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On Jan. 12, the Trump administration approved Kentucky Gov. Matt Bevin’s request to implement work requirements for able-bodied adults on Medicaid. The decision makes Kentucky the first state in the nation to win approval for these commonsense requirements.
Under the waiver, able-bodied adults on Medicaid will be required to work, train, or volunteer at least 20 hours per week as a condition of eligibility, mirroring work requirements in the food stamps program, which were created as part of the bipartisan welfare reform passed in the 1990s.
Bevin has been a national leader on this issue, having first submitted the waiver to the Obama administration in August 2016. Although Obama bureaucrats largely ignored the request, Centers for Medicare and Medicaid Services Administrator Seema Verma sent a clear signal to states last year that the new administration was open to the idea. Kentucky’s waiver approval comes just one day after CMS issued new guidance for states wishing to pursue these reforms.
Work requirements have a proven track record of moving adults out of dependency and back into the workforce. When states implemented similar requirements in other welfare programs, they saw able-bodied adults leave welfare in record numbers and find work in more than 600 industries as diverse as I.T. and nursing. Those leaving welfare saw their incomes more than double on average, leaving them better off than they were while trapped in dependency. Better still, the amount of time able-bodied adults were trapped on welfare was cut in half after these reforms were implemented. Overall, the reforms were followed by more work, higher incomes, and less dependency.
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The approval could not have come at a better time. According to state data, nearly 650,000 able-bodied adults are now dependent on Kentucky’s Medicaid program — nearly five times the number on the program in 2011. According to state data, many of them have no earned income, meaning they aren’t working at all.
And as enrollment has soared, so too have costs. Medicaid spending on these able-bodied adults sits at more than $4.5 billion per year — seven times what it was in 2011. As Gov. Bevin explained in his waiver application, these skyrocketing costs are jeopardizing funding for seniors, individuals with disabilities, pregnant women, and poor children.
Kentucky’s experiment with Obamacare has only made this problem worse. When then-Gov. Steve Beshear unilaterally expanded the program under Obamacare, his administration promised no more than 188,000 able-bodied adults would ever sign up. By the end of 2016, actual enrollment in the expansion sat at more than 466,000. Higher enrollment helped drive higher costs, with the expansion costing taxpayers $6 billion in the first three fiscal years alone — nearly twice what was promised. The Trump administration’s waiver approval will allow Kentucky to readjust its priorities and preserve resources for the truly needy and other critical public services.
Bevin’s leadership will give hope and opportunity to hundreds of thousands of able-bodied adults trapped in dependency. And as more than a dozen other states pursue similar reforms, the example set by Kentucky gives courage and encouragement to governors across the country. Bevin, CMS Administrator Verma, and President Donald Trump should be commended for their commitment to move more Americans from welfare to work. With Kentucky the first state to win approval for Medicaid work requirements, the only question left is which state is next?
Jonathan Ingram is vice president of research at the Foundation for Government Accountability.
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