BACKGROUND
On February 16th, the Ohio Department of Medicaid, pursuant to Ohio Revised Code section 5166.37 established in the biennial budget of 2017, posted its proposal to implement work requirements for the Medicaid expansion population. The Department is seeking the change in policy through the vehicle of an 1115 demonstration waiver. It will serve as an additional eligibility requirement for the 700 hundred thousand people enrolled in the Medicaid expansion. Currently, eligibility is based primarily on income. The proposal establishes a series of categorical exemptions, qualifications and administrative actions that individuals, providers, insurers and government must adhere to before eligibility is granted.
The proposed #Medicaid work requirement creates a new, complex eligibility system and does not outline costs associated with implementation for state or local governments Click To TweetKEY POINTS
- The current work requirement proposal creates a new, complex eligibility system as mandated by the General Assembly
- The proposal does not outline the costs associated with implementation for the state or local governments
- Given the complexity, experience in similar projects indicates the estimates will fall short of reality
- The average member costs of the Medicaid expansion will increase, conflicting with state law
- This waiver does not promote healthier populations
REQUIREMENT REVIEW
In its proposal, the state highlighted the desire to implement work requirements in ways that align with Temporary Assistance for Needy Families (TANF) and the Supplemental Nutrition Assistance Program (SNAP). This alignment is encouraged by the Centers for Medicare and Medicaid Services (CMS) for work requirement waivers. Below is a list of the state’s efforts to align the policy with that of the Ohio statute and CMS guidance through exemptions.
| EXEMPTION | POLICY CONSIDERATION |
|---|---|
| 50 years of age or older | This does not conform to the statute, but it does match the standards for the SNAP program. |
| Physically or mentally unfit for employment | The determination of “unfitness” will need to be determined by a licensed professional. The state would have to develop a form , and the patient would have to work with a provider , to meet this requirement. This would mean that the providers would have to understand the requirement, health systems and others would need to fully understand the liability considerations associated with completion and county/state workers and systems would have to process the information in a way that ensures eligibility in a timely fashion. |
| Participant in the Specialized Recovery Services (SRS) Program | This information should be within the Ohio Integrated Eligibility System. Many individuals who became eligible in expansion were transitioned to other eligibility types over time. This may mean that many who would be eligible for SRS could end up not accessing coverage as easily. |
| Caring for a disabled/incapacitated household member | This requirement will depend on an administrative action not yet outlined in the proposal. |
| Pregnant women | A key strategy in combatting infant mortality and improving birth outcomes is providing coverage to women who have not yet become pregnant and to those who have already delivered. Currently, there is no stated coverage for post-partum services. |
| Parent/caretaker/residing in same house with minor child | This requirement will depend on an administrative action not yet outlined in the proposal. |
| Applied for, or receiving, Unemployment Compensation | This requires adequate information technology in place to communicate between the state’s employment support system and Medicaid. |
| In school at least half-time | This requirement will also depend on an administrative action not yet outlined in the proposal. Education providers will need to provide documentation to students in a manner that explains their enrollment. What’s more, it incents part-time students to increase hours, which adds complexity to individual education financing decisions. It also remains unclear as to what counts as “education” (e.g. GED vs. traditional college). |
| Participating in drug or alcohol treatment | While this exemption will be important, attaining coverage before treatment is a preventative action the state is foregoing. |
| An assistance group member subject to, and complying with, any work requirement under the Ohio Works First (OWF) program | This requires adequate information technology in place to communicate between TANF and Medicaid. |
| Applicant for or recipient of Supplemental Security Income (SSI) | This requirement will depend on an administrative action not yet outlined in the proposal. |
Importantly, the proposal states counties with high-levels of unemployment will be exempt. Since this accommodation is county-based, it may disproportionately hurt smaller units of local government like cities with high unemployment in concentrated urban areas. Given the demographics of large cities, there are civil rights considerations that the state has not addressed in terms of the equal application of the exemption. Beyond the exemptions, the state is also aligning the work requirement itself with the able-bodied adults with dependents standards for SNAP. As we have written about previously, this requirement seems to have a primarily depressive effect on enrollment as opposed to sustained employment.
