Guy Gordon (00:00.59)
Hello, once again, and welcome to another edition of the Facts Matter Podcast from the Citizens Research Council of Michigan. I’m Guy Gordon, this podcast dedicated to the notion that rather than politics driving policy, perhaps facts should. And today the facts we’re going to be taking a look at are the consequences of Medicaid work requirements that will be hitting the state of Michigan quite soon. This affects one in four people in the state of Michigan, about two and a half million people.

And it will basically, with the w work requirements that were promoted under the One Big Beautiful Bill Act, at the time it was said that this was to address waste, fraud, and abuse. opponents of it, and even some Republicans have acknowledged it was really to generate savings to pay for tax cuts under the One Big Beautiful Bill, which were due to expire. Whatever the rhetorical arguments are around it, it’s coming. And the consequences could have a far-reaching impact.

not just on Medicaid recipients. Joining us, Karley Abramson, associate researcher for healthcare policy at the Citizens Research Council of Michigan. Karley hello.

Karley Abramson (01:08.458)
Hi, thanks for having me.

Guy Gordon (01:10.222)
So let’s establish first of all for just the the universe of people that should care about this. This doesn’t just affect Medicaid recipients. The consequences and the downstream impact could be much more than.

Karley Abramson (01:22.998)
Exactly. This is and it’s one of the reasons that it’s something that CRC is discussing because it is in the state’s interest to make sure that as many people as possible stay on Medicaid, especially the ones who are only falling off simply because of the administrative burden or the paperwork requirement or just any kind of like minor a errors that might lead them to be kicked off Medicaid. It is in the state’s interest for a variety of reasons.

One, because of the way the Medicaid program works in terms of how much federal money the state gets, it’s a 90-10 split. And so Michigan receives a lot of federal money every every $10 Michigan spends, we get 90 from the federal government. And so it is in the state’s interests financially to want to keep people in the program. In addition, when people are when people don’t have health insurance, the

the people who end up paying that and the the way that burden kind of shifts across everybody is something that not a lot of people necessarily know or think about when they’re thinking about a different group of people who is separate from them not having insurance, right? And so what they what happens is these ripple effects of someone not being on insurance means that inevitably they might need care. And when they do need care because they haven’t been getting access to preventative care without insurance.

Guy Gordon (02:31.787)
Right.

Guy Gordon (02:46.721)
Right.

Karley Abramson (02:47.972)
They end up potentially sicker going to the ER to get more expensive care. Hospitals then have to cover those costs. hospitals that are already operating under very tight margins are at financial risk of closing. That cuts off access to people in certain areas. You know, in Michigan, we have a lot of rural areas that don’t have a lot of hospitals around, or it takes an hour or two hours to get to a hospital. If a hospital near them closes, that’s a that’s a big deal.

so there’s all these ripple effects. And then as, you know, we the way insurance pools work, we want healthy people included because the risk ensures, you know, distribute risk evenly, right? And so everyone’s premiums potentially could be at risk of going up when we have more when we have fewer healthy people and more sick people on Medicaid or on insurance that makes everything more expensive.

And so there’s lots of different ways that these ripple effects affect both individuals in the state and the state’s financial well being as a whole.

Guy Gordon (03:52.546)
Well, we heard a lot of complaints in in the in most recently in in past years of huge weights in waiting rooms and the inconvenience of all of that for people that are covered or under Medicare. that will only get worse if a number of people are are knocked off the rolls. And it’s really kind of hard to wrap your your arms around how many might be lost, but the Congressional Budget Office have said work requirements alone could result in five point three million people.

no longer be cover being covered over the next ten years. That’s how many might drop off. And that’s obviously a nationwide number.

Karley Abramson (04:26.732)
Right. Yeah. Yeah. There’s yeah, there’s it’s hard to know exactly. and there’s two kind of different buckets of people who are going to lose coverage. There’s there’s going to be a group of people who just simply no longer meet those eligibility requirements. yeah.

Guy Gordon (04:40.929)
Well let’s break down what those requirements are. Let’s let’s start with the with the with the basics here. First of all, what is the work requirement under the OBB that will be, I guess, taking effect in in January here in Michigan, correct?

Karley Abramson (04:49.732)
Mm-hmm.

Karley Abramson (04:53.248)
Mm. Yeah, so it’s states have a states can I think they can request an extension from the federal government if they need to, but we don’t really know how that’s going to work just yet. But yes, it’s you know.

