Medicaid Work Requirements Would Impact Older Adults

The Commonwealth Fund recently released a report analyzing different proposals by states to impose a work requirement for Medicaid benefits and how those proposals would impact older adults and people with disabilities. To date, 12 states have proposed conducting demonstrations that add work requirements to Medicaid, and the Centers for Medicare & Medicaid Services (CMS) has so far approved proposals from Kentucky, Indiana, and Arkansas. Among other policy changes, these demonstrations would tie Medicaid benefits to a minimum work requirement.

In policy guidance on work requirements released in January, CMS stated that it expects states to exempt people who are “determined by the state to be medically frail” and people with “acute medical conditions validated by a medical professional that would prevent them from complying with the requirements” of a work demonstration. CMS also notes that federal law may require states to modify work requirements to reasonably accommodate qualified individuals with disabilities.

However, the guidance does not include any expectation to exempt older adults from work requirements. The Commonwealth Fund argues that “[a]ge exemption from work requirements should be carefully considered given that low-income working-age adults are significantly more likely than those with higher incomes to report being in fair or poor health or having at least one of five chronic conditions, including hypertension, heart disease, diabetes, asthma, or high cholesterol. And risk increases with age. By age 50, 70 percent of people below 200 percent of the federal poverty level report fair to poor health or having one or more chronic conditions; this percentage climbs to 83 percent by age 55.”

Approaches vary among the proposals submitted so far. Three states have proposed to eliminate the work mandate for people age 50 and older. Other states maintain the requirements to age 65, but point to the “medical frailty” exemption to allow them to make case-by-case determinations. In its guidance, CMS defines the term “medically frail” only in broad terms, and does not distinguish from the existing definition in other federal regulations that identify expansion Medicaid beneficiaries who are entitled to Original Medicaid rather than a more limited package of benefits that a state might offer to the broader expansion population. Under that definition, the overwhelming majority of older poor adults could be designated as medically frail.

To date, four states — Maine, Mississippi, Utah, and Wisconsin — indicate that they intend to use a definition of medically frail that restricts the designation to people who cannot work at all—a standard that mirrors eligibility for Social Security Disability Insurance. Whether CMS will permit such an extreme variation on the current standard, remains to be seen.

The Commonwealth Fund calls upon CMS to more clearly define the acceptable limits of these work requirements, and to reduce the administrative burden on states and beneficiaries, as well as the stress and risk to beneficiary’s health, by requiring that states categorically exempt at least some older adults.

Read the report.