While some policy analysts say the federal government's decision to reject Georgia's work requirement and premium proposal for its partial Medicaid expansion plan kills a good incentive, others say it highlights the need for a full expansion.
The U.S. Centers for Medicare & Medicaid Services (CMS) said it rejected the provisions based on the Biden-Harris administration's efforts to reduce health disparities.
CMS said the plan counteracts the goal of the program, especially amid greater health risks and economic interruptions during the COVID-19 pandemic.
"CMS believes that the COVID-19 pandemic and its expected aftermath have made the state's work requirement infeasible," the federal agency wrote in a Dec. 23 letter to the state. "In addition, implementation of the work requirement to suspend coverage or disenroll beneficiaries who become eligible under the demonstration during the public health emergency for COVID-19 would currently not be in compliance with the Families First Coronavirus Response Act (FFCRA) temporary increase in federal Medicaid funding, which is conditioned on the state's maintenance of certain existing Medicaid parameters."
Georgia Budget Policy Institute (GBPI) said more than 230,000 additional Georgians would be eligible for the state- and federal-funded program without the work requirement, but it would cost the state more than a full expansion.
The federal government gives states the option to raise the income eligibility requirement for Medicaid to open the program to more participants. States can choose to do a full expansion of the program and raise the income limit to 138% of the federal poverty level – or $17,000 for an individual. The state's partial expansion, Georgia Pathways, would extend the Medicaid income eligibility to a maximum of 100% of the federal poverty line – or a little more than $12,000 annually. The Trump administration had approved Georgia's plan in October 2020.
Under Pathways, Georgians would have to complete a minimum of 80 hours of work per month or other activities, such as training or education, to qualify for the program. It was supposed to start July 1. CMS has warned it had concerns about the work requirement since February and placed Georgia's implementation of the plan on standby until Georgia could explain why the requirements should stay in place.
CMS also said the requirement for certain Medicaid recipients to pay premiums also goes against the objectives of Medicaid. The agency said the premiums could create barriers to coverage and could lead to "shorter enrollment spells" and "lower enrollment rates."
Kemp's office told reporters the state would fight the federal agency's decision in court.
Georgia Democrats continuously have pushed for a full expansion of the Medicaid program, arguing it extends more health care coverage to Georgians and costs the state less.
GBPI analysts said the waiver would cost the state $650 million in the first year, surpassing the $336 million it would cost for two years for full Medicaid expansion.
"The federal government's rejection of a work reporting requirement blocks what would have been an unnecessary obstacle to obtaining health care coverage for both employed and unemployed Georgians, but the cost of the program will now skyrocket," GBPI Director of Strategic Communications Caitlin Highland said in a statement.
"Full Medicaid expansion is both the morally right and fiscally responsible choice to help Georgians access care while drawing down $1.9 billion in federal funding to cover Medicaid expansion costs as well as other state priorities such as education, rural broadband and workforce development," Highland said.
Georgia Public Policy Foundation CEO and President Kyle Wingfield said the program under the waiver already was limited because of budget caps. Wingfield said he believed the work requirement would have been a "good incentive" to increase employment in Georgia, which already has seen pre-pandemic level recovery. The state's unemployment rate was 2.8% in November, which is lower than before the pandemic.
Wingfield said CMS' decision is based on a "temporary condition."
"We're not talking about a year, a year and a half ago when unemployment was very high," he said.