Posted: 12 Mar. 2019 6 min. read

States can learn from each other in implementing work and other community-engagement requirements in Medicaid

By Jim Hardy, specialist executive, State Health Transformation Services, Deloitte Consulting LLP

We have seen myriad designs around work and community engagement requirements across the states. While the details might differ from state to state, core program elements (close alignment to job search and training, and clear communication of requirements) are likely to improve the chances that these programs will help move more people into the workforce.

Background

It has been a little more than a year since the US Centers for Medicare and Medicaid Services (CMS) announced that it would allow states to tie Medicaid eligibility (for certain population groups) to community engagement requirements. So far, eight states have received approval to implement such programs through Medicaid 1115 waivers. Another nine waiver requests are pending (see map, below). Before the end of 2019, at least four states will have introduced community engagement requirements—based on implementation dates included in approved waiver requests.

Some of these community engagement programs apply only to beneficiaries who gained coverage through Medicaid expansion. While each state has a slightly different approach, community engagement activities typically include working, attending school, training for a job, or participating in community service. Such requirements appear to have become table stakes for some states that want to expand Medicaid eligibility, as allowed under the Affordable Care Act (ACA). Proponents say community engagement requirements will help to move more unemployed, able-bodied, non-elderly Medicaid beneficiaries into the workforce and improve their health status. Opponents argue that the new rules could push some low-income people out of the Medicaid program.

Since 2014, 37 states (including Washington, D.C.) have adopted Medicaid expansion for individuals up to 138 percent of the federal poverty level (FPL) as allowed by the ACA. Many states that opted not to expand their programs have been feeling growing pressure from hospitals, health systems, providers, and consumer groups to not leave federal matching dollars on the table. They contend that expanding Medicaid eligibility could improve access to care for low-income residents, reduce uncompensated care costs, and lower uninsured rates.1 However, even with federal dollars covering 90 percent of expenses incurred by the Medicaid expansion population, states are still on the hook for the remaining 10 percent, which could be significant. The map below is based on data compiled by my colleague Shelby Brewer based on a review of state waiver applications.

Eligibilities

Requirements come in a variety of flavors

While CMS created the overall framework for community engagement waivers, the agency encourages states to test different program designs. In some states, for example, the requirements apply only to beneficiaries who gained coverage through expanded eligibility, while nine states have proposed work requirements for non-expansion populations—generally parents.2 This so-called state laboratory approach could help other states understand which tactics are the most effective at meeting the goals (e.g., higher workforce participation, better health status) as the waivers evolve.

Two areas of variation include the number of required hours for activity, and which beneficiaries are exempt from the requirement. While most states mandate a minimum 80 hours of qualifying activities per month, New Hampshire’s community engagement program (which went into effect March 1) requires 100 hours.

All approved and proposed waivers exempt certain members of the population from community engagement requirements (e.g., people who are medically frail, physically incapacitated, or pregnant). All other beneficiaries must regularly report their activities or risk losing coverage. Some of the variation in exemptions we have seen in our analysis of waiver applications includes:

  • Definitions of caregivers: It is common for states to exempt caregivers from the requirements for community activities, but states have defined caregivers differently. Ten of the 18 states that submitted waiver requests limit the caregiver exemption to parents of children younger than six years old.
  • Education exemption: Twelve waiver requests grant an exemption to full-time students, while some others exempt beneficiaries who are at least half-time students.
  • Exemptions for other special populations: This can include former foster care youths (five states), victims of catastrophic events (four states), recipients of unemployment benefits (eight states), recipients who are receiving cancer treatment (three states), and people who have been recently incarcerated (two states).

States should help beneficiaries comply with new rules

Regardless of how a community engagement requirement is structured, job search and job training support should be at the heart of any such initiative. States should work closely with their workforce-development programs to make sure they have the capacity to help beneficiaries meet the new requirements. States also should help beneficiaries understand the importance of compliance. Without strong support and communication, the new requirements could cause people to lose their health benefits unnecessarily. States and other stakeholders should consider how the following can be addressed:

  • Communicate requirements: Explaining program changes and new requirements to Medicaid beneficiaries can be challenging, particularly when it comes to enrollees who rarely use their benefits. Moreover, beneficiaries who are enrolled in a Medicaid managed care plan might mistakenly believe they are covered under private insurance rather than Medicaid and might not realize they have to comply with their state’s Medicaid work and related reporting requirements. States should consider a wide variety of communication channels (e.g., mail, phone, e-mail, public forums, internet, videos, social media) to effectively communicate the new requirements and the consequences of non-compliance. Medicaid programs should also consider working with community partners, health systems and physicians, and Medicaid managed care plans to help explain requirements to beneficiaries.
  • Build multiple paths for meeting the requirements: States are coalescing around a core set of activities that will count toward community engagement requirements outside of employment. Activities include employment (including self-employment), job searches, job training, community service, participation in programs that include a work requirement, and education (when education is not already an exemption). Five states include time spent providing care to someone outside of their own household, three states count participation in health-related classes, homeschooling is counted in three states, and five states include the number of hours spent in other work-related programs.
  • Determine how compliance will be reported: Beneficiaries might face challenges in reporting work activities—or exemption status—even after they are aware of the new requirements. States should determine what kind of documentation will be required and how the documentation will be validated. States also should help beneficiaries navigate the reporting requirements. They should consider a variety of communication channels (internet, phone, mail, email, and in-person in local offices) that beneficiaries can use to report their activities. Some states, such as New Hampshire and Kentucky, require individuals to meet the requirement every month. Other states, such as Indiana and Virginia, have “look-backs” to determine how many months an individual was in compliance. Beneficiaries who miss too many months are disenrolled. Beneficiaries are more likely to remain in the program if states make it easy to report compliance.

Each state might have its own ideas for moving beneficiaries toward employment. However, they all face similar challenges when it comes to communicating new community engagement rules to beneficiaries—and connecting them to resources that can help them comply. States are learning and adapting, and state Medicaid directors and other stakeholders are paying close attention to models that are being launched or proposed in other states.

Endnotes
1. Kaiser Family Foundation, “The Effects of Medicaid Expansion under the ACA” March 2018 (http://files.kff.org/attachment/Issue-Brief-The-Effects-of-Medicaid-Expansion-Under-the-ACA-Updated-Findings-from-a-Literature-Review)
2. Los Angeles Times, “In rush to revamp Medicaid, Trump officials bend rules that protect patients,” February, 6, 2019 (https://www.latimes.com/politics/la-na-pol-trump-medicaid-reforms-20180206-story.html)

 

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Jim Hardy

Jim Hardy

Specialist Leader | Life Sciences & Health Care

Jim is Deloitte Consulting LLP’s Medicaid Advisory Services lead. Previously Pennsylvania’s Medicaid director, he has more than 20 years of Medicaid, health policy, reimbursement and rate development experience. Recently, Jim assisted in developing a state Medicaid care management strategy and long-term care reform strategy; assisted states with coverage initiatives; and led a hospital payment reform initiative for quality incentives and to reduce payment for avoidable re-admissions.