Medicaid is not a “workfare” program. It’s our nation’s primary method of covering health care for low-income Americans.
Seema Verma, President Donald Trump’s nominee for Administrator of the Centers for Medicare and Medicaid Services, wants to change that. Although her nomination hasn’t garnered much press to date, it deserves more attention. Verma’s lack of experience with Medicare and with running a large agency are bad enough. But the harmful effect her policies could have on state Medicaid programs and their beneficiaries, in conjunction with likely congressional actions, is even worse.
Except with respect to the most fragile and vulnerable beneficiaries, Verma regards Medicaid not as a health care program but as a temporary pathway “for people to lift themselves out of poverty toward a state of self-sufficiency.” Toward that end, she believes states should have greater leeway in designing their Medicaid programs as they see fit. Most notably, she supports state efforts to treat Medicaid as a training program to make low-income, “able-bodied” Medicaid beneficiaries into responsible, gainfully employed, privately insured members of society. She points to the Healthy Indiana Program, on which she worked under then-Governor Mike Pence, as a model for other states.
There are several problems with this vision.
First, it assumes that the poor are uninsured because they are lazy, do not know how to live properly, and need states and local governments to tell them how to behave. But this belief isn’t borne out by the facts. Most Medicaid beneficiaries live in working families. And at least one study has linked the Affordable Care Act’s Medicaid expansion to greater employment by disabled individuals.
Second, this vision puts distressingly little store in Medicaid’s function as the nation’s primary safety-net provider for the poor. Medicaid covers 76 million Americans, many of whom were among the long-term uninsured before the Affordable Care Act. Medicaid is meant to give low-income Americans, whose employers typically do not offer coverage, the same access to health care that Americans who earn more typically enjoy.
Third, this vision doesn’t work. Even though Indiana has been inordinately protective of some of the data from the Healthy Indiana Program, the data that are available do not inspire confidence. It suggests that the program makes beneficiaries “more responsible,” as judged by their emergency department use and payment to continue coverage by the Healthy Indiana Program. The association between the two and increased responsibility is dubious at best.
We do know, though, that the Healthy Indiana Program costs a lot more than traditional Medicaid. The last Medicaid quarterly financial review, which was once publicly available on Indiana’s government website, showed that while traditional Indiana Medicaid beneficiaries receiving risk-based managed care cost an average of $293.48/month from July 2011 to December 2011, comparable adults covered by the Healthy Indiana Program cost between 140 percent and 290 percent more, even after omitting data from the sickest program beneficiaries.
Yet the Healthy Indiana Program doesn’t offer more benefits than traditional Medicaid. We also don’t know if its beneficiaries have better health outcomes than traditional Indiana Medicaid beneficiaries, because Indiana has publicly released little data that might allow such a comparison.
We don’t know what Congress and the Trump administration will do to Medicaid. However, to the extent they retain at least some existing federal program requirements, it is likely that many conservative states will seek Verma’s approval for Medicaid plans that look like the Healthy Indiana Program, or worse. To the extent that states want to tie Medicaid to repressive work and personal responsibility requirements, Verma will likely give them a green light.
To be sure, job training and placement assistance, if done right, can play a positive role as one part of a holistic approach to health and social supports for the poor. And no one seriously believes that irresponsibility and sloth should get government support. However, there is little evidence to support Verma’s strategy of spending scarce Medicaid dollars on the punitive measures that she and her supporters champion.
The Senate will likely confirm Verma. However, both Congress and interested states should think twice before seeking to implement her vision for Medicaid. That vision will only squander public funds on wrongheaded theories that remain unproven even after eight years of testing in Indiana.
Laura Hermer, JD, is professor of law at Mitchell Hamline School of Law in St. Paul, Minn., and director of the school’s JD/MPH programs.