DHS Director Cindy GIllespie (file photo). BRIAN CHILSON

Arkansas’s first-in-the-nation work requirement for certain Medicaid beneficiaries expanded in January to include some 45,000 additional people, according to a monthly report from the state Department of Human Services released on Friday. The new group subject to the rule includes the first cohort of beneficiaries in the 19-29 age range. Last year, the policy applied only to those ages 30-49.

In 2018, 18,164 people on the Arkansas Works program — the state’s name for its hybrid public-private version of Medicaid expansion — lost their health insurance because of the work rule. A study published by the Kaiser Family Foundation in December found many beneficiaries were unclear about how to stay in compliance with the policy, which includes complex rules regarding exemptions and reporting. Anecdotally, some of those who lost coverage were working but did not report their hours to the state.

If a beneficiary fails to report sufficient work hours for any three months in a calendar year, he or she is kicked off Arkansas Works and locked out of reapplying until the next year begins. Out of the 18,164 who lost coverage last year, 1,452 have applied for and regained coverage so far in 2019, the new DHS report says.

Because the three-month clock resets with a new calendar year, no beneficiaries lost coverage in January due to the work requirement. However, 10,258 of the 105,158 people subject to the rule were out of compliance last month.

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If those beneficiaries also fail to meet the requirement for February and March (or any other two months in 2019), they will be locked out of the program for the rest of the year. The policy requires beneficiaries to work at least 80 hours each month or complete an equivalent amount of school, volunteer hours or certain other activities.

The DHS report says 94,900 “met [the] requirement due to work, training, or other activity” in January. But the vast majority of those people did not report anything to the state. Over half of them (50,107) were simply assumed to be employed for at least 80 hours, an assumption DHS based on income information the agency has on file. Another 43,220 qualified for an exemption because of various life circumstances, such as having a dependent child in the home.

Only 1,573 beneficiaries actually reported “work activity” hours to DHS in January — less than 2 percent of those subject to the requirement.

The January numbers also highlight the ongoing issue of people losing coverage for reasons besides the work requirement. There were 13,503 Arkansas Works cases closed last month, mostly for what might be called “paperwork compliance” issues. Over half of the closures were because a beneficiary changed addresses or did not respond quickly enough to a letter from DHS. That continues a trend seen in the program throughout the last year.

Arkansas Works enrollment has been reduced by around 100,000 over the past two years. It peaked at around 330,000 in January 2017; on Feb. 1, 2019, it was about 234,400.

DHS also released its monthly Medicaid enrollment and expenditure report on Friday. In addition to Arkansas Works, 240,349 adults were enrolled in traditional Medicaid categories, including disabled people and elderly beneficiaries. ARKids, the state’s insurance program for children, included another 405,322 beneficiaries. Only Arkansas Works enrollees are subject to a work requirement.

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This reporting is published courtesy of the Arkansas Nonprofit News Network, an independent, nonpartisan project dedicated to producing journalism that matters to Arkansans. Find out more at arknews.org.

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A few technical notes on the January numbers:

1) The 19-29 age group, like the initial 30-49 group last year, is being added to the work requirement in stages. One-quarter of the 19-29 group became subject to the requirement in January. Another quarter was added in February, with the remaining people to roll on in March and April.


2) The number of people subject to the work requirement shot up last month. In December, there were only 60,680 subject to the rule. In January, there were 105,158. That increase is partly because of the new age cohort, but it doesn’t account for all of the difference. The state also added another new group of 30- to 49-year-olds: Those whose incomes exceed 100 percent of the federal poverty line.

Previously, this group of people was exempt from the requirement, partly because the state originally sought approval from the Trump administration to make them entirely ineligible for Arkansas Works. (Medicaid expansion, as created by the Affordable Care Act, is available to adults making between 0 and 138 percent of the poverty line.) But while federal Medicaid authorities approved Arkansas’s waiver creating the work requirement, they did not approve the state’s bid to reduce eligibility to 100 percent FPL.

DHS spokeswoman Marci Manley wrote in an email that all the 30-49 year olds in the 100-138 FPL income range were brought onto the work requirement in January; there were 28,349 in this group.

However, this may have little practical effect in terms of future coverage losses, because the state automatically exempts from the reporting requirement anyone whose monthly income is above $740. (That’s the state minimum wage — as of Jan. 1, $9/hour — multiplied by 80 hours per month. To determine income, DHS typically looks at the beneficiary’s initial application for Arkansas Works or his or her annual redetermination paperwork — a number which may often be inaccurate, considering the high turnover rate in low-wage jobs.)

That means most of the people in the 100-138 FPL income range should be exempt from reporting, though not all. Manley wrote in response to this question:

The 100-138 percent FPL is based on the household FPL. So, you could have a household (say two individual adults living in it) who both apply for Arkansas Works coverage. One of those individuals is employed and makes all the income for the household, the other doesn’t have an income. While eligibility is based on household income, the work and community engagement requirement is tied to the individual.

 

So, in the above example the person who was making all the income in that 100+ FPL household would be exempt from reporting, while the other would be required to report (barring another exemption applying to them which we would still likely need to be told about).

 

Of those 28,349,  only 3% (925 individuals) did not already have an identified exemption. So, most of the individuals are already meeting the requirement. Others will need to report activities or a life situation/reporting exemption to us.