Medicaid and Work: Fact and Fiction in Government Reports

Last week saw the release of two reports on Medicaid and work. One, from the nonpartisan Medicaid and CHIP Payment and Access Commission (MACPAC), an arm of the Congress, is fact. The other, from the White House Council of Economic Advisors (CEA), is fiction. The difference matters, because it goes to the basic identity of the Medicaid program, which pays for health and long-term care services for over 70 million Americans.

The issue brief posted by MACPAC, “The Role of Medicaid in Supporting Employment,” begins with the simple truth that “Medicaid covers a broad range of medical and enabling services to the nation’s most economically disadvantaged populations, including many enrollees with complex health care and social needs.” Put another way, Medicaid is a health insurance program for low-income Americans.

MACPAC then proceeds to summarize the three ways in which Medicaid supports work. First, Medicaid has eligibility categories that make it possible for people with disabilities as well as low-income parents and caretakers to keep their Medicaid coverage even if they get a raise or increase their hours at work. Second, Medicaid gives state agencies the option of offering case management services to connect beneficiaries with job training programs and other employment supports. Finally, Medicaid allows states to provide employment-related services to people with disabilities who are eligible for home and community-based services.

The report posted by CEA, “Expanding Work Requirements in Non-Cash Welfare Programs,” begins with a basic falsehood: “Medicaid is the largest non-cash welfare program.” Medicaid is large, third only to Social Security and Medicare among domestic programs, but as the non-partisan Congressional Budget Office as well as MACPAC recognize, Medicaid is a health insurance program, not a welfare program.

From this falsehood, CEA then proceeds to misrepresent the federal Medicaid statute: “Title XIX of the Social Security Act generally does not impose work requirements as a condition of Medicaid benefit eligibility.” Generally??? Actually, much as the President’s economic advisors and CMS Administrator Seema Verma might wish otherwise. the Medicaid statute does not impose work requirements as a condition of eligibility, and it does not allow states to do so. (The Administration’s effort to allow Kentucky to impose work requirements was recently invalidated by a federal court.)

Let’s be clear as to where the fiction-writers at CEA and the CMS Administrator want to take us: capping federal Medicaid payments to states, either in the form of a block grant or a per capita cap. To get there, they need to persuade the public and the Congress that Medicaid is a welfare program not a health care program. For the sake of the 70 million or so Americans who rely on Medicaid for health insurance coverage, let’s hope they don’t succeed.

Andy Schneider is a Research Professor at the Georgetown University McCourt School of Public Policy.