Medicaid Work Requirements at the U.S. Supreme Court: A Potentially Devastating Blow to Health Coverage for Millions

Leah H. Keller, Guttmacher Institute Adam Sonfield, Guttmacher Institute
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First published online:

Updated on January 28, 2021: 

On January 28, 2021, the Biden-Harris administration began reversing its predecessor’s harmful Medicaid policies when President Biden signed an executive order directing the U.S. Department of Health and Human Services to review and consider suspending, revising or rescinding any Medicaid policies and waivers, such as work requirements, that may reduce coverage, make it more difficult to enroll or otherwise undermine the program.  

First published on January 12, 2021: 

In spring 2021, the U.S. Supreme Court is scheduled to hear a case on the legality of imposing work requirements in the Medicaid program. Work requirements allow states to deny Medicaid coverage to people who are otherwise eligible by making coverage dependent on their ability to engage in work, educational pursuits or related activities for a certain number of hours per month.

This case is part of a long-standing campaign by conservatives—and especially those in the Trump-Pence administration—to undermine Medicaid. Other attempts include proposals for block grants and other types of federal spending caps on the program that would severely restrict its reach. These attempts to impede access to Medicaid coverage are cruel, arbitrary and run counter to the goals of the program.

If affirmed by the Supreme Court and widely adopted by states, work requirements in Medicaid would threaten health care coverage and sexual and reproductive health care access for many of the 76 million people with low incomes who rely on the program. These requirements do not encourage employment or education, and they are extremely burdensome to enforce. The Biden-Harris administration has an opportunity to protect Medicaid enrollees from this harmful policy, but it must act fast.

Work Requirements at the U.S. Supreme Court

In the coming months, the Court is expected to hear oral arguments in Azar v. Gresham concerning the legality of work requirements in Medicaid. It will be deliberating over whether the Trump-Pence administration had the authority to approve waivers of federal law that allowed Medicaid programs in Arkansas and New Hampshire to impose work requirements and other eligibility restrictions.

In February 2020, a three-judge panel on the U.S. Court of Appeals for the District of Columbia Circuit unanimously affirmed a lower court’s ruling and dismissed the Trump-Pence administration’s approval of work requirements. The court ruled that when the Centers for Medicare and Medicaid Services (CMS) approved waivers that included work requirements, it failed to consider whether enrollees would lose coverage and it ultimately undermined the "principal objective of Medicaid" to provide health care coverage.

As of January 2021, 19 states have applied for a waiver to impose a work requirement on at least some adult Medicaid enrollees, and CMS has approved 12 of those requests. None are currently being implemented, primarily because of various legal challenges. The Supreme Court’s decision will directly affect the ability of people with low incomes to receive Medicaid coverage in states that have approved work requirements.

Medicaid Is Critical

Medicaid is the central U.S. program for ensuring that people with low incomes have coverage for and access to reproductive health services, including family planning, pregnancy-related care, STI testing and treatment, cervical cancer–related care and services to address intimate partner violence. Medicaid alone accounts for three-quarters of all public dollars spent on family planning in the United States and covers costs for more than four in 10 U.S. births.

Medicaid is a widely used program that provides health insurance coverage for one in five people in the United States. It covers a disproportionate share of marginalized women, including those who are in poor health, have a low income, are single parents, have disabilities or are women of color. In 2018, for example, it covered 49% of reproductive-age women (aged 15–44) with incomes below the federal poverty level, and 61% of Black women in that income group.

Work Requirements Are Harmful

Work requirements ignore the reality of the Medicaid program and the people it serves, and can severely damage people’s ability to stay enrolled and get the sexual and reproductive health care that they need.

Although work requirements purportedly aim to encourage employment, most adults on Medicaid who are able to work already do so, and those who are not working have good reasons: having an illness or disability, taking care of their family, going to school, being unable to find a job or being retired. Furthermore, work requirements are administratively complex to track and enforce, and simple mistakes by enrollees or state agencies can lead to loss of coverage.

Arkansas provides a tragic example of the administrative burdens of work requirements. In the six months that the policy was in place, more than 18,000 Arkansans lost their Medicaid coverage. Research shows that many who lost their insurance found the requirement to be burdensome and confusing, and it did not incentivize them to get a job or job training, but rather pushed them out of Medicaid.

People who are unable to satisfy the Medicaid enrollment requirements may repeatedly gain and lose coverage, which can jeopardize their health by forcing them to forgo or delay seeking care and weakening the relationship with their medical providers. It also provides potentially coercive financial incentives for Medicaid enrollees to choose long-term or permanent contraceptive methods because of concerns that they may only have coverage for a short period of time.

Immediate Priorities for the Biden-Harris Administration

The Biden-Harris administration must take action to protect the integrity of Medicaid. On the first day of his term, President Biden should instruct the CMS administrator to rescind the Trump-Pence administration’s January 2018 letter that laid out guidelines for states to request work requirement waivers. This would both weaken the argument in favor of work requirements in the Supreme Court case and signal to state Medicaid agencies that the new administration will not approve such provisions in the future. The Biden-Harris Department of Justice should withdraw its support for the case, leaving officials in Arkansas and New Hampshire to argue the case by themselves.

The administration should also seek a speedy reversal of the waivers that are before the Supreme Court. CMS has the authority to discontinue waivers that it deems "no longer in the public interest" or contrary to the objectives of Medicaid, and states are entitled to a hearing to challenge such a decision. If the Arkansas and New Hampshire waivers are rescinded and the hearings completed before the Supreme Court hears the case in the early months of 2021, then the case would be moot. Even if this timeline is not possible, the administration should still rescind waivers with work requirements and other harmful provisions that block people from accessing health care—including sexual and reproductive health care—through Medicaid.