Medicaid Work Requirements: Trump’s War on the Poor Expands, One State at a Time

Pennsylvania resident Anna Kruk Corbin is a mother of two children with Noonan Syndrome who depend on Medicaid. She is fighting yet another GOP threat to the public health program on which her family relies: The Pennsylvania House of Representatives passed a bill on Friday that would throw thousands of people off Medicaid for failure to meet work requirements.

“Medicaid saved my family,” Corbin said, noting that she previously would have faced financial ruin if it were not for the program. “We had so much medical debt and credit card debt. It wasn’t sustainable.”

Corbin devoted much of her life in 2017 to save Medicaid from several horrific versions of Trumpcare. She attended protests more times than she can recount in Washington, DC and at her state capitol in Harrisburg. The regressive national GOP bill was defeated, of course, but attacks on Medicaid are now accelerating at the state level across the country.

On Friday, as the Pennsylvania House passed its anti-Medicaid bill, the Michigan State Senate also passed a similar bill slapping work requirements on Medicaid.

These actions are the most recent example of a wider attack on Medicaid and beyond. Some approving conservatives are dubbing this approach “welfare reform 2.0” — a callback to President Clinton’s 1996 bill that added similar requirements to food and cash assistance.

Unlike with Trumpcare, however, which sparked national media coverage and widespread resistance, many people in the United States do not know what Republicans are doing to Medicaid at the state level.

“It is a challenge to educate people about this issue. The news media is covering Stormy Daniels, the Russia probe, which they should,” Corbin said. “But Medicaid is being threatened again, and people need to know about it and fight back like we did a year ago.”

Indeed, the current Republican attack on Medicaid is happening one state at a time with minimal scrutiny. Even liberal talk show hosts have largely ignored the subject. On January 11, Trump’s Center for Medicare and Medicaid Services (CMS), run by Seema Verma, sent a letter to state Medicaid directors, saying states could request new eligibility restrictions and cuts with Medicaid 1115 waiver requests (which allow for state-wide experiments using Medicaid funds). At least a dozen states are working on implementing work requirements and a host of other obstacles; Kentucky’s program could be in effect as soon as July.

The term “work requirements” does not fully illustrate what the policy entails. States are making many more regressive changes beyond mandating employment. Some states are also asking for approval for life-time caps, lock-out periods, asset tests, health literacy exams, and drug tests for Medicaid recipients, which may well be approved by Trump’s Department of Health and Human Services. The president has only furthered his embrace of this approach, issuing Executive Order 13828 on April 10, which advocates for “workfare” reforms to be developed across all social programs. The GOP recently proposed stricter work requirements to food assistance, for instance, as part of a farm bill.

Such restrictions are being sold by the administration as part of a strategy for personal empowerment and “incentivizing community engagement.” Health experts, meanwhile, tell Truthout the policy is harmful and rooted in the behaviorist model for social policy, which relies on the false but common notion on the right that poor people are lazy and simply do not want to work.

“People on Medicaid often live very hard lives,” said Sara Rosenbaum, an expert on Medicaid at George Washington University. “Seema Verma wants to make it harder. She doesn’t seem to understand Medicaid as a public health system. Yet, she is breaking with more than 50 years of long-standing policy.”

Welfare Reform and the Clinton Legacy

It is quite telling that conservatives, including members of the Trump White House, are approvingly calling this revival of behaviorism “Welfare Reform 2.0”– referencing the previous push for “welfare reform” that culminated in President Clinton’s 1996 legislation, the Personal Responsibility and Work Opportunity Reconciliation Act.

That legislation was negotiated between Clinton and the 104th Congress, a Republican majority pushing “a Contract with America” that proposed work requirements and other cuts to social programs. President Clinton was at the height of his embrace of “Third Way” politics and advanced a GOP model, saying he would “end welfare as we know it.” He added lifetime caps and work requirements to food and cash benefits, changing food stamps into the harder-to-access Supplemental Nutrition Assistance Program. He also ended the existing cash assistance program, Aid to Families with Dependent Children Act — which guaranteed cash benefits to eligible families with children for 60 years — into the unforgiving Temporary Assistance for Needy Families program.

