Trump-approved Medicaid work rules didn't increase employment, study finds

The country’s first Medicaid work requirement in Arkansas forced thousands of low-income people off health coverage last year but didn't boost employment, according to a new study in the New England Journal of Medicine.

Researchers from the Harvard School of Public Health found the uninsured rate also increased for Arkansans between 30 and 49 years old — the age range of the first Medicaid beneficiaries subject to the new work requirements.

The findings could undercut one of the Trump administration's central arguments for approving the requirements — that mandating work as a condition of Medicaid coverage would spur employment and improve health.

“It should certainly be a warning sign that there’s potential for large coverage losses, potential for significant confusion,” said Benjamin Sommers, a professor at the Harvard School of Public Health and the study’s lead author.

Earlier this year, HHS Secretary Alex Azar suggested without evidence that many of the people who lost Medicaid coverage had left the program voluntarily "because they got a job [in] this booming economy."

An HHS spokesperson Wednesday defended the secretary’s prior remarks, noting that at the hearing "he outlined that there were only 1,452 of 18,000 who reapplied for Medicaid and ‘that seems a fairly strong indication that the individuals who left the program were doing so because they got a job.’ A strong indication is a completely reasonable comment to make when asked about this population seeing that we’ve had such a strong economy under President Trump’s leadership,” spokesperson Caitlin Oakley said in an email.

The Arkansas rules require some Medicaid beneficiaries to report work or a similar activity, such as volunteering or attending school, for at least 80 hours per month to keep their benefits. Work rules in Arkansas, as well as Kentucky, were blocked by a federal judge in March, though other states have been granted the administration'sapproval for similar requirements.

Sommers, the Harvard researcher, said Arkansas' experience wouldn’t necessarily be similar in other states with a work requirement because of differences in how the programs are structured.

Arkansas officials disputed parts of the Harvard study. A spokesperson for the state Department of Human Services said it was not a “meaningful or thorough” evaluation in part because it is based on less than a year’s worth of data. State officials also said it failed to answer a crucial question: Why most individuals who lost coverage did not re-enroll this year when they were again eligible.

“The best way to get answers to everyone’s questions about the impact of work and community engagement requirements would be to let Arkansas continue what was started and conduct a true evaluation that follows people over time,” spokesperson Amy Webb said in a statement.

Under the Arkansas work rules, Medicaid beneficiaries who failed to comply for three months lost coverage for the rest of the year. They are allowed to re-enroll in Medicaid at the start of the following year.

More than 18,000 Arkansans lost Medicaid coverage last year for not complying with the work rules, according to state data. As of mid-May, roughly 4,300 had re-joined the program.

The Arkansas rules took effect last year for Medicaid beneficiaries between 30 and 49 years old. The uninsured rate for Arkansans in that age range rose from 10.5 percent in 2016 to 14.5 percent last year, according to the study. Researchers found the uninsured rate held steady in three other Southern states without active work requirements — Kentucky, Louisiana and Texas.

Further, researchers found the employment rate for low-income Arkansans in this age group declined from 42.4 percent to 38.9 percent. Similar declines in job rates were documented in the three states researchers used as a comparison.

HHS has approved Medicaid work requirements in nine states, contending that the effort would boost job rates and improve health for Medicaid enrollees. Opponents of Medicaid work rules say the requirements are a roundabout way to cull people from the safety net health program.

However, the NEJM study found that 97 percent of low-income people in Arkansas subject to the policy were either already working enough hours or should have been exempt.

“There just isn’t that much room for the policy to boost employment,” Sommers said.

In Arkansas, the state deemed tens of thousands of Medicaid enrollees automatically compliant with the work requirement or extended exemptions to others, including for pregnancy or a disability.

Arkansas beneficiaries subject to the reporting rules often described a confusing and cumbersome process for recording work hours.

The Trump administration has appealed the court rulings against the Arkansas and Kentucky rules. The Kentucky rules had not taken effect before the judge blocked them.