January 2, 2020

CMS late last month approved Utah's waiver request to expand the state's Medicaid program under the Affordable Care Act (ACA) and implement work requirements for some beneficiaries.

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CMS' decision to approve the work requirements suggests the Trump administration has no plans to halt its efforts to reshape Medicaid, despite legal challenges that have prompted a growing number of states to pause their efforts to implement Medicaid work requirements.

Background

Under the ACA, states expanding their Medicaid programs must offer coverage to individuals with annual incomes up to 138% of the federal poverty line (FPL). The federal government currently covers at least 90% of the cost of expanding Medicaid to individuals with incomes up to 138% FPL.

Last year, 53% of Utah voters approved Proposition 3, which directed the state to expand Medicaid coverage to individuals with annual incomes up to 138% FPL and implement a 0.15% sales tax on nonfood items to cover the state's cost of the expansion.

However, Republican lawmakers in the state raised concerns that the ballot initiative's sales tax would not generate sufficient funds to cover the state's expansion costs and introduced a bill to allow Utah to seek federal permission to scale back the expansion.

The bill was approved, and state officials submitted a Medicaid waiver request to CMS seeking a partial Medicaid expansion, as well as other changes to the state's Medicaid program. CMS approved that request with a federal match of 70% of the cost of Medicaid expansion, as opposed to the 90% matching rate of a full-scale expansion.

In response, Utah in November 2019 submitted an updated request to CMS for a full Medicaid expansion under the ACA.

CMS OKs Medicaid expansion with work requirements

The approved waiver allows Utah to expand the state's Medicaid program to adults with annual incomes up to 138% FPL, which is equivalent to $16,753 for an individual and $34,638 for a family of four, according to the Deseret News. The expanded Medicaid program took effect on Jan. 1, 2020. An estimated 120,000 state residents are eligible for Medicaid coverage under the expanded program, according to the News.

The waiver requires beneficiaries who are covered under the Medicaid expansion to complete an online job assessment, online training programs, and 48 job searches within the first three months of their enrollment in the program. If affected beneficiaries do not meet those requirements, the state will end their coverage, the News reports. State officials have projected an estimated 6,000 to 8,000 Medicaid beneficiaries will not comply with the requirements.

The waiver exempts from the work requirements beneficiaries who care for young children, are older than 60, are pregnant, work at least 30 hours per week, and some others. State officials have estimated 70% of Medicaid beneficiaries will be exempt from the work requirements.

The state under the approved waiver requires Medicaid beneficiaries to enroll in employer-sponsored health insurance if they are eligible. Under the waiver, the state's Medicaid program covers premium and other out-of-pocket costs for beneficiaries who enroll in employer-sponsored health plans.

Utah's approved waiver allows the state to provide dental benefits to beneficiaries ages 65 and older and coverage for dental crowns to beneficiaries who are elderly, as well as those who are undergoing substance use disorder treatment.

CMS did not approve Utah's request to allow the state to charge premiums to adults Medicaid beneficiaries with annual incomes above 100% FPL, lock beneficiaries out of Medicaid coverage for intentional program violations, require a $10 surcharge for each visit to an ED for non-acute problems, or provide housing supports to certain beneficiaries. CMS is separately considering whether to approve those outstanding requests, the Associated Press reports.

Comments

CMS said Utah's approved waiver is "innovative and sustainable.

Herbert said the approval shows "states can craft viable, unique solutions to deliver critical health care services to their residents."

Similarly, Nate Checketts, deputy director at the Utah Department of Health, said state officials argue Utah's Medicaid work requirements are different than those approved in other states because the requirements aim to help beneficiaries look for work rather than have them meet a certain number of work hours.

Jenny Johnson, Utah Department of Health public information officer, said, "With the Medicaid expansion, now there's going to be a lot more individuals eligible to apply for Medicaid and a good majority of those could potentially be in rural areas where the income level is not as high."

But Stacy Stanford, a policy analyst for nonprofit Utah Health Policy Project, said, "There's a big asterisk attached to this full expansion, because this work reporting requirement is a paperwork barrier for people who have been waiting so long to get access to health care. Now, they finally qualify if they check the right boxes and turn in the right forms, and cross these hurdles in order to get the care they need."

Chase Thomas, executive director of Alliance for a Better Utah, in a statement said, "The bad news is that this expansion continues to be based on the harmful, conservative ideologies of a majority of our [state] Legislature, rather than the compassionate plan that was passed by a majority of Utahns." Thomas added, "Although over 100,000 Utahns are now eligible for Medicaid, the bureaucratic hurdles imposed by new work requirements could prove to keep otherwise eligible individuals and families from receiving the medical coverage they need. In addition to violating the compassionate spirit and intent of Proposition 3, we're sure that Utah courts will agree with courts in Kansas and Arkansas that have found work requirements violate the intent of the Medicaid program" (Wilson, Healthcare Dive, 12/24/19; AP/Modern Healthcare, 12/23/19; Imay, Deseret News, 12/23/19; Weixel, The Hill, 12/23/19; Richardson, St George News, 12/24/19).

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