Natural State News

Arkansas is proposing a new "work incentive" component for the Arkansas Works Medicaid program for those on a low income in an effort to satisfy both federal guidelines and the courts.

 Arkansas Works previously had work requirements for recipients and the state has declined to request a continuation of those requirements with it applies for federal approval to renew the program, according to Magnolia Reporter.

In recent weeks the Biden administration has moved to head off any attempt by states, including Arkansas, to return immediately to the widespread use of work requirements that were allowed through special waivers introduced under the Trump administration.

The Centers for Medicare and Medicaid Services (CMS) sent letters to the states telling them it had started the process to decide whether to withdraw approval of the waivers.

The agency also sent separate letters to states, including one to Arkansas, which rescinded the move by former CMS Administrator Seema Verma in January, who told them they could keep work requirements for nine months after being barred by the Biden administration.

Gov. Asa Hutchinson and fellow Republican lawmakers are proposing a hybrid program that they argue will encourage people to work, but will not deny coverage to anyone. Legislation is proposed that will use Medicaid funds to place recipients on private health insurance, but allow those who do not work or go to school to remain on traditional Medicaid.

"No one loses health care benefits, but there are incentives to encourage that kind of behavior and that kind of progress in life," Hutchinson said at a news conference at the Capitol.

In a letter to the state, CMS acting administrator Elizabeth Richter said the agency "needs to remain able to exercise its authority under the act and implementing regulations to maintain continued oversight of demonstrations in order to ensure that they remain likely to achieve the statutory purposes."

The CMS will provide states with a written notice and an opportunity to request a hearing before determining whether to suspend, modify or withdraw the waiver. 

Arkansas was one of the first to introduce work requirements for most Medicaid recipients and has appealed to the U.S. Supreme Court after its program was blocked by a lower court.

In March 2019, a federal district court vacated the Department of Health and Human Services’ (HHS) approval of Arkansas’ work requirement policy. This was upheld by an appeals court.

The courts found that more than 18,000 people, or one in four subject to work requirements, lost coverage during the seven months the policy was in place.