The bill passed with 25 Democratic votes in the Senate including votes from then-Sen. John Kerry, Sen. Joe Lieberman and Sen. Joseph Biden. In the House, Clinton had to rely on near unanimous support from Republicans with 165 Democrats voting nay, and just 30 supporting the bill. Republicans, by contrast, supported the bill 226-4 in the House.

That the Clinton-era reform so closely mirrors GOP social welfare policy today is a reminder of the Democratic Party’s hostile policies toward the poor and the working class under Clinton. The legacy of this bill, a disaster according to numerous studies, is relevant for its role in normalizing these models and in examining the impact “welfare to work” policies had on food and cash assistance programs.

“Symbolically, [the law was] a radical departure in American social welfare, ending the sixty-year federal entitlement to an income floor for poor families,” wrote Dan Stoesz, who has authored several books on social policy. By advancing these policies, he wrote, Clinton was embracing the GOP view that many welfare recipients are not simply “cash poor,” but also “behaviorally poor.”

The effects of the 1996 law are a warning of what will happen if Medicaid is run the same way today. Bryce Covert described the law’s impact in The Nation in 2016, 20 years after the law was passed:

Since 1996, the share of single mothers with neither income nor cash benefits has risen from 12 to 20 percent. Meanwhile, the number of families in deep poverty has grown from 2.7 million to 3 million. Extreme poverty — defined as families who subsist on $2 or less for each person per day — has seen the most shocking increase: a 159 percent rise since 1996.

Why Work Requirements Don’t Work

Supporters of such programs argue that able-bodied Americans have no excuse not to work. Speaking in support of the Michigan work requirement bill, its sponsor, State Senator Mike Shirkey, asked the following questions of Medicaid patients: “Is having Medicaid an important asset to you and your family? … Why would you allow it to lapse?”

Sen. Shirkey raises relevant questions but does not seem to be genuinely curious about the answers. He asked the question with a false preconception in mind: The poor don’t want to work.

Had Shirkey consulted experts on the subject — some of whom testified in front of the legislature in Michigan — he would’ve gotten some answers. There are, in fact, many valid reasons why people can’t always meet these requirements, including illness, disability, unstable hours or transportation, difficulty finding work and countless other justifiable concerns.

“These [patients] are people who have Medicaid for a variety of reasons, from having had tragic accidents that have left them homebound, to having temporarily low incomes due to unexpected life changes,” said Gilda Z. Jacobs, a former lawmaker and president of the Michigan League for Public Policy. “Yet some lawmakers want to make that struggle even more difficult.”

The Center for Budget and Policy Priorities (CBPP) summarized the harmful effects of the bill in Michigan in an April 19 report and has also done broader studies on work requirements. Still, polling is volatile on the issue and it can be a tough sell, Rosenbaum said.

“This is a difficult subject because when people see something about work [they] think ‘Oh, well everyone needs to work,'” she said. “The problem is many don’t realize that these people are often taking care of a sick family member or child, or any other number of crises.”

In addition, some are sick themselves, some are dealing with a substance abuse disorder, and some have trouble finding work due to a criminal record.

“The CMS guidance fails to recognize the stigma, discrimination and related policy barriers to employment confronting people with criminal records,” the Legal Action Network said. “Medicaid work requirements will only compound the obstacles these individuals already face when trying to secure employment.”

The CBPP has policy briefs explaining how the requirements hurt various stakeholders: low-income families, the homeless, Medicaid recipients who do work, children, those with mental health issues, older Americans, and sick and/or disabled people all suffer under these policies, they argue. The fact that these populations will suffer from a policy initiated within weeks of a massive tax giveaway for the rich did not go unnoticed by many opponents of Trump’s policies.

“I think this is a real learning moment for a lot of people,” said Darrion Smith, an activist and labor organizer in North Carolina, a state that is debating work requirements. “To see him take health care away from the needy just as he gives away billions to the superrich is such a blatant act of classism.”

