OPINION: Medicaid work bill could hurt, not help, people who want to work

Legislation to require Medicaid recipients to work is racing through the Legislature. Last week, the Michigan Senate passed a bill that would impose 29-hour-per-week work requirements on many adults enrolled in the state’s Medicaid programs. The state House could take up the issue this week.

Michigan’s proposed work requirement is one of the most stringent put forward to date. The Senate bill does not provide funding for supportive services – such as child care, transportation, or job training – that could help individuals find work. As written, the legislation stands to lock some Michiganders out of health care and potentially keep them from working.

To understand why, consider who would be subject to the Senate’s Medicaid work requirement and how they could be impacted. Nearly 25% of Michiganders receive health care coverage through Medicaid. That’s about 2.5 million people. Many of the counties with the highest rates of Medicaid coverage are rural counties in the northern part of the state – more than 30% of those who live in Oscoda, Wexford, Roscommon, Iosco, and Kalkaska rely on Medicaid for health care coverage.

Of the 2.5 million Michiganders on Medicaid, 1 million would be affected by the Senate’s Medicaid work requirements bill.

The legislation allows for exemptions. Of the nearly 2.5 million Michiganders who have health coverage through traditional Medicaid or the Healthy Michigan Plan, 38% are children (age 0-18) and 6% are seniors (age 65-plus). Another 340,000 adults (age 19-64) are blind and disabled. These individuals would be exempt.

The Senate bill also includes exemptions for pregnant women, full-time students, caregivers of young children (age 0-6), those with medical conditions limiting their ability to work, those receiving unemployment benefits, and former foster care youth. Still, even those who would qualify for an exemption would be required to apply for one and submit proof. The required certifications themselves would likely be a significant barrier even for populations granted an exemption.

The majority of Michigan’s Medicaid enrollees are already working. According to estimates from the Kaiser Family Foundation, 60% of adult, non-disabled Medicaid enrollees in Michigan are working, and 75% of them live in a working family.

Medicaid enrollees with good health are more likely to be working more than those who report having fair or poor health. The Kaiser Family Foundation reports that 67% of Medicaid enrollees with excellent or very good health are working, and 65% of those with good health are working. Of those with fair or poor health, only 35% are working.

Medicaid enrollees who are not working often face substantial barriers to employment. Among the 40% of adult, non-disabled Medicaid enrollees who are out of work, the vast majority do not work due to illness or disability, caregiving responsibilities or school.

The Senate bill does not fund any services that could help individuals address these barriers and find employment. Without these supportive components, the goals of the bill are unlikely to be achieved. In 2016, child care alone cost an average of almost $7,000 a year in Michigan, almost a third of what an average restaurant worker in Michigan earned in 2017

There is substantial evidence that having health coverage contributes to individuals’ ability to work. The University of Michigan’s Institute for Healthcare Policy and Innovation recently surveyed Medicaid Healthy Michigan Plan enrollees. More than half of those surveyed reported that the coverage improved their ability to get and maintain employment.

It is unclear how many individuals would gain employment as a result of proposed work requirements. As lawmakers in the House of Representatives debate this legislation, we hope they consider the potential costs and benefits of this proposal carefully, and keep in mind the possible consequences for more than 1 million Michigan residents.  Without the necessary components to make a work requirement successful, many individuals could end up locked out of the coverage they need to actually get and keep jobs.