Feds approve Arkansas Works work requirement; lower income threshold still studied

Arkansas became the third state granted a federal waiver allowing it to require some Medicaid expansion beneficiaries to work, and it was the first to have it hand-delivered by the official responsible for it.

The federal government is still considering the state’s request to lower the income eligibility to 100% of the federal poverty level.

Seema Verna, administrator of the federal Centers for Medicare and Medicaid Services, signed the waiver and gave it to Gov. Asa Hutchinson during a press conference at the Capitol Monday. The waiver allows Arkansas to require beneficiaries of its Arkansas Works program ages 19-49 to work 80 hours per month or engage in other activities such as job training, job searching, education or volunteering, or some combination of those.

Arkansas will phase in the program, beginning with recipients ages 30-49 this year. Next year, recipients ages 19-30 will be required to work or engage in work-related activities.

The waiver will affect 39,918 beneficiaries this year, said DHS spokesperson Amy Webb. The state has 99,632 recipients ages 30-49, but 59,714 qualify for an exemption. Exempted beneficiaries include those who are medically frail, those who are pregnant, those who face a short-term incapacitation or are caring for an incapacitated person, and others. Arkansas Works covered about 286,000 Arkansans as of the beginning of the year.

The state will begin implementing the work requirement this month, and recipients will begin reporting their work activities June 1, said Department of Human Services Director Cindy Gillespie.

Hutchinson said Arkansas is the third state to be granted a work requirement waiver, but he expects it to be the first to implement it because it has been working on the waiver and the processes are ready. Beneficiaries will access Department of Workforce Services programs that will help them find and prepare for employment.

“This is not about punishing anyone. It’s about giving people an opportunity to work,” he said.

In addition to the three states whose work requirements have been approved, Verma said eight other states have submitted proposals, and nine other states are interested. Verma said this is the first time an administrator has hand-delivered a waiver. She said states are in a better position than the federal government to administer aspects of Medicaid.

“We are committed to working with states and being true partners in helping them get to where they want to go,” she said.

Arkansas’ waiver request also included a provision allowing it to lower the income eligibility threshold from 138% of the federal poverty level to 100%. That portion was not yet granted. Hutchinson and Verma said they did not want to wait for that process to unfold before implementing the work requirement.

“We’re still working through some issues in that particular area, but we wanted to move forward on the community engagement and work requirement piece,” Verma said.

Hutchinson said he had met with Health and Human Services Secretary Alex Azar while at the National Governors Association meeting in February and Azar was open to the idea. The Centers for Medicare and Medicaid Services is part of HHS.

Not all were excited about receipt of the federal waiver. The American Lung Association said the waiver will hurt those with lung diseases like asthma, lung cancer, and chronic obstructive pulmonary disease.

“The American Lung Association in Arkansas is deeply disappointed in Centers for Medicare and Medicaid Services’ (CMS) approval of the waiver, as it jeopardizes access to healthcare for many residents in Arkansas, including our most vulnerable residents. Arkansas has made great strides in improving the health of its residents since the state expanded Medicaid and the uninsured rate dropped from 19 percent to 11 percent,” Association Executive Vice President Martha Bogdan said in a statement. “Arkansas has the third highest lung cancer incidence rate in the country and its adult smoking rate of 23.6 percent is also one of the highest in the country. This waiver will simply make these grim statistics worse, as fewer people will receive treatment to quit smoking and screenings to detect lung cancer at an early and more survivable stage.”

ARKANSAS WORKS HISTORY, UPCOMING VOTE
Arkansas Works was created in 2013 as a result of the Affordable Care Act, otherwise known as Obamacare. The act required states to expand their Medicaid populations, but a Supreme Court decision required that states be given an option of whether to do so. Arkansas chose to expand, but it was granted a waiver by the Obama administration allowing it to use federal dollars to purchase private health insurance rather than expand Medicaid. The program originally was known informally as the private option.

The program has been controversial since it was created. Opponents have tried to block it by blocking the Department of Human Services Division of Medicaid Services appropriation. A three-fourths majority is required in the Arkansas Senate and House for all appropriations bills.

Legislative supporters of Arkansas Works do not yet have a three-fourths majority in the Senate. The process is complicated for supporters by the fact that three of the 35 Senate seats are vacated, but the three-fourths majority of 27 seats is still required.

Majority Leader Jim Hendren, R-Gravette, said the appropriation bill will move out of the Joint Budget Committee Monday or Tuesday and be on the floor the following day. It needs only a majority vote to advance through Joint Budget.

Asked if the waiver would be enough to convince opponents to support the appropriation, Hendren said, “I don’t know. I mean, it’s hard to get people to give me a straight answer. … I think it will help, and it will get us closer, but whether or not it’s going to push us over the edge, we probably won’t know until the vote is cast. We need a little drama around here, right?”