Abstract

Issue: Kentucky was the first state approved to implement a work requirement for adult Medicaid beneficiaries. A federal judge blocked implementation right before it was scheduled to take effect, but the program may be reinstated on appeal.

Kentucky was the first state approved to implement a work requirement for adult Medicaid beneficiaries. A federal judge blocked implementation right before it was scheduled to take effect, but the program may be reinstated on appeal. Goal: To examine several aspects of Kentucky’s Medicaid work requirements, including awareness and current work activities among Medicaid beneficiaries, and the potential impact of the policy on employment and health insurance.

To examine several aspects of Kentucky’s Medicaid work requirements, including awareness and current work activities among Medicaid beneficiaries, and the potential impact of the policy on employment and health insurance. Methods: Findings from telephone surveys of 500 low-income Kentuckians and 1,501 low-income Arkansans, ages 19 to 64, conducted in late 2018.

Findings from telephone surveys of 500 low-income Kentuckians and 1,501 low-income Arkansans, ages 19 to 64, conducted in late 2018. Key Findings and Conclusions: Nearly half (46%) of Kentuckians enrolled in Medicaid said they had not heard anything about the state’s plans for a new work requirement. Minorities and those with less education were less likely to have heard about the policy. Eighty percent of low-income Kentuckians reported they were unsure whether the requirement was in effect, and only 8 percent knew the policy was not in effect. Nearly all adults in Kentucky Medicaid surveyed were already working or otherwise meeting the state’s proposed work requirements. The survey found similar results in Arkansas, which implemented work requirements in 2018 and experienced higher uninsured rates, no increase in employment, and substantial confusion.

Background

In 2014, Kentucky expanded Medicaid under an executive order made by the governor. Kentucky’s uninsured rate among low-income adults dropped from 40 percent to 7 percent between 2013 and 2016. This expansion of coverage was one of the largest increases in health insurance experienced by any state.1 In early 2018, Kentucky became the first state to receive approval from the federal government to implement a “community engagement requirement” (also known as a “work requirement”) for its Medicaid enrollees.2 The program, part of the state’s “Kentucky HEALTH” Medicaid waiver, would have required nonelderly, nonexempt adults to participate in community engagement for 80 hours a month. Employment, job searching, volunteering, school, caretaking of family members, and participating in treatment for substance use disorder are all examples of community engagement activities.

In June 2018, U.S. District Judge James Boasberg ruled that Kentucky’s waiver was inconsistent with Medicaid’s intent and issued a stay that halted the rollout of the Kentucky HEALTH program two days before it was supposed to take effect.3 Meanwhile, Arkansas instituted a similar program for 30-to 49-year-olds that was in effect from June 2018 until March 2019, until the same judge ordered it to stop.

In this issue brief, we report findings from a November–December 2018 survey of 500 low-income Kentuckians (including 297 who reported having Medicaid coverage) that asked about their understanding of and experiences with the state’s work requirements and their current work or other community engagement activities. We compare the results of the survey to similar estimates from our survey of 1,501 low-income adults in Arkansas, the first state to implement work requirements. Details on the survey methodology have been published previously.4

Findings

Kentuckians’ Awareness of Medicaid Work Requirements

Many low-income Kentuckians had not heard about the state’s proposed work requirements. When asked whether they had heard about the new requirements, 45 percent of low-income Kentuckians overall and 54 percent of those with Medicaid said they had heard “a lot” or “a little” about work requirements. The remaining 55 percent of low-income Kentuckians and 46 percent of those in Medicaid reported they had heard “nothing at all” about the policy. Not all Kentucky Medicaid beneficiaries were subject to the new policy, which likely affected the rates of how many had heard about it.5

Awareness of work requirements was characterized by racial and educational disparities (Exhibit 1). Among self-identified racial minority Medicaid beneficiaries, 39 percent had heard something about the state’s work requirements, compared with 57 percent of white Medicaid beneficiaries. Forty-eight percent of Medicaid beneficiaries with less than a high school diploma had heard about the work requirements, compared with 62 percent of those with some college education. Awareness also varied by age group: 41 percent of Medicaid beneficiaries ages 19 to 29 had heard of the policy, compared with 58 percent of those ages 30 to 64 (data not shown). A multivariate regression model confirmed that minorities (p=0.04), people with lower levels of education (p=0.05), and younger adults (p=0.04) were significantly less likely to know about the policy. There were no significant differences by gender, marital status, or urban vs. rural residence.

There was also substantial confusion about the legal status of the work requirement program. As of late 2018, 80 percent of low-income Kentuckians were not sure whether the state’s work requirements were in effect. Twelve percent incorrectly thought they were in effect; only 8 percent knew the policy was not in effect (data not shown). This high level of confusion may have dissuaded some eligible individuals from enrolling in Medicaid.