As expected, the House’s rushed attempt to finance the Trump Administration’s immigration and tax agenda by cutting Medicaid includes a “work requirement.” Proponents claim that it is intended to support employment but it does no such thing. In fact, it’s a policy that takes health insurance away from millions of people, including workers. This policy has failed both times it has actually been tried (and even the House seems to know it won’t work—more on that in a moment).
In 2018, Arkansas briefly implemented a work requirement—in just a few months 18,000 people lost their health insurance until a court stepped in to stop the coverage losses. Ignoring the Arkansas lesson, Georgia in 2023 implemented a partial Medicaid expansion with a work requirement. Although hundreds of thousands of Georgians would otherwise be eligible for health insurance in the new expansion, only 7,000 are enrolled because of the work requirement. The state has a roughly 3% success rate and hundreds of thousands of Georgians haven’t been able to get insured. (The only winners under Georgia’s model have been consultants, as my colleague Joan Alker has explained.) The Georgia failure is so abysmal that this year the state conceded the program isn’t working, and has filed a new amendment in a desperate attempt to fix the unfixable.
Enter Congress.
Instead of learning from Georgia, which should have learned from Arkansas, the House is now rushing forward to force the same mistake on all states. No state has ever designed a successful Medicaid work requirement, and yet the House is going to require it in all 50 states and DC. The whole purpose of section 1115 demonstrations – the authority used to try work requirements in Arkansas and Georgia – is to test policy ideas. But the rationale behind section 1115 is, of course, to adopt policies that are shown to be successful. The House is instead loading everyone onto a plane that has never actually been successfully flown. To make matters worse, the House is adding major problems to the design.
In several respects, the new proposal is worse than other proposals Congress considered and never acted upon. The new proposal affects adults up to age 65, whereas under the “Limit, Save, Grow Act of 2023” (LSGA) Congress only considered a work requirement up to age 55. Under LSGA, over 5 million people could have lost coverage. It was estimated an additional one million people would have lost coverage by increasing the LSGA age range to 65. The new proposal also allows states to enforce a “look back” period for compliance. For example, a state could require individuals (at application and renewal, and more frequently if the state chooses) to be in compliance with the work requirement and to have been in continuous compliance for the prior 12 months. This would be a much stricter standard than any state or Congress has ever proposed, and it would be very difficult for individuals to provide documentation that they were compliant many months earlier. Finally, the House bill also has a provision that would effectively block many people from Marketplace coverage (by taking away subsidies) if they are unable to cut through the red tape to comply with the onerous new work reporting requirements.
There is no evidence to suggest this is good policy but there is plenty of evidence showing that work reporting requirements lead to loss of health coverage and ensnare many eligible people in red tape. Congress is trying to compile $880 billion dollars in cuts, and the work requirements help get them there. It saves money precisely because it fails – as millions of people lose access to health insurance, the “savings” for the federal government pile up. The states, meanwhile, lose billions of federal dollars and can do nothing to get out from under this restrictive federal mandate.
And, unbelievably, House Republicans seem to know that work reporting requirements—the marquee policy they have united around—will inflict pain upon enrollees and states. The House has set the implementation date for the proposed policy in 2029. Apparently, the Trump administration does not want millions of people to lose coverage until just after the next presidential election.
As we have explained many times, work requirements don’t actually have anything to do with work. They are an excuse to cut health care, including from workers who get tripped up by the government reporting requirements—bureaucratic red-tape at its worst. Similar proposals would have taken health insurance away from as many as 6.3 million people. Many people with disabilities, substance use disorders, and other health conditions will lose health coverage because they can’t get through the reporting requirements or are unable to successfully get an exemption intended to protect them. Congress also seems to know this, since it is proposing to dole out $150 million dollars in 2026 alone to states and the federal government to build the bureaucracy needed; these funds are on top of Medicaid matching funds that states can already draw down here – as Georgia has done.
You may notice the irony here. Congress is willing to spend $150 million dollars in just one year to build the bureaucracy that will cause people to lose their health insurance so that Congress can… save some money.