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Obamacare repeal adds 'work requirements.' Here's why that's controversial.

·Senior Writer
Paul Ryan AHCA bill obamacare repeal
In an attempt to pass the Obamacare repeal bill, Speaker Paul Ryan added a provision that allows states to impose work requirements from Medicaid. Source: Getty

The Obamacare repeal bill, the American Health Care Act, has undergone a few changes since it left committee last week. One of those changes affects Medicaid by letting states put in place work requirements to get into the program, which provides health care for low-income people.

If a state does decide to impose a work-requirement for Medicaid, that will mean that a working-age adult would need to have a job to be eligible. It’s a controversial policy because many working-age adults aren’t capable of having a job or can’t find one.

“The amendment seeks to keep more healthy adults in the workforce and off Medicaid, but no evidence supports this policy’s effectiveness,” writes Anuj Gangopadhyaya of the Health Policy Center at the Urban Institute.

The Obama administration largely denied requests for waivers to allow states to enact work requirements, but a recent letter by HHS Secretary Tom Price indicated the Trump administration would be amenable to giving waivers. And with the work requirement provision in the AHCA, states would not have to ask for one should the legislation pass. A vote was expected Thursday night but was delayed because of a lack of support for the bill.

Why did some Republican lawmakers push hard for a work requirement? It may not simply be about cutting spending. According to the Urban Institute, some may be pushing for a work requirement because of a 2014 report by the Congressional Budget Office that predicted that adults would work less under the ACA, or Obamacare. The thinking was that people might work less because they’d have access to health care without having to have a job.

However, with actual Obamacare experience, projections aren’t needed—there’s actual data.

Medicaid expansion under the ACA increased coverage and treatment for millions of low-income children and adults without affecting the labor market. “Trends in employment status, number of hours worked per week, full-time work status, wages, and job switching were no different across Medicaid expansion and non-expansion states following implementation,” writes Gangopadhyaya. “Moreover, a recent Urban Institute study found no association between the major provisions in the ACA and employment status or hours worked per week.” Further analysis by the Urban Institute even found older adults who had been working merely for health insurance benefits did not simply retire when eligible for Medicaid under the expansion.

The Urban Institute notes the work requirement wouldn’t affect current beneficiaries. However, it could throw a wrench into the plans of caretakers, the disabled, and other Americans who have other responsibilities or impediments that keep them from working.

Laziness is not the main reason people aren’t working. According to the conservative think tank American Enterprise Institute, “The reasons poor, working-age people cite for not working primarily fall into two categories.” In a report from 2016, it noted “non-workers (overwhelmingly female) with children tend to cite family and home responsibilities, and those without children disproportionately cite disability and illness.”

Other studies concur with the Urban Institute. The Center for Budget and Policy Priorities notes that the evidence does not support work requirements, and a Kaiser Family Foundation survey found that most Medicaid enrollees who weren’t working said they had impediments to work. KFF also found that 59% of adult recipients are employed, and that 51% are employed full-time for the entire year.

The Congressional Budget Office analysis of the AHCA found the uninsured population would skyrocket by 14 million in 2018—and 24 million by the end of the decade. The Urban Institute says the work requirements would bump that number even higher.

Ethan Wolff-Mann is a writer at Yahoo Finance focusing on consumer issues, tech, and personal finance. Follow him on Twitter @ewolffmann. Got a tip? Send it to tips@yahoo-inc.com.

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