So outraged was Louisiana Democrat Dustin Miller that he asked a Republican colleague if “somebody who can’t find a job should have to die?” It’s not a hyperbolic question. Lack of health insurance is responsible for tens of thousands of preventable deaths each year.

Moreover, the programs are also not a source of any real savings. Reports show they can be time-consuming administrative burdens that do not save money, relieve poverty or  improve health outcomes.

Abusing a Flawed Waiver System 

Medicaid 1115 waivers are not well understood by the public. The waiver process permits states to use federal Medicaid funds in a new “experimental, pilot or demonstration project” that “is likely to assist in promoting the objectives of the program.” The National Health Law Program has a website monitoring how these requests are being made in their state and across the country. One problem is that the waiver system is being used for reforms far broader than intended.

“These waivers are tools to do small, narrow projects with. They are using it to do everything,” said Leonardo Cuello, health director of the National Health Law Program, in an interview with Truthout.  

Moreover, a report from the Government Accountability Office (GAO) released on January 19 found that the waiver system is deeply flawed and needs major improvements.

About one-third of Medicaid’s spending goes toward [1115] demonstrations, which allow states to test new approaches to delivering Medicaid services. Do they save money? Improve care?

The short answer is that states and the federal government don’t fully know. We found that the federal government did not require complete and timely evaluations from the states, so conclusive results were not available. Moreover, the federal government wasn’t making its evaluation results public — missing opportunities to inform federal and state Medicaid policy discussions.

These are worrying conclusions, given states lawmakers’ increasing use of waivers to make sweeping ideological policies. Ten states are using waiver programs for more than 75 percent of the program, the GAO reports, costing a third of the entire federal Medicaid budget. President Obama pledged to “increase the transparency of the waiver approval process,” according to the Kaiser Family Foundation, though clearly progress was limited.

“The GAO does not [go] as far as to say all 1115 waivers should be suspended, but this is the position that we at the National Health Law Program take,” Cuello said.

It is worth noting that Medicaid 1115 waivers can sometimes be used for good. At least six states used them to expand Medicaid under the Affordable Care Act, for instance. But without accurate, timely data, the efficacy of a project cannot be known.

“Evaluations are essential to determining whether [1115 waivers] are having their intended effects,” the GAO noted. The report also observes that Indiana won’t look at the effect of the state’s provision that locks out enrollees for six months if they fail to pay premiums — a provision that has been proposed along with work requirements in several instances.

Trying to Save Medicaid — Again

Organizers and legal advocates are resisting these changes, in both the court of law and the court of public opinion. At least 160 organizations have written to the Department of Health and Human Services to announce their opposition to work requirements. Opponents include labor groups, children’s rights advocates, tribal leaders and anti-poverty groups, among many others.

A federal class-action lawsuit in Kentucky — the first state to receive a waiver  — against the Trump administration for violating Medicaid law is especially important. The Southern Poverty Law Center, the National Health Law Program and others are strongly supporting it. Should a judge rule against Trump, this shift to Medicaid could be stalled or stopped, according to Cuello.

Litigation is expected to pop up in other states as well. If the judicial system cannot stop “welfare 2.0,” however, the battle will likely come down to whether a movement to stop these policies can counter the GOP and its support from the likes of the Koch Brothers. One advantage that organizers have is their recent experience in fighting GOP health plans — and stopping them.

The coming elections are also crucial, especially at the state level, at which the waiver requests are created. Republicans now control 33 governor’s mansions and two-thirds of state legislative bodies. If Democrats can win back some of these statehouses, however, the odds of work requirements becoming law will be much lower. Further, if the Republicans do not retain the White House in 2020, the next administration would likely rescind CMS Director Verma’s policy.

“We can’t take this program for granted,” mother and activist Corbin said, noting that she will be attending a protest on May 2. “I don’t want my kids to live in a world without Medicaid, or access to care. But this could be the case if we don’t act. We defeated them before and we have to do it again.”