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More than 4,300 Arkansas residents lose Medicaid under work requirements

Arkansas Gov. Asa Hutchinson, center, talks Wednesday about the more than 4,300 residents who just lost Medicaid coverage because of the state's new work requirement.
Arkansas Gov. Asa Hutchinson, center, talks Wednesday about the more than 4,300 residents who just lost Medicaid coverage because of the state's new work requirement. (Andrew Demillo/AP)
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Several thousand poor residents of Arkansas have been dropped from Medicaid because they failed to meet new requirements, the first Americans to lose the safety-net health insurance under rules compelling recipients to work or prepare for a job to keep their coverage.

Gov. Asa Hutchinson (R) announced Wednesday that 4,353 people have become ineligible for Medicaid, out of an initial group of nearly 26,000 who became subject to the requirements this spring.

“I don’t like that number,” Hutchinson said of the residents who were removed. But, noting that 1,000 people in the overall program have found employment, he called the requirement “a proper balance of those values that we hold important,” including work and personal responsibility.

His state is the earliest proving ground for a polarizing idea, long advocated by conservatives but rebuffed by the federal government until this year, that Medicaid should follow welfare cash benefits and food stamps in requiring people to perform work or other kind of “community engagement” to keep their benefits.

Under Arkansas Works, the state’s expansion of Medicaid under the Affordable Care Act, able-bodied adults must go online every month and report their hours of work or other community engagement. They lose insurance if they fail to comply for three months in a year.

The requirements began in June for the initial group, who are ages 30 to 49. August was their third month, so the number announced Wednesday represents the first beneficiaries to be dropped. They cannot reapply until next year.

The concrete reality of more than 4,300 individuals losing insurance — diminishing their access to care — is alarming leaders at medical and mental health clinics and hospitals, as well as legal advocates for the poor. They say logistics of the work rules are ill-suited to the lives of many poor Arkansans, who may not have computer access to report their hours online or may not have even received — or understood — letters the state sent telling them how to stay on Medicaid.

Statewide, nearly a fourth of the population lives in areas in which Internet service is not available, according to figures from the Federal Communications Commission. Even when they have cellphones, many low-income people have plans in which they pay by the minute, said LaShannon Spencer, chief executive of the Community Health Centers of Arkansas. “So spending your minutes to report [work hours] — what’s the likelihood?” Spencer asked.

In Lee County in the Mississippi Delta, where poverty is rampant, nearly three-quarters of the people lack online access. “I’ve had people say, ‘What’s Arkansas Works?’ and I’m thinking, ‘Oh my gosh, you don’t even know what it is, so how do you know that you need to go online and report work?’ ” said Kellee Farris, who runs the Lee County Cooperative Clinic.

Even the clinic has difficulty reaching its patients by mail because many move often among relatives and friends, Farris said. At a community meeting last month on the new rules, where officials and nonprofits’ representatives greatly outnumbered people on Medicaid, Farris said she told a staffer from the state Department of Human Services that a letter wasn’t enough to ensure beneficiaries know what the program now expects of them.

A report released Wednesday with Hutchinson’s announcement shows that, in their initial month of June, the first group of 25,815 people included nearly 18,000 granted immediate exemptions because they worked at least 80 hours per month, were raising children, had a medical frailty, or for other reasons.

Of the rest, just under 450 reported the required number of “community engagement” hours, while nearly 7,500 did not.

Kevin De Liban, an attorney for Legal Aid of Arkansas, said that with more than 90 percent of the people on Arkansas Works already employed or qualifying for an exemption, those losing eligibility are being hurt primarily because of “administrative hoops that trip people up.”

Cindy Gillespie, the state’s human services director, said at the news conference that people can call a phone line for help.

Trump administration officials and other Republicans contend work requirements foster individual responsibility that eventually can lift people out of poverty. Critics contend they will force low-income people out of the insurance they need to improve their lives.

Federal health-care officials have approved work requirements in three more states and have received proposals from 11 others. Arkansas is the only place with rules in effect.

After the administration announced in January that it was receptive to work requirements, Kentucky became the first state to gain federal permission. Its requirements were to have been phased in starting in June. But just before that, a federal judge blocked them, ruling that the U.S. Department of Health and Human Services had not adequately considered whether the change would help or hinder Medicaid’s central purpose of providing health coverage.

A similar federal lawsuit was filed last month over the Arkansas plan, but the program had already begun and is going forward.

Work requirements are scheduled to begin in early January in Indiana and New Hampshire, the other states with federal permission.

Of the 33 states, plus the District of Columbia, that have expanded Medicaid under the ACA, Arkansas became the first in which the state is using federal money to buy private health plans for people in the expansion group — those with incomes up to 138 percent of the federal poverty level.

For that reason, clinics and hospitals cannot tell easily what fraction of their Medicaid patients are in Arkansas Works and at risk of losing coverage under the requirements.

Danny Stanley, who runs the Southwest Arkansas Counseling and Mental Health Center in Texarkana, said that at least 10 of the clinic’s patients have lost coverage. “We will continue to see these people,” he said, “but they will go on a sliding-fee scale and their services will be scaled back. We have to make ends meet.”

Correction: An earlier version of this story incorrectly said Arkansas residents lose Medicaid coverage if they don’t comply with state work requirements for three consecutive months. The period is three months in a plan year.

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