By
Anne Swerlick
|
November 7, 2017

Medicaid Premiums & Work Requirements: A Prescription for Higher Costs and Lower Health Insurance Coverage

This post was last updated on September 29, 2021. As new policies are announced, FPI will update this page.

As Florida’s response to COVID-19 takes front and center, concern grows for low-income families who struggle to take precautions against the spread of the virus. Although Congress has passed the Families First Coronavirus Response Act to address, at least in part,  the public health crisis and economic fallout from COVID-19, many barriers continue to keep struggling families from accessing the assistance they need during the pandemic. As Florida initiates policies implementing the Act and addressing other barriers to the safety net, FPI will update this form. When available, hyperlinks are provided to agency documents or statements that provide greater detail  about the new policy.

On March 22, 2020, FPI and 44 other organizations sent a letter to Governor DeSantis, leadership in the Legislature and agency heads to urge action on 47 specific policy changes to reduce unnecessary barriers for Florida’s safety net programs in response to the COVID-19 pandemic. See the letter here.

Abstract

Recent proposals to impose work and premium requirements on Medicaid beneficiaries pose a significant threat to health coverage for the most vulnerable Floridians. They would also add new costs and uncompensated care burdens for state and local governments, safety net providers and privately insured residents. Lawmakers should instead look to commonsense Medicaid policies with a track record of improving access to care.

During the 2017 state legislative session, proposed legislation would have imposed work and premium requirements as conditions of Medicaid eligibility. Although the bill did not pass, the same or similar proposals are likely to re-emerge in 2018.

Executive Summary

Decades of research and experience with other safety net programs show that these requirements, as conditions of Medicaid eligibility, run counter to the overall purpose of the program. Medicaid was created to provide low-income individuals and families access to health care services. Instead, these proposals would likely deter thousands of uninsured Floridians from initial enrollment and terminate eligibility for thousands of participants.

These requirements would also add significant new costs and uncompensated care burdens for state and local governments, safety net providers and privately-insured Floridians.

Proposed Medicaid work requirements are largely driven by false stereotypes. In fact:

  • Most Medicaid recipients who can work are already working.
  • Years of experience with the Temporary Assistance for Needy Families (TANF) program, including Florida’s program, demonstrate that Medicaid work requirements would not result in long-term stable employment for most participants or lift them out of poverty.
  • Medicaid coverage enables people to work or seek work because they can stay healthy or address health problems, which are often barriers to employment.
  • While the 2017 legislation exempted certain categories of beneficiaries from work requirements, such as people with disabilities, research shows that exemptions are costly to implement and not effective in protecting vulnerable participants.
  • Women, minorities, people with limited education and those with serious health problems particularly risk losing coverage due to work requirements.

Likewise, decades of research show that Medicaid premiums have deterred enrollment and resulted in loss of coverage.  For example:

  • In Florida, Medicaid financial eligibility is extremely restrictive; most participants are very low-income and struggle to afford minimal basic necessities.
  • Florida passed a Medicaid premium requirement in 2012, which was never implemented. One study projected that 800,000 children and their parents would have been dropped from the program because they could not afford a $10 monthly premium.
  • Premiums cause more people to cycle on and off the program. This cycling increases administrative costs and increases the average cost of care because healthier people are less likely to re-enroll after cancellation.
  • Premiums result in more uninsured families, which increases uncompensated care costs. These costs are shifted to state and local government, as well as health care providers.

Florida has made great progress reducing the number of uninsured, a steady decline from 20 percent in 2013 to 12.5 percent in 2016.  Adding premium and work requirements to Medicaid eligibility would be a step backwards, having the harshest impacts on children in low-income families and their parents.

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