Medicaid Rules on Time Limits
Time limits are not a part of Medicaid law. Medicaid law lays out how a person might qualify for Medicaid based on income and other “categorical eligibility” factors such as being disabled, a senior or pregnant in addition to elements like state residency and citizenship status.
Under Section 1115 of the Social Security Act, the Secretary of Health and Human Services (HHS) may waive certain statutory requirements for demonstration projects that promote the objectives of the Medicaid program. Placing limits on how long someone may receive Medicaid coverage, whether based on employment or other factors, falls well outside the statutory guidelines and is beyond Secretary’s authority to approve under Section 1115.
Nevertheless, states have requested waivers limiting non-elderly, non-disabled adults Medicaid eligibility, benefits or cost sharing based on factors like employment status. Others have suggested simply barring someone from coverage completely after a certain period of time on the program.
Arguments for keeping time limits out of Medicaid
There is a strong legal case against time limits.
- Time limits run directly counter to the objectives of the Medicaid program. The purposes of Section 1115 waivers is to allow the Secretary of Health and Human Services (HHS) to approve demonstrations that promote the objectives of the Medicaid program. The objectives of the Medicaid program is to furnish medical assistance to those who could not otherwise afford such care. A time limit on Medicaid-eligibility for those otherwise legally qualified for the program runs directly contrary Medicaid law, taking care away from eligible individuals rather than furnishing it.
- The Temporary Assistance for Needy Families (TANF) program proves that Congress must act for a time limit to be added to the program: The TANF program includes a hard five year limit on eligibility. However, this was not done through a waiver but instead an act of Congress. The current Medicaid statue does not permit eligibility be limited to any number of years, or cap time on program linked to work or other standards outside the current scope of the statute. Any limit on program eligibility must come through a revision in the statue by Congress, not a waiver.
Setting a time limit on how long someone can receive Medicaid based on employment status would harm low wage workers.
- Staying healthy allows people to find and maintain stable employment. Ohio’s Department of Medicaid found that Medicaid can reduce health barriers to finding or holding a job for beneficiaries who are not working: three-quarters of beneficiaries who received care under the state’s Medicaid expansion and who were looking for work reported that Medicaid made it easier to do so. For those who were currently working, more than half said that Medicaid made it easier to keep their job.
- Most low wage workers have employment in jobs with fluctuating schedules that may make it hard to meet requisite hourly requirements. Most Medicaid enrollees work in industries - like retail, home health care, construction and food service - that are seasonal, shift work, have frequent changes in hourly schedules or push people towards part time work. This can make it hard for them to meet the requisite work hour requirements, and put them at risk for losing their benefits.
Evidence shows that a time limit would not work in moving people out of poverty
- The TANF program is a prime example of time limits on public benefit programs increasing poverty. After the Temporary Assistance for Needy Families (TANF) program imposed a five year time limit, child poverty rose without strong evidence time limits improved workforce participation. There is no evidence that by adding a work requirement and time limit to TANF the program has increased workforce participation long term or decreased poverty.
- Medicaid improves financial stability. A limit on the program would increase family financial instability. Medicaid has been shown to increase financial stability among low-income families and reduce unpaid bills and personal debt. Medicaid helps people to move out of poverty and a time limit would reduce many of the gains in financial security we have seen as a result of Medicaid expansion.
- A time limit would increase hospital uncompensated care costs. A time limit that raises the rate of the uninsured would force people to seek care in the emergency room, where it is much more expensive and is often not the appropriate setting for them to receive the best and most efficient care. These uncompensated care costs that hospitals then face are passed on to state and local governments, insured patients, increasing healthcare costs for everyone.
A time limit would encourage people to put off health coverage and care leading to worse health outcomes
- A time limit would deter young, healthy people from enrolling in Medicaid. Time limits would de-incentivize healthy people from gaining coverage, fearing they may need it later and "saving" coverage for when they are older or sick. This negates public health goals that encourage people to have access to healthcare throughout their lives so that they can receive regular checkups and treatment and care for conditions at their earliest stages.
A time limit would increases costs and administrative complexity
States that have added additional requirements to their Medicaid programs that must be tracked, including premiums, cost-sharing, and health savings accounts, have seen increases in administrative costs. In TANF, tracking work requirement hours has been found to be so administratively cumbersome and expensive that resources are diverted from providing services to program administration.
If a time limit is approved: Advocacy suggestions to change the program.
As of August 2017, time limits had not been approved in any Medicaid program. As noted above, time limits are outside of the Secretary’s 1115 waiver authority, contrary to the purpose of Medicaid, a fundamental change in the statute, and an abuse of Secretary’s discretion.
If a time limit is approved in a waiver, advocates should start working to have the program reversed.
Include broad, easy to access exemption and hardship requirements
- Ensure any time limit includes exemptions for reasons such as health or disability status, caregiver status, student status, medically frail, mental health or substance use disorder etc. These exemptions should be allowed with attestation only and renewal should at shortest yearly. Community Health Centers, Rural Health Clinics, hospital Medicaid staff and enrollment assisters should be trained on exemptions and empowered to help individuals apply for such exemptions. Exemptions will never fully mitigate the harm of a time limit, but they can provide some nominal relief while you work to end the program.
Collect Evidence of the impact of the program.
- Require frequent (at least every six month) evaluations. Rigorous, objective evaluations of the programs—its effect on consumers, the state budget, the state economy and Medicaid administrative costs—will be critical in making the case. Try to get at trusted messenger like a University, non-partisan think tank or foundation involved to supplement any data the state releases.
- Clients adversely affected by the program are potential plaintiffs in any lawsuit. It is especially important in challenging time limits in a waiver that client injury is documented in detail. These clients and their stories will form the basis for future litigation to overturn a work requirement.
- Build a diverse coalition. Reach out to groups that might join a coalition to argue for moving away from time limits. This could include hospitals, chambers of commerce, patient advocacy and anti-poverty organizations, civil rights groups and others. All efforts should underscore the positive effects of Medicaid, both in terms of residents' health and the state economy, and the adverse impact of a time limit on state priorities.