An Estimated 136,000 Kentuckians Could Lose Medicaid Coverage

Jan 10, 2019

Between 86,000 and 136,000 Kentuckians could lose their Medicaid health insurance after the state rolls out changes to the program in April, according to an updated analysis from The George Washington University.

Leighton Ku, a professor of health policy and management at GW, said the new estimate is based on data from Arkansas, where officials there have already implemented similar community engagement requirements.

In December, Arkansas officials reported around 17,000 people had lost their Medicaid coverage in the first six months after the implementation of a new 80-hour a month work/volunteer/training requirement. 

The analysis predicts a greater number of people in Kentucky could lose coverage because the state’s community engagement requirement is a bit more strict than Arkansas’. In Kentucky, the changes apply to 18- to 64-year-olds, while Arkansas’ requirement applies to 18- to 49-year-olds. Kentucky will give people two months to report their hours, while Arkansas gives people three months.

In 2016, Kentucky officials estimated that 95,000 Kentuckians over five years would no longer have Medicaid coverage as a result of the changes. But the GW analysis estimates that the losses in Kentucky will happen within the first year of implementation.

“It will happen quickly, because the experience that has been seen in every other work requirement program is that there are very steep drop-offs in enrollment right away,” Ku said.

There are over 300,000 Kentuckians who will have to meet new community engagement requirements once changes take effect in April. GW estimates that between 26 and 41 percent of the people who have to comply with the law will lose coverage.

Amid worries from advocates about people losing Medicaid coverage because of new work or volunteer requirements, Kentucky officials have argued that some of those people are likely to gain private insurance through an employer or purchase coverage on Healthcare.gov.

But Ku points to research that shows that the majority of the low-income adults in Kentucky who are able to work either already have jobs or will obtain low-wage jobs that don’t offer health insurance. In addition, he said if kicked-off enrollees maintain the same level of income, they won’t qualify for a subsidy that would help pay for a Healthcare.gov policy. That’s because in

Kentucky, there’s an income threshold in order to get a subsidy.

“The problem is that the income levels that many of the people who are on Medicaid [are] basically too low to qualify for the insurance subsidies that come along with the exchange,” Ku said. “They will still in a way, technically be eligible for Medicaid, because their incomes are below 138 percent of poverty limit.”

In a separate report from the left-leaning Center on Budget and Policy Priorities released Thursday, author Judith Solomon said that the community engagement requirement isn’t effective in getting people into work.

“Work requirements are ineffective in promoting employment because they don’t accurately identify those who can work but aren’t working — often for reasons beyond their control — nor do they assess their needs or provide them with supports,” Solomon wrote.

Kentucky has said it’s working with regional career centers to help people get job training and find work so they can keep Medicaid coverage. Ku, however, said those job training programs cost a lot of money – money that the state is self-funding since the federal Medicaid program will not reimburse any of that cost.

“Understanding that you actually do have to show up at work on time, [that] you’re not supposed to get upset just because a customer doesn’t treat you very well — things you need to stay at the job — those sorts of trainings cost thousands of dollars,” Ku said. “And that appears to be something that, however well-intentioned the state may be, I don’t think that they’re trying to provide those level of resources.”

The community engagement requirements apply to so-called able-bodied Medicaid enrollees between 18 and 64 years old. Pregnant women, children, people with both Medicaid and Medicare coverage, people who have Medicaid because of a disability and the primary caregiver of a household with children, are all exempt from the requirement.

Other changes to Kentucky’s Medicaid program include the loss of automatic dental and vision coverage – that type of insurance will only be accessible through earning dollars in a “MyRewards” account.

After federal approval last year and then a court ruling that stalled the implementation, Kentucky’s Medicaid changes are slated to roll out one region at a time beginning in April. However, another court challenge to the re-approval of the changes is expected in coming weeks.