There was also likely some hope among legislators that work requirements will place the obligation for health insurance onto the employer, thus reducing the government’s obligation to provide access to health coverage. Lastly, legislators also faced a pragmatic need to identify sources of savings in the legislation to offset tax breaks and other federal expenditures. The expected reduction in Medicaid spending, because of limiting coverage through mechanisms such as work requirements, was one solution that gained traction as the bill made its way through Congress.

Learning from the Past

Now that work requirements will be expected more broadly, it is important to learn from the experience of states that implemented work requirements even before the law was passed.

Case Study: Arkansas

Work requirements for Medicaid were first implemented in Arkansas in mid-2018 as part of the state’s Section 1115 waiver, which supported its Medicaid expansion program and was known as Arkansas Works.⁸ As part of the state’s Medicaid expansion, adults age 30 to 49 earning up to 138 percent of the federal poverty level of income (FPL) (~$28,000/year for a family of three in 2018) were required to engage in 80 hours per month of work or other qualifying activities, such as being full-time students, engaged in vocational training, or caregivers, and exempted those who were mentally or physically frail. Even those who received automatic exemptions had to renew them every other month, or they would lose that exemption.

Enrollees were required to report their work hours each month through an onerous process where failure to do so for three months in a row would result in the loss of Medicaid benefits for the remainder of the calendar year. Studies showed no increase in employment or hours worked in 2018 and 2019 because of the policy.⁹ In March 2019, just six months after the work requirements were implemented, a federal judge blocked the state from enforcing the requirements because the state “did not address concerns that would lead a substantial number of Arkansas residents to be disenrolled from Medicaid.” During Arkansas’ seven-month experience with Medicaid work requirements, more than 18,000 beneficiaries (one in four of those are subject to the requirement) were disenrolled from the state’s Medicaid program. Moreover, due to the burdensome process of reporting work hours and low public awareness, fewer than 1,500 people, or 11 percent of those who lost coverage in 2018, were able to re-enroll in Medicaid after losing coverage in 2019.