How Many Will Be Impacted By Work Requirements: Indiana Gives Us The First Clue

As has been widely reported, there are a number of states seeking Section 1115 waivers to establish work requirements for their Medicaid expansion populations – and the Trump Administration has indicated that they are likely to say yes. In just the last week Arkansas and Indiana opened public comment periods at the state level for proposals which included a work requirement. Arizona and Kentucky have pending requests before the federal government.

Work requirements have been a hot topic in the media, and there is certainly good reason for that. But it is worth noting that other pending policies that some states are requesting like lifetime limits (Arizona, Wisconsin), lockout periods (Arizona, Indiana, Kentucky), increased premiums (Wisconsin), and drug testing among other things (Wisconsin) are just as problematic. For more on Wisconsin see a recent blog by Jon Peacock.

As I have repeatedly said, the work requirement is a punitive approach that is bad policy for multiple reasons – most notably because it will precipitate exactly the opposite result that its proponents claim to intend. By that I mean that health coverage is a work support that allows folks to get treatment for chronic and acute conditions that will allow them to be able to work rather than the other way around.

In any event, one of the concerns about the current wave of waiver proposals is that there is a serious lack of data about their impacts and costs. I blogged about this in the case of Arizona a while back.

So we were interested to note that Indiana’s proposal includes some data from the state’s official evaluator – Milliman – which estimates how many people might be affected by the work requirement. It is an important question for a few reasons – the potential loss of coverage being the most obvious – but also the administrative challenges and costs for implementing such a requirement are likely to be considerable.

Here’s what they say – if applied to current beneficiaries just under 133,000 would be subject to the requirements after the exemptions for students, pregnant women, the medically frail and others are applied. Overall the state says more than 438,000 people are enrolled in Healthy Indiana 2.0.[1] Then Milliman estimates that about three quarters of those would be on the program long enough to be eligible to be sanctioned after being referred to the state’s “Gateway to Work” program. Finally Milliman predicts that about 25% of that group – or just under 25,000 people according to our back of the envelope math – would lose coverage because they don’t comply with the work requirement.[2]

A big thank you to Alexandra Corcoran for her help with this blog!

[1]See the state’s waiver amendment

[2] See Table 2 in Milliman Appendix to the state’s amendment.