House Republicans are coalescing around work requirements in Medicaid as part of the massive budget blueprint the House adopted Tuesday.
But there’s one problem: They don’t increase employment, experts say. They do, however, result in people losing coverage.
The House budget resolution directs the Energy and Commerce Committee, which has jurisdiction over Medicaid, to find $880 billion in savings.
While no legislative language specifying the cuts has been released yet, work requirements have been part of the discussion as House Republicans scour for ways to pay for President Donald Trump’s $4.5 trillion tax cuts.
While Republicans are split on whether to embrace more substantial cuts to the joint federal-state program that, combined with the Children’s Health Insurance Program, provides health coverage to nearly 80 million Americans, they appear to have rallied around Medicaid work requirements, an almost innocuous sounding idea that also has the support of many Republican governors.
Republican leaders have said work requirements in Medicaid are common sense — healthy “able-bodied” adults should be required to work if they’re going to get health insurance through Medicaid.
“I think work requirements — most of our side agrees to that,” said House Energy and Commerce Chair Brett Guthrie, R-Ky., saying they would be targeted at the “able-bodied” Medicaid expansion population.
“Work is good for you,” said Speaker Mike Johnson, R-La. “You find dignity in work.”
But most of the people who would likely be subject to work requirements — adults who qualify for Medicaid in the 41 states and District of Columbia that expanded Medicaid — are already working, according to KFF, a health policy research organization.
Savings would more likely be generated through people losing coverage for failing to comply with reporting requirements, experts say.
“Work requirements do not work to get people employment,” said Avenel Joseph, interim executive vice president of the Robert Wood Johnson Foundation, a philanthropic organization focused on health outcomes. “Work reporting requirements work to cut people off of Medicaid.”
The Arkansas example
That’s what happened in Arkansas in 2018 under a program approved by the first Trump administration that required adults between the ages of 30 and 49 to work or do other work-related activities. The state later phased in a work requirement for those 19 to 29, in January 2019.
The state reported that more than 18,000 people lost coverage in 2018 during its rollout of work requirements before it was blocked by a court. Research showed the program did not lead to increased employment, but people did experience more medical debt and delayed health care.
The state reapplied to implement work requirements last month, with some changes.
Nationwide, most Medicaid recipients already work or would likely qualify for exemptions because of disabilities, child care responsibilities or illness.
Only 8 percent of Medicaid beneficiaries between the ages of 19 and 64 who do not qualify for disability or Social Security income — the age group most likely be subject to any proposed work requirements — are not working because of retirement, inability to find work or other reasons, according to KFF.
The outcome of any nationwide work requirement will depend on legislative language and how states implement the law, said Jennifer Tolbert, deputy director of the Program on Medicaid and the Uninsured at KFF, a health research organization.
But the risk is that people who are already working or would be exempt from those requirements because, for example, they have a disability, will get caught up in red tape and lose coverage.
“The reason why people will lose coverage is because of reporting requirements,” Tolbert said.
In Arkansas, she said, “it’s not that they weren’t working or would qualify for an exemption, but for a variety of reasons, they were unable to document their eligibility.”
In some cases, people didn’t even know about the new requirements, potentially because of housing instability, no access to the internet, or any other reason that could mean someone misses communications from the government.
Estimates have shown Medicaid work requirements can save the federal government money — not because they result in more employment and lift people out of the income requirements for Medicaid eligibility, but because many do not meet administrative requirements, like reporting to the state how they met those requirements.
Because the intention of work requirements is to save money to pay for Trump’s policy priorities, it is unlikely to include any spending on resources that help people find work, analysts say.
“It’s perfectly fair for the government to consider supporting work as a policy objective. I don’t disagree with that at all, but the way to accomplish that goal is not to cut people off their health insurance, because when people are healthier, [they are] more likely to be able to work,” said Joan Alker, executive director of the Center for Children and Families at the Georgetown McCourt School of Public Policy.
In 2023, the House passed a federal savings bill that included Medicaid work requirements for certain adults 19 to 55. Individuals would need to document 80 hours of work or similar activities per month, but it included exemptions for people determined by a physician to be “physically or mentally unfit for employment,” caregivers of dependent children or incapacitated people, people participating in a drug or alcohol treatment and rehabilitation, or enrolled in school at least part time.
A Congressional Budget Office estimate of that provision stated that by implementing the Medicaid work requirements, “the employment status of and hours worked by Medicaid recipients would be unchanged, and state costs would increase” while federal costs would decrease by $109 billion over 10 years. About 600,000 people could become uninsured, the CBO projected.
The bill would allow states to continue covering those people only if the state picked up the full cost. That could be difficult for state budgets, as the federal government pays about 90 percent of the costs of covering someone in the Medicaid expansion population. And many states want to reduce that population; the 2010 health care law allowed states to extend Medicaid to more low-income adults, making 138 percent of the federal poverty level — about $22,000 for an individual.
The Medicaid expansion population has grown to about 20 million people as of 2024.
“This policy doesn’t get people to work — it’s a backdoor way of cutting the program,” said Darbin Wofford, senior health policy advisor at Third Way, which describes itself as a left-of-center think tank. “Republican governors are more in favor of work requirements and are willing to implement them. That’s part of those governors’ goals, to reduce enrollment in Medicaid.”
Implementing such requirements costs money. Arkansas’ implementation cost $26.1 million, while a similar program in Georgia costs about $53 million in state and federal dollars.
Russ Vought, during his Jan. 22 confirmation hearing to head the Office of Management and Budget, defended work requirements.
“One of the major legislations that our, our side has been very proud of since the 1990s, was the impact of welfare reform in the 1990s,” said Vought. “That type of thinking should be applied to other federal programs.”
“And it’s informed not only Medicaid, but other programs to be able to encourage people to get back into the workforce, increase labor force participation and give people, again, the dignity to work.”
Full steam ahead
Guthrie said most Republicans are on board with including a work requirement policy for the Medicaid expansion population similar to what’s been proposed for the Supplemental Nutrition Assistance Program. These reforms, he said, would not affect “traditional Medicaid.”
”We saw what President Trump said, that he wants to be very careful on how we handle Medicaid,” Guthrie said, adding they want to ensure “people get benefits, but also make an efficient program.”
Other discussions around capping what the federal government pays for Medicaid per beneficiary, with growth for medical inflation, have been harder sells to moderate Republicans who are acutely aware of what a slowdown of Medicaid spending could mean for people and health care providers in their districts.
Guthrie said he’s “not sure there’s 218 votes for that.”
“Those are not as part of the conversation as they have been in the past,” he said.
Still, it’s unclear how the committee will find $880 billion in savings without cutting deep into the Medicaid program.
“We want to reform the system. We’re not going to do anything that has big impacts on the system,” Guthrie said.
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