Healthcare advocates warned this week that new federal work reporting requirements for Medicaid will create significant administrative burdens for states. The warnings came during a press call organized by the advocacy group Families USA, which provided an update on the impact of H.R. 1, the budget bill passed last year by congressional Republicans and signed by the Trump administration.
The law enacted the largest cuts to Medicaid in history, according to the group’s executive director, Anthony Wright. “While many of these cuts were timed for after this year’s election, Americans are already starting to see the impacts,” Wright said.
The budget bill cut $900 billion from Medicaid. Wright argued that Republican members of Congress tried to obscure the impact. Many of the cuts targeted states by restricting their ability to finance their share of the program. These unallocated reductions forced states to make difficult choices, he added.
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New rule eliminates state flexibility, advocates say
Mary-Beth Malcarney, a senior Medicaid policy advisor at Families USA, said that over the past 12 months, states have been grappling with the passage of H.R. 1 and the implementation of new eligibility systems while managing funding cuts. She described the approach from the Centers for Medicare & Medicaid Services (CMS) as one that further limits states’ choices to run their programs.
“The first and the biggest one is work reporting requirements,” Malcarney said. For months, states believed they would have some flexibility in implementing the requirements, using electronic databases to streamline the process and allowing eligible individuals to self-report their status. However, she said the new ruling eliminates much of that flexibility and adds complex processes.
The rule effectively bans people from self-reporting their medical circumstances after 2027, Malcarney explained. This makes it much harder for states to determine who is eligible, especially for the most vulnerable citizens. “There are no systems in place that can verify work ability, and so states will have to make individual determinations — that’s applicant by applicant, enrollee by enrollee — to determine health status and working ability,” she said.
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She called the task “enormous.” It will be felt first by Medicaid-eligible individuals who will lose coverage or lose access to gaining coverage not because they don’t meet the requirements, but because they cannot complete state enrollment systems “thrown together in this incredibly compressed timeline.”
Montana moves ahead early, expects coverage losses
State health departments are having to funnel resources into hiring staff, paying overtime, and upgrading aging technology systems just to determine which low-income residents are working, volunteering, caregiving, or studying enough hours to keep their Medicaid coverage. Malcarney said states also need to build new systems to determine who is sick enough to qualify for an exemption and to track all of that on an individual basis.
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Medicaid covers one in five Montanans, said Heather O’Loughlin, executive director of the Montana Budget and Policy Center. She noted that Montana decided to move forward with implementing the community engagement requirements six months earlier than required under H.R. 1.
“I think that the reality is that we anticipate a lot of folks will ultimately lose coverage again, not because they are not working or not in compliance, but because they simply can’t get through the systems the state has,” O’Loughlin said. The state has said it anticipates a loss of coverage of roughly 15,000 individuals by 2027. However, O’Loughlin added, “We anticipate that loss of co
