Four years ago, the Biden administration rolled back a controversial rule that required Medicaid beneficiaries to work in order to receive coverage. Work requirements seem a possibility again with President Trump back in office, but a new KFF analysis finds that most people with Medicaid coverage are currently already working.
In 2023, most Medicaid adults under age 65 were working – among those who don't receive benefits from Social Security disability programs, Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI), and who are not also covered by Medicare, 92% were working full or part-time, or not working due to caregiving responsibilities, illness or disability, or school attendance.
The remaining 8% of Medicaid adults reported that they are retired, unable to find work, or were not working for another reason.
Those in better health and with more education are more likely to be working, the numbers showed. Seven in 10 people in excellent health, ages 30-39, and who have a college degree, were working, compared to just four in 10 (44%) people in fair health, less than half of older adults ages 55-64 (48%), and 56% of those who did not complete high school.
Parents were more likely to be working than adults without a dependent child in the home (72% vs. 58%), in part because parents are younger and less likely to have a disability, according to KFF.
WHAT'S THE IMPACT
There are some barriers to employment for many Medicaid individuals, particularly those with disabilities. Defined as having at least one serious difficulty with hearing, vision, cognitive functioning, mobility, independent living or self-care, about 32% of those with a disability receive disability income (SSI or SSDI) leaving nearly seven in 10 adults on Medicaid with a disability who do not receive disability income.
Medicaid adults with a disability are less likely to work than Medicaid adults with no disability, at a rate of 37% vs. 68%, numbers showed.
The number and types of disabilities are also a factor. While nearly half (48%) of Medicaid adults with one disability were working, fewer than one in five (17%) Medicaid adults with four or more disabilities were working. And four in 10 Medicaid adults with visual or hearing disabilities were working while those with disabilities related to independent living and self-care – difficulties that often result in the need for long-term care services – had the lowest rates of employment (21% and 16%, respectively).
About 70% of Medicaid adults worked full-time, and 50% worked full-time for the entire year, while 31% of Medicaid adults worked part-time, citing reasons such as the inability to find work, business conditions and workplace-mandated shorter work weeks.
Many working Medicaid adults are employed by small firms. Firms with fewer than 50 employees are not subject to ACA penalties for not offering affordable health coverage and are less likely to offer health insurance to their workers than larger firms, according to KFF.
In 2022, just over half (53%) of firms with fewer than 50 employees offered health insurance to their workers compared to 98.7% of firms with 100 or more employees.
THE LARGER TREND
With the shift in administrations, Medicaid work requirements are once again in the legislative mix; a draft budget outline from Congressional Republicans includes requiring Medicaid enrollees to work or look for work as a condition of receiving coverage.
While the details of the current proposal are not yet available, an analysis of an earlier proposal by the Congressional Budget Office shows that Medicaid enrollment would drop and that federal spending on Medicaid would be reduced substantially, but that the policy would not increase employment.
The first Trump administration encouraged states to apply for Section 1115 waivers that included work and reporting requirements as a condition of Medicaid eligibility. For the first time in the history of the program, the administration approved waivers in 13 states. Arkansas was the only state to implement the policy with consequences for noncompliance, resulting in 18,000 losing coverage for failure to meet work or reporting requirements. Courts struck down many of the waiver approvals, including in Arkansas, and the Biden administration rescinded the remaining waivers, or they were withdrawn by the states.
Currently, Georgia is the only state with a work requirement waiver in place, following a legal challenge to the Biden administration's move to rescind it.
Jeff Lagasse is editor of Healthcare Finance News.
Email: jlagasse@himss.org
Healthcare Finance News is a HIMSS Media publication.