It was March 2020, and Robert Gordon was about to kick some 80,000 people off health insurance.<\/p>\n
As the Michigan state health director, he had spent the past year, and some $30 million in state tax dollars, trying to avoid that very thing.<\/p>\n
Gordon was a Democrat, a veteran of the Obama administration<\/a>, and he did not want people to lose the Medicaid coverage they had recently gained through the Affordable Care Act.<\/p>\n But Gordon and his boss, Democratic Gov. Gretchen Whitmer, had reluctantly inherited a law<\/a> passed two years earlier, when Republicans led the state. And that law mandated that Michigan institute a work requirement for Medicaid on Jan. 1, 2020.<\/p>\n Gordon and his team determined that most enrollees were already meeting the law\u2019s requirements, either because they were already working or had an exemption. Thousands more reported their status through the newly built phone and online systems.<\/p>\n But even so, estimates suggested 80,000<\/a> to 100,000<\/a> Michiganders were going to be booted off the rolls within the year.<\/p>\n \u201cThat\u2019s the population of the city of Flint who were on track to lose their insurance,\u201d said Gordon, who led the state health department until 2021. \u201cWe\u2019re implementing this about as well as this thing can be implemented, and it is still going to be pretty catastrophic.\u201d<\/p>\n The new tax-and-spending law signed by President Donald Trump in July mandates a vast expansion of Medicaid work requirements to most states.<\/p>\n These systems will lead to 5.3 million more people being uninsured in 2034, according to an estimate<\/a> from the Congressional Budget Office.<\/p>\n The law applies to 40 states and Washington, D.C., because they expanded Medicaid in recent years to cover more working-age adults.<\/p>\n About 18 million people will be affected once the work mandate is fully implemented nationally, according to the CBO. Unless their state gets an exemption till 2028, by 2027, these enrollees will need to prove they\u2019re working, volunteering, getting job training, or doing other qualifying activities at least 80 hours a month to keep their coverage.<\/p>\n Republicans say this is a commonsense way to weed out \u201cfreeloaders<\/a>.\u201d Democrats argue that\u2019s just political cover for slashing a program that saved some 27,000 lives<\/a> starting in 2010, when the Affordable Care Act was signed, through 2022.<\/p>\n The number of people who lose coverage, either temporarily or permanently, could vary widely by state, depending on how each state implements and maintains its reporting system.<\/p>\n Michigan\u2019s experience illustrates how challenging it can be to stop large numbers of people from inadvertently losing coverage, even when leaders try their best to prevent that.<\/p>\n \u201cWe were very committed to implementing a law that we didn\u2019t agree with, in a way that reduced the number of people who lost insurance just because the government screwed something up,\u201d Gordon said.<\/p>\n A Year of High-Stakes Work<\/strong><\/p>\n In 2013, then-Gov. Rick Snyder, a Republican, waged a fierce battle within his own party to expand Michigan\u2019s Medicaid program.<\/p>\n To Snyder, it was an opportunity to simultaneously save money and expand access<\/a>: By slashing the rate of uninsured Michiganders by almost half, the state could reduce the burden of uncompensated care on the health system and boost the economy by improving the physical health of the workforce.<\/p>\n But opponents saw it as an expansion of \u201cObamacare\u201d<\/a> that would shift massive new costs<\/a> onto state and federal taxpayers. A work requirement became a point of compromise and a way for Snyder to mollify some of that opposition.<\/p>\n From a coverage perspective, Michigan\u2019s expansion of Medicaid was a success. Low-income adults signed up, ballooning new enrollment beyond what even supporters had initially estimated.<\/p>\n By 2019, there were nearly 700,000 new Medicaid recipients in Michigan, and the state was responsible for an increasing share of their health care costs. (Medicaid is paid for jointly by states and the federal government.)<\/p>\n Fiscal hawks were worried. \u201cIt\u2019s now become the largest budget problem in Michigan,\u201d said Jarrett Skorup<\/a> of the Mackinac Center for Public Policy<\/a>, a free-market think tank<\/p>\n Snyder signed the bill creating the 80-hour-a-month work requirement in 2018, but it wouldn\u2019t go into effect until 2020, after he left office.<\/p>\n That left newly elected Democratic governor Whitmer\u2019s administration holding the bag. She tapped Gordon, who\u2019d held senior roles in the federal Office of Management and Budget and Department of Education during the Obama administration, to lead the sprawling state health department.<\/p>\n Gordon was terrified that Michigan would become another Arkansas, which was the first state to implement a work requirement<\/a>, in 2018. The change led more than 18,000<\/a> Arkansas residents to lose<\/a> their coverage.<\/p>\n People in Arkansas were disenrolled \u201cbecause computers went down, because forms weren\u2019t clear, because they just never heard about it,\u201d Gordon said. \u201cMaybe they got sicker, maybe they died because of this decision.\u201d<\/p>\n If Michiganders lost coverage at the same rate as Arkansans, as many as 160,000 people would have lost their health insurance within a year, according to one estimate<\/a>.<\/p>\n Trying To Make Medicaid Work Requirements \u2026 Work<\/strong><\/p>\n In some ways, Michigan was better positioned than other states to implement a work requirement, Gordon said: The unemployment rate was the lowest it had been in two decades and the state was already pretty good at collecting and tracking employment and wage data.