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Bipartisan plan eases Medicaid work reporting requirements

Jonathan Oosting
The Detroit News
Senate Majority Leader Mike Shirkey, R-Clarklake.

Lansing — Top Senate officials are teaming up on a plan that would ease compliance reporting rules for Medicaid recipients who will be required to work at least 80 hours per month or risk losing health care coverage under a controversial new Michigan law.

A bipartisan proposal from Senate Majority Leader Mike Shirkey, R-Clarklake, and Sen. Curtis Hertel, D-East Lansing, would simplify monthly reporting rules for able-bodied Healthy Michigan enrollees who must verify their monthly work hours beginning next year.

The package could prevent tens of thousands of working residents who are complying with the “spirit of the law” from being “wrongfully kicked out of the system” because they fail to comply with the reporting rules, Hertel said Thursday in testimony before the Senate Health Policy and Human Services Committee.

Hertel’s legislation would extend the monthly reporting deadline, moving it from the 10th day of the following month to the last day of the following month. It would also provide a mechanism for residents to prove monthly compliance at a later date if they miss the deadline.

A separate bill sponsored by Shirkey, who pushed the initial work requirement law last year, would provide a reporting exemption for Medicaid recipients if the state can verify their work hours in other ways, such as income disclosure required for welfare programs.

Shirkey said lawmakers studied Medicaid work requirement laws implemented in other states that had “very cumbersome processes” for people to verify compliance.

The new proposal will “make sure we don’t get into the same pickle that other states had been in terms of people just falling off the edge because of some ridiculous compliance requirement,” he told reporters earlier this week.

Democratic Gov. Gretchen Whitmer opposed the Medicaid work requirement law signed last year by her Republican predecessor, suggesting it could result in between 61,000 and 183,000 residents losing coverage after the new rules take effect.

State Sen. Curtis Hertel

Whitmer told The Detroit News in February that she wanted to ease reporting rules and suggested the state should exempt Medicaid recipients over the age of 50 from the work requirements. Her Department of Health and Human Services supports the new legislation.

While Shirkey co-sponsored the new plan to simplify reporting rules, the Republican leader made clear earlier this week that the proposal is “as far as we’re going to go now.”

The new work rules could apply to roughly 540,000 able-bodied adults, according to 2018 projections from the nonpartisan House Fiscal Agency, which predicted about 5 to 10 percent of Medicaid recipients will drop out or leave the program as a result.

It’s unclear how those projections might change under the proposal to revise monthly reporting rules. The state could potentially save money if fewer people are required to report compliance by phone, resulting in reduced staff needs at a state call center.

“The number of non-compliant individuals under the original legislation is, at this point, impossible to estimate due to the lack of experience in Michigan or in other states,” according to an analysis by the non-partisan Senate Fiscal Agency.

GOP President Donald Trump’s administration opened the door to Medicaid work requirements for the first time in 2017 and invited states to submit waiver requests.

Work requirements adopted by other states have prompted legal challenges from critics who contend the rules inappropriately bend a program designed to provide medical coverage to low-income residents.

Federal judges have blocked Medicaid work laws in Kentucky and Arkansas, where more than 18,000 enrollees lost health coverage in 2018 after failing to meet work or reporting requirements.

The Michigan law applies only to Medicaid enrollees in the Healthy Michigan program, created under a 2013 law championed by GOP former Gov. Rick Snyder that expanded eligibility to low-income adults who earn up to 133% of the federal poverty level.

Beginning in January of 2020, able-bodied Healthy Michigan beneficiaries will be required to work at least 80 hours per month in a paid job, job training program, volunteer position, internship or undergo substance abuse treatment.

Residents subject to the rules will be allowed two months of “non-compliance” in any 12-month period. After their third month without proving work, they will lose coverage for at least one month until they can again prove compliance.

In testimony Thursday, Shirkey said Republican legislators initially agreed to expand Medicaid eligibility under the Affordable Care Act with the goal of “mitigating health related obstacles… to personal productivity.”

Work requirements will help the state achieve that goal, he said, and easing reporting rules will “mitigate the kind of things that are unintentionally causing people problems in terms of staying enrolled.”

Gilda Jacobs, president of the Michigan League for Public Policy, criticized the work requirement law and recommended additional exemptions, including for parents and other caretakers who may stay home or work less to take care of children.

But the Democratic former state senator called the new reporting flexibility bills “a step in the right direction to mitigate the harms of the work requirements” and urged their passage.

The Senate panel did not vote on the bills Thursday, but Hertel advocated for quick action in case the state is required to seek federal approval for the reporting rule changes before the law kicks in next year.