The Trump administration has again approved Kentucky's Medicaid waiver, which requires beneficiaries to either get a job, volunteer in the community or go to school to keep their benefits.
Kentucky state regulators announced the approval on Tuesday, nearly five months after a federal judge blocked the state's first attempt. State officials say the new rules can begin as soon as April 1 and will be phased in regionally over several months.
They will require adults ages 19 to 64, with some exceptions, to complete at least 80 hours per month of "community engagement" to keep their health benefits. That includes getting a job, looking for a job, going to school, volunteering for community service or taking a job training course.
Kentucky is one of 37 states that has expanded Medicaid to include low-income adults with no children and no disabilities. More than 400,000 people signed up for the program, dramatically dropping the state's uninsured rate and propping up some rural hospitals who depend on the revenue.
But Republican Gov. Matt Bevin has criticized the program, saying it's too expensive and doesn't make Kentucky's citizens healthier as the state is still behind most of the country in some key health indicators.
Bevin proposed requiring some Medicaid recipients to take action to keep their benefits. In January, Kentucky became the first state ever to win federal approval for such a plan. But in June, a federal judge blocked it, ruling the government did not adequately consider how the plan would affect people who receive coverage.
The ruling held that the HHS Secretary Alex Azar's approval of the waiver failed to take into account the primary objective of the Medicaid statute, which is to furnish medical assistance. The judge sent the waiver back to the CMS for further review. It's possible the program could wind up in court again.
The new rules will be in place for five years. The Bevin administration predicted the requirements would save taxpayers more than $2 billion during that time, including $300 million in state dollars. State officials estimated at least 95,000 people would lose coverage, either through not complying with the rules or by getting jobs and earning enough money to make them ineligible for the benefits.
Arkansas was the first state to implement work requirements for Medicaid. Last week, the state announced more than 12,000 people had lost coverage in the past three months for not complying with the new rules. The Arkansas Department of Human Services said another 6,000 people are at risk of losing coverage by December if they do not comply.
Bevin, in a statement posted to his official Twitter account, said the approval means the state can "continue to provide services for traditional Medicaid beneficiaries, while also offering a path toward improved health outcomes for all recipients." Kentucky Cabinet for Health and Family Services Secretary Adam Meier said in a news release the new rules will help people have "success through long-term independence."
Kentucky Voices for Health, an advocacy group, said they were "deeply disappointed" with the decision.During the public comment process, Executive Director Emily Beauregard said thousands of Kentuckians said access to healthcare was vital to their ability to be productive and successful.
"Re-approving a waiver that makes hardworking Kentuckians jump through hoops to keep their coverage will no doubt have the opposite effect," she said.
The new rules do not apply to pregnant women, full-time students, former foster care youth, survivors of domestic violence, and primary caregivers of children and the elderly, among other exemptions. It would also exempt the "medically frail," a broad term that includes people suffering from alcohol and drug addiction.
Some benefits, including dental and vision, are no longer included. But people can earn those benefits back through a rewards program.
Under the Section 1115 five-year demonstration, beneficiaries could earn points in a My Rewards account that could be used to pay for dental and vision services beyond those covered under the regular Medicaid program. That might include restorative dental work and eyeglasses.
Beneficiaries would receive points in their rewards account by meeting Kentucky Health's requirement to complete 80 hours per month of employment or other community engagement activities and by participating in wellness activities such as filling out an online personal health questionnaire.
Indiana, Wisconsin and New Hampshire also have won approval for work requirements.
The Associated Press contributed to this report