It’s time to apply the principles of welfare reform to Medicaid.
In 1996, President Bill Clinton and congressional Republicans fundamentally changed welfare. To receive cash assistance and food stamps, participants had to work, train for work or apply for work. That requirement changed welfare from a hammock to a safety net, and the results were a win-win. This freed millions of people from welfare’s cycle of poverty. Former welfare recipients increased their incomes, and the number of people on welfare dropped 57 percent, according to a congressional report.
Unfortunately, Congress didn’t apply these standards to Medicaid. Fast forward 20 years, and the problems that plagued welfare in the early 1990s are now widespread in Medicaid.
Medicaid was originally intended to help the elderly and the disabled. But, as government programs always do, Medicaid has expanded well beyond its initial intent. Today, 75 million Americans are on Medicaid, including 28 million healthy adults. In 2000, the number of able-bodied adults on Medicaid was just 7 million. The biggest factor in that increase was the Medicaid expansion authorized by the Affordable Care Act.
Nevada is one of 32 states that has expanded Medicaid, offering it to healthy adults above the poverty line. The state’s Medicaid rolls have exploded as a result, rising 90 percent since 2013. More than 634,000 Nevadans are now enrolled in the federal program. But as funding from Washington inevitably declines, that increase is going to overwhelm Nevada’s budget.
Enter the Foundation for Government Accountability, a nonpartisan think tank, with a common-sense plan for Medicaid. In Nevada, the FGA used Census Bureau data to discover that 60 percent of the healthy adults on Medicaid didn’t work at all in 2015. Medicaid has became the same trap welfare was before reform.
“But when it comes to work requirements, Medicaid is well outside the mainstream,” write FGA authors Nic Horton and Jonathan Ingram. “Able-bodied adults can enroll without any requirements related to work or time limits.”
Mr. Horton and Mr. Ingram suggest putting a “20-hour-per-week requirement to work, train or volunteer.” Although it would require a waiver from the Trump administration, it wouldn’t require Nevada to wait on Congress to repeal and replace Obamacare.
The Obama administration had refused to consider such waivers. But last month, the president signaled his willingness to approve policy ideas intended to help control the soaring costs of the Medicaid program. Among those ideas is a work requirement, The New York Times reported.
“Let me be clear to everyone in this room: We will approve proposals that promote community engagement activities,” said Seema Verma, the administrator of the Centers for Medicare and Medicaid Services.
This is welcome news. As gubernatorial and legislative candidates talk about Medicaid, instituting a work requirements should be a central part of their platform.