The process of eligibility includes attestation and “appraisal,” which will be administered mainly through the County Departments of Job and Family Services. It remains to be seen how the state will translate what is required and expected from the county-level caseworkers or, as described in the proposal, how the state plans to ensure that appraisals are not face-to-face. County Departments are also subject to audits to ensure that they are not administering benefits inappropriately, meaning that this increases the financial liability of Departments in meeting this expectation.
ENROLLMENT AND EXPENDITURE CONSIDERATIONS
The state claims the waiver will affect one in 20 Medicaid expansion consumers, leading to the disenrollment of about 18 thousand individuals. This number is achieved through the state’s calculation that about 36 thousand enrollees will be affected, with about half not able to maintain eligibility. That calculation has no stated formulaic reasoning in the proposal. What’s more, over the course of the 5-year waiver, the state will save roughly $571M, which is about .4% of the entire Medicaid budget during that time frame, without factoring in inflation.
These calculations do not take into consideration the cost for state or local governments in administering the waiver, which, according to the experiences of other states with similar projects, is considerable. Interestingly, the average per member cost of implementation actually increases over time. This suggests the disenrollment of healthy people who choose to forego coverage, meaning average costs will grow. As the Joint Medicaid Oversight Committee’s (JMOC) actuary noted when the Committee established growth targets, expansion deflated Ohio’s average per member costs, indicating that work requirements will increase Medicaid’s average per member spending. With this in mind, the work requirement waiver may be in conflict with Ohio Revised Code section 5162.70(B)(1) which mandates the Director implement reforms to “limit the growth in the per recipient per month costs of the Medicaid program.”
Beyond issues of budget neutrality, the state’s application indicates a desire to claim federal match dollars for transportation and “supports to meet the Work and Community Engagement Requirement.” While CMS highlighted that states are required to describe the ways in which they will support these efforts, it specifically outlines that CMS “will not provide states with the authority to use Medicaid funding to finance these services for individuals.” If the state is not able to attain matching funds, there will be “reasonable modifications” to the requirement. Not only is the standard associated not immediately outlined, but, as it will be administered by county Departments of Job and Family Services, caseloads will likely increase as a result.
PROCESS
Given the stated policy position of CMS to implement these waivers, the public comment period will be key in defining the outcome of the application. First, the comment period allows for input on the design elements of the waiver, which the state and federal government must consider. What’s more, it is likely that the state will face a legal challenge to its application, with questions around if the law complies with the Social Security Act and the Administrative Procedures Act.
The Center for Community Solutions will continue to analyze the waiver and provide comments to the state and federal government. As written, the proposal does not seem to accurately capture the costs of implementation, or the likely enrollment outcomes. In fact, looking at SNAP work requirements, the state initially estimated only 134 thousand recipients would be affected. Since implementation, nearly 400 thousand Ohioans no longer receive SNAP benefits. The state is doing more to integrate and automate the eligibility systems in TANF, SNAP and Medicaid. Yet, the implementation date of July 1 requires an efficient education process for the 700 thousand expansion enrollees, 88 county governments,dozens of insurance companies and hundreds of providers who will be affected by these changes without a fully effectuated integration. With this increased complexity, and the potential of disenrollment, the overall successes of the expansion in terms of health outcomes are in question.
Here are the times and locations of the two public hearings required by federal law:
- February 21, 2018 at 9:00am
Tangeman University Center,
2766 UC Main Street, Cincinnati, Ohio 45221 - March 1, 2018 at 10:00am
Medical Care Advisory Committee – Ohio Department of Medicaid
50 W. Town Street, Columbus, OH 43215
The Center for Community Solutions is hosting a webinar on this and other waivers cited in a recent paper on February 22nd. Register for the webinar here.