As OpenSky previously reported, Governor Jim Pillen decided to opt Nebraska into a new set of work requirements for Medicaid recipients beginning today. The May 1 deadline is a full 8 months prior to the deadline imposed by the One Big Beautiful Bill Act and prior to final guidance being issued by the Centers for Medicare and Medicaid Services. Nebraska’s work requirements will impact adults in the Medicaid expansion population without disabilities (adults 18-64 making less than 138% of the federal poverty level). The requirements mandate 80 monthly hours in work-related activities (paid work, volunteering, education, etc.) as well as recertification every 6 months beginning in January, 2027. Nebraska voters approved Medicaid expansion in 2018 by more than a 7% margin, which has since had a significant impact on reducing the percentage of uninsured individuals in the state.
However, work requirements will reverse that trend, as Governor Pillen estimated during a press conference announcing the early adoption that he estimates approximately 30,000 Nebraskans will lose Medicaid coverage. The Department of Health and Human Services (DHHS), which will be responsible for the additional workload of frequent verifications, has indicated they will not hire additional staff members, which is likely to cause delays and potential gaps in coverage.
Medicaid work requirements are not a new concept, as states like Arkansas and Georgia have attempted to implement them for recipients, only to change course. According to KFF, a health policy think tank, most adults who receive benefits under Medicaid already work or should be exempt from work requirements due to an inability to work. Federal data shows that 64% of adults receiving Medicaid were already working, with an additional 12% caring for dependents, 10% having health conditions or disabilities that prevented them from working and 7% attending school. Of the entire population of Medicaid recipients, only 8% were not working or unable to find work.
The Arkansas program has been the only one in the nation so far that disenrolled participants who did not meet work requirements. However, that showed no meaningful improvement in the rate of workforce participation by Medicaid recipients. The program was in place for less than a full year, from June 2018 to March 2019, but 17,000 Arkansans lost coverage, a full quarter of participants, overwhelmingly due to onerous paperwork requirements. Researchers analyzed the long-term impact of this loss of coverage and noted increased medical debt, lower medication compliance and delays in accessing health care.
Exemptions to the new work requirement rule are made for certain individuals, including those who are pregnant and medically frail. However, medical frailty definitions are primarily left to states to decide, including the process by which an individual attests to having a qualifying condition. Nebraska’s process includes a list of specific diagnostic codes that an individual must have in their medical records in order to provide an attestation to the Department of Health and Human Services, which then must be reviewed and approved. The list can be amended by DHHS, and the Department may ask for additional supporting documentation. Participants have 30 days to respond or their coverage will be terminated.
All new Medicaid enrollees in the expansion population as of today will be required to meet these new work requirements unless an exemption is granted. Existing enrollees will begin losing coverage on August 1 if they are out of compliance or unaware of the new requirements.
OpenSky Policy Institute will be providing updates on how these regulations will impact Medicaid recipients, the already-beleaguered Nebraska health care landscape, Nebraska’s fiscal picture, and long-term health outcomes for our neighbors.