BEYOND THE NUMBERS
Mississippi has updated its Medicaid waiver proposal in an apparent attempt to address one of the original proposal’s fundamental flaws — that it would create a catch-22 in which even enrollees who managed to comply with its work requirements could still lose their coverage. But the transitional help that the new proposal offers some enrollees wouldn’t fix the catch-22 problem, much less the even larger, core problem with Mississippi’s waiver — that its proposal to take Medicaid away from low-income parents who don’t work or participate in specified work activities for at least 20 hours per week will reduce access to care and worsen health outcomes for both parents and children.
Mississippi first submitted its Medicaid waiver proposal to the Centers for Medicare & Medicaid Services (CMS) early this year. Like other Medicaid work requirement proposals, Mississippi’s policy would cause thousands of people to lose coverage because they couldn’t meet the new requirements, with harmful consequences for their and their children’s health and financial security. A federal court recently rejected CMS’s approval of Kentucky’s Medicaid waiver —calling its approval “arbitrary and capricious” — because CMS hadn’t grappled with the coverage losses that would result from the work requirement and other waiver provisions.
But Mississippi’s proposal (both the old and new versions) raises an additional concern, one that seems to trouble CMS. It would create a severe catch-22: even parents who managed to comply with the work requirements could still lose their coverage, since working the required number of hours at a minimum-wage job would raise their incomes above the state’s very low Medicaid eligibility limits.
If a parent in Mississippi works the required 20 hours a week at the minimum wage, he or she would earn about $580 a month — too much to qualify for Medicaid in the state, where Medicaid eligibility is restricted to parents with incomes below 27 percent of the poverty line, or $370 per month for a single parent with one child. (See figure.) Such parents could end up uninsured for either of two reasons: first, few low-wage jobs (especially part-time jobs) offer coverage; and, second, with incomes below the poverty line, they wouldn’t qualify for subsidized coverage in the Affordable Care Act’s individual insurance marketplace — where people need to earn enough to reach 100 percent of the poverty line in order to get subsidized coverage.
Under the revised proposal, some parents would remain Medicaid-eligible under transitional medical assistance (TMA) for up to 24 months if they would otherwise lose Medicaid due to new or increased earnings and if they continue to meet the work requirement during the entire period. That’s an increase from TMA’s current 12 months, but it doesn’t solve the catch-22, both because TMA is time-limited and because not all parents with earnings would qualify. In general, to qualify for TMA currently, low-income parents must have met Medicaid eligibility requirements in three out of the last six months before their income rose above the state’s eligibility limit. Some parents, particularly new Medicaid enrollees, may not meet the requirement for prior coverage and thus may not qualify for TMA even if they fully comply with the work requirement after they enroll. For those who do qualify, many parents lose TMA coverage even before TMA’s 12-month eligibility period ends due to its onerous reporting requirements that apply during the last six months. Even more likely is that parents will lose coverage sooner because they can’t meet the work requirement in every month.
Simply extending the existing TMA program for an additional 12 months (compared to the status quo, and what it would have been under Mississippi’s original waiver) leaves the Mississippi proposal with all the same problems: TMA offers only temporary help and may not cover all of those affected. Thus, people who manage to comply with Mississippi’s work requirement still could lose their health coverage. That’s a flaw that undercuts the basic argument of those who support work requirement proposals — that they will encourage work by rewarding it.
The even larger problem with Mississippi’s proposal, which the new version does nothing to mitigate, is that many low-income parents will lose coverage because they can’t meet the new requirements — for example because they work in unstable jobs that don’t provide the required number of hours each month; because they’re tripped up by new paperwork requirements; because a disability, mental illness, or other health condition keeps them from working; or because they lack access to child care (which Mississippi’s proposal doesn’t provide). Losing coverage hurts not just parents, but their children, too. When parents lose coverage, children are less likely to get the care they need, families are less financially secure, and children’s short- and long-term health and development are at risk.