South Carolina asks for CMS' permission to impose work requirements without expanding Medicaid

South Carolina last month submitted a Medicaid waiver request to CMS that seeks to impose work requirements on certain Medicaid beneficiaries.

Background

The Trump administration has approved Medicaid waiver requests from nine states to implement Medicaid work requirements, but the administration's decision to approve the waivers has resulted in legal challenges—with three lawsuits currently challenging the legality of Medicaid work requirements.

A federal judge in March struck down Medicaid work requirements in Arkansas and Kentucky—a decision that some legal experts say eventually could reach the Supreme Court. However, CMS Administrator Seema Verma has indicated the rulings for now would not deter CMS from approving other state's requests for Medicaid work requirements. 

Most of the states that have gotten CMS' permission to implement Medicaid work requirements have expanded their Medicaid programs under the Affordable Care Act (ACA). CMS has been hesitant to approve work requirements in states where officials have not increased the income thresholds for Medicaid eligibility under the ACA, like South Carolina, because the states' current Medicaid eligibility requirements might disqualify residents from receiving both Medicaid coverage and federal subsidies for ACA exchange plans.

South Carolina seeks Medicaid work requirements

Despite those concerns, South Carolina in its Medicaid waiver request seeks CMS' permission to require certain able-bodied Medicaid beneficiaries to either be employed or enrolled in job training or school for an average of 80 hours a month to qualify for coverage. The state would exempt from the requirements beneficiaries who are disabled, enrolled in a substance use disorder treatment program, full-time caregivers, older than 65, pregnant women, and some others.

South Carolina's waiver request differs from other states' requests seeking to impose Medicaid work requirements because the state would not completely end a beneficiary's coverage and require the beneficiary to re-enroll in Medicaid if the beneficiary does not meet the requirements. Instead, in instances where beneficiaries fail to meet the requirements for three consecutive months, the state would suspend those beneficiaries' coverage for three months or until they meet the requirements.

South Carolina officials estimate the work requirements would apply to 188,000, or 16%, of the state's 1.2 million Medicaid beneficiaries. Officials estimated the state would suspend 7,100 affected beneficiaries' coverage in the first year of the waiver's implementation because of non-compliance or a failure to submit appropriate documentation to show they are complying or are exempt from the requirements.

The waiver would take effect no earlier than July 1, 2020, if CMS approves it, according to The Hill. CMS is accepting public comments on the waiver request through July 10 (Weixel, The Hill, 6/10; Romoser, Inside Health Policy, 6/10 [subscription required]).

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