform

Pending since June 15, 2017



*includes 321,139 enrollees in Illinois Health Connect’s Primary Care Case Management Program.
**includes approximately 1.6 million enrollees in Community Care of North Carolina, a public-private partnership with regional provider and hospital networks

SOURCE: MMM, AIS’s Medicare and Medicaid Market Data. Visit the MarketPlace at www.AISHealth.com for a free interactive demo.

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