<\/p>\n \u201cIf the state can figure out on its own, without having to ask you if you\u2019re working, that\u2019s great, because then you don\u2019t have to do anything,\u201d Gordon said. \u201cYou\u2019re just exempted.\u201d<\/p>\n Michigan eventually changed its law to allow people more time to report their work activities and to automatically determine their compliance or exemption by cross-checking data from other assistance programs, like food benefits.<\/p>\n To see if recipients were students or had health-related exemptions, Gordon and his team also tried to capture data from community college enrollment and medical insurance claims.<\/p>\n Dozens of staffers reprogrammed the state\u2019s outdated benefits enrollment portal, created full-time call centers, set up audit and appeals processes, hired compliance review teams, and trained hundreds of local organizers to provide tech and enrollment assistance.<\/p>\n Forms and letters alerting hundreds of thousands of enrollees to the new policy were redesigned to be attention-grabbing and easier<\/a> to understand.<\/p>\n The sheer amount of effort and time required meant other public health efforts had to take a back seat, Gordon said. \u201cYour first job is going to suffer, and that is a consequence of work requirements.\u201d<\/p>\n In Michigan, Black infant mortality rates were some of the highest in the nation<\/a>. Thousands of people were still dying from overdoses<\/a>.<\/p>\n Yet at the state health department, \u201call of the oxygen in the room was dedicated \u2014 almost all, I should say \u2014 to the work requirement implementation,\u201d said Renuka Tipirneni<\/a>, an internal medicine physician at the University of Michigan who studies Michigan\u2019s Medicaid expansion.<\/p>\n Even after all that work, Gordon and his team had no illusions the system they\u2019d spent $30 million creating was flawless.<\/p>\n \u201cThere was a real sense that everyone was doing everything they could,\u201d he said. But they still worried that \u201chuge numbers of people were going to fall through the cracks. Because that\u2019s just what happens with systems like this.\u201d<\/p>\n A \u201cWaste\u201d of $30 Million<\/strong><\/p>\n By the time the work requirement went into effect on Jan. 1, 2020, the state had been able to determine that the vast majority of the nearly 700,000 Medicaid expansion recipients already met the work requirement or were exempt.<\/p>\n That left about 100,000 people whose status was unknown and who therefore still had to go through the reporting process. By March, around 80,000 of those had failed to report and were on track to lose coverage.<\/p>\n On the one hand, it was a lower rate of coverage loss than Arkansas had. But it was still \u201can enormous number of people\u201d set to lose coverage, Gordon said.<\/p>\n Before that could happen, a federal judge issued a ruling<\/a> on March 4, 2020, blocking Michigan\u2019s policies from going forward. That same day, Gordon was scheduled to testify<\/a> before a Republican-led subcommittee about how the rollout was going.<\/p>\n Instead, he found himself explaining to legislators that the state\u2019s work requirement was essentially dead in the water, and that \u201cwe had, on the demand of the people holding the hearing, spent tens of millions of dollars for no purpose.\u201d<\/p>\n Given how brief Michigan\u2019s experiment with a Medicaid work requirement was \u2014 only about two months of the policy\u2019s being in effect, with no one losing coverage in the end \u2014 the Mackinac Center\u2019s Skorup doesn\u2019t see a lot of takeaways about the real-life impacts of work requirements.<\/p>\n \u201cIf you have an administration that is not sold on these being necessary at all, then I think they\u2019re more likely to drag their feet on implementing this, which is what I think they did,\u201d Skorup said, referring to the Whitmer administration.<\/p>\n Skorup is concerned because Medicaid costs keep rising<\/a>, with 2.6 million Michiganders<\/a> (1 in 4 residents) now covered by the program or the related Children\u2019s Health Insurance Program. Skorup believes Medicaid spending is \u201ccrowding out\u201d teacher pay, pensions, and roads in the state budget.<\/p>\n Supporters of Medicaid expansion say the program\u2019s growth has benefited Michigan, pointing to research that Medicaid expansion helped boost employment and school enrollment<\/a> and was a net positive<\/a> for the state financially.<\/p>\n Court Ruling Comes Days Before Covid Hits<\/strong><\/p>\n Only days after the court ruling stopped the work requirement in Michigan, officials announced the state\u2019s first cases of covid-19<\/a>. The 80,000 Michiganders who might have lost Medicaid were spared, so their health coverage continued as the pandemic unfolded. Gordon continued as health director until 2021, when he resigned<\/a> over \u201cdifferences of opinion\u201d with Whitmer about some pandemic restrictions<\/a>.<\/p>\n These days, Gordon is experiencing a sense of d\u00e9j\u00e0 vu, with new predictions showing as many as 500,000 Michiganders<\/a> could lose coverage within the first year of federally mandated work requirements, according to state estimates.<\/p>\n \u201cWe would have a more honest and more efficient policy if Republicans just kick people off Medicaid,\u201d he said.<\/p>\n That would be \u201cincredibly harmful,\u201d he said. \u201cBut this thing they\u2019re doing isn\u2019t any less harmful. It\u2019s just more wasteful administratively, and more confusing to everyone.\u201d<\/p>\n This article is from a partnership that includes Michigan Public<\/a>, NPR<\/a>, and KFF Health News.<\/em><\/p>\n KFF Health News<\/a> is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF\u2014an independent source of health policy research, polling, and journalism. Learn more about KFF<\/a>.<\/p>\nUSE OUR CONTENT<\/h3>\n