Arizona Medicaid Waiver Proposal Wages War on the Poor

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September 30, 2015; Stateline

Arizona governor Jan Brewer was one of the very few Republican governors in southern or western states to go along with the Affordable Care Act option of expanding income eligibility for Medicaid. Presumably, she realized that spurning the new moneys offered by the federal government and leaving a swath of Arizonans without possibilities of affordable healthcare insurance would be, in the end, costly to the state (providing medical care for the uninsured) and counterproductive.

Brewer’s successor, reports Stateline writer Michael Ollove, is pursuing a tack that would roll back Medicaid eligibility in a distinctive way. Governor Doug Ducey has asked the Obama administration to approve a waiver that would limit Medicaid eligibility in Arizona. Ducey’s plan would require existing and prospective Medicaid recipients with the capacity to work to have a job, be looking for a job, or be participating in job training. Adult Medicaid recipients would generally be limited to five years of eligibility. In addition to the work requirement and time limitation, Medicaid recipients would be required to contribute to health savings accounts, but the resources in those accounts, Ollove reports, could only be used if the Medicaid recipients “met work requirements or engaged in certain types of healthy behavior, such as completing wellness physical exams or participating in smoking cessation classes.”

Ollove says that the federal government has never given states Medicaid waivers that would establish work requirements or five-year time limits for eligibility. If this reminds you of something, think about the many proposals that have been floated in recent years to impose work and time-limit eligibility restrictions for food stamps.

Ollove quotes Joan Alker, executive director of the Center for Children and Families at Georgetown University, who points out the “punitive strain” in the proposals and the “assumption that, left to themselves, people will make bad choices and that we the government will make better choices for them.” It is an interesting anomaly to find conservatives in government who generally believe in choice denying that choice to people who happen to be low-income or minority, based on the idea that the poverty of poor people is due to their own bad decisions or their inability to make good ones.

Ollove notes that other states have requested and received waivers allowing them to add new requirements to state Medicaid programs:

  • Arkansas, Indiana, and Michigan got approvals for incentivized or mandatory Medicaid recipient contributions to Health Savings Accounts to be used toward patients’ insurance copays or for treatments not covered by Medicaid—though no state has been given the approval to restrict access to HSAs as Arizona has requested—and Arizona could suspend Medicaid recipients’ eligibility for six months if they fail to make their mandatory two percent of income contributions to HSAs.
  • Indiana got approval to charge a “premium” to all Medicaid recipients, with the provisions of being able to cancel eligibility for six months for recipients above the poverty level if they don’t make their premium payments and loss of enhanced medical care such as vision or dental for those below the poverty level.
  • Indiana, Iowa, Michigan, Minnesota, and New York, says Ollove, “include what are called ‘healthy behavior incentives’ in their Medicaid programs, to nudge people to lose weight or stop using tobacco.”  However, those states all try to incentivize healthy behavior, but Arizona would use penalties instead of incentives.
  • Indiana and New Hampshire were not given approval for a work requirement, but they were approved to make a referral to job training or a job as part of the package of services that a Medicaid recipient would receive.

Nonprofits in Arizona and around the nation have reacted negatively to the Arizona plan. Tara McCollum Plese of the Arizona Alliance for Community Health Centers, for example, noted that these punitive restrictions are inconsistent with the “safety net” purpose of Medicaid.

There is a major nonprofit-like entity that has endorsed the Arizona proposals: Americans for Prosperity, the conservative activist group co-founded by Charles and David Koch. The organization’s Arizona policy analyst, Boaz Witback, explained the rationale simply: “It reduces dependency on government and encourages able-bodied folks to work.”

There is enough information on programs that work and don’t work to tell Ducey and other Arizona public policy decision-makers that most Medicaid recipients work, that the proposed punitive work requirements will likely be counterproductive, that HSA programs might be expensive to operate and not particularly efficient, and that wellness programs have been shown to be of little productive use. That clearly isn’t really what is behind the Arizona idea. It is yet another program meant to make decisions on behalf of poor people because of conservatives’ belief that poor people are poor due to their own decision-making shortcomings. Score it as one more state effort to redefine “anti-poverty” as “anti-poor.” –Rick Cohen