Guy Gordon (05:00.621)
Okay. But it it means we have less than six months to prepare for this. And the work requirement basically says you must prove that you are working or meet a number of different qualifications for a waiver.

Karley Abramson (05:17.082)
Correct. So essentially two things are kind of happening. There’s this more frequent redeterminations. And so previously this redetermination would happen once a year to assess whether or not you are eligible for the the program. And so previously for this Medicaid expansion population, it was, you know, whether they have are within that 133% of the federal poverty l line to be able to be eligible.

They are now adding a work requirement to this. So they are increasing the frequency of the redetermination and now adding another eligibility factor being these work requirements. And the work requirements essentially say that you have to show with documentation that you are either working this number of hours or in a job training program, in school, doing community service. Yeah. I think it’s 80. Hold on. Let me.

Guy Gordon (06:05.837)
I believe it’s twenty hours a week, correct?

Guy Gordon (06:12.459)
Yeah, eighty eighty a month.

Karley Abramson (06:13.348)
Yeah. Yeah. Right. Yes. There’s let me I just want to make sure I have the number right.

Guy Gordon (06:16.63)
Yeah.

Karley Abramson (06:23.426)
Yes. They will have spent at least, yes, eighty hours a month in doing one of you know, one or more of these activities. So they need to demonstrate that there are some potential exemptions that you but also those will all require paperwork and documentation to show. So you have to do that.

Guy Gordon (06:41.099)
And it’s going to require paperwork on the part of employers. It may, if they’re doing community service, require doing the paperwork on the part of nonprofits who have to help them document this. There’s a burden on them as well. And so there is a vested interest in in the state making sure that those communities are prepared for this, correct?

Karley Abramson (07:01.412)
Correct. And there are certain ways there’s, you know, certain ways that the state can use some kind of automatic process for any existing data that it has that might help this renewal process go faster. it, you know, it can capitalize on that and try to increase those number of automatic renewals so that people don’t have to kind of go through this process, but that requires infrastructure and personnel and resources.

Guy Gordon (07:21.441)
Mm-hmm.

Karley Abramson (07:28.82)
and since this is all increasing in frequency and in the number of paperwork, that’s where we come in to say this really is a time where we want Michigan to invest upfront in making sure that this process goes as smoothly as possible.

Guy Gordon (07:42.508)
Right. So what are some of the what what are some of the waivers here? I know if if you are pregnant, if you’re going through job training and can can prove that you’re you’re doing some skills enhancement, those can count towards waiving the eligibility requirement. Also if you are currently battling an illness and th that would make it impossible for you to work. The interesting part is though, for instance, if

Karley Abramson (07:52.356)
Yeah.

Karley Abramson (08:04.154)
Correct.

Guy Gordon (08:09.899)
If you’re getting cancer treatment or you’re getting chemo, which is debilitating and would not allow you to work, you’re exempt. But if you were getting radiation where you could still return to work after your treatment, you’re not.

Karley Abramson (08:22.436)
Well yeah, it will and that that’s why the definition of medically frail is important. and you know, there’s it’s federally defined as well. And so you that that medically frail category is one of those exemptions, but how easy or difficult it is to show medically frail to be able to be exempt out of the work requirement is still a little bit unclear. the other categories, if you’ve you know, if you’re in a substance abuse program, if you’ve been you

Guy Gordon (08:28.748)
Right.

Karley Abramson (08:52.086)
If you were recently incarcerated, there, you know, postpartum, there’s a there’s a few different, you know, categories of people. And then there’s also potentially, if you are in a county that has particularly high unemployment, that you can potentially that county could potentially be exempted. but I think that the way they are calculating that is it’s about, I think, eight percent of the national, or like if they’re over eight percent of the national average. And so it’s unclear how many counties.

Guy Gordon (09:07.191)
Right.

Guy Gordon (09:17.878)
Yeah. And I actually crunched the numbers on that. There there are eight counties in Michigan that would cu currently be exempt. But most of the U most of the UP and then a a few here in the Minton.

Karley Abramson (09:25.474)
Okay. Right.

Yeah. And so it’s it’s unclear h it you know, how many people I don’t think they’re in the mo the most, you know, highly populous, you know po populated it. I don’t know how much of a huge impact would that would make, but that is potentially one of the the exemptions.

Guy Gordon (09:39.158)
Right.

Guy Gordon (09:46.202)
so th there are two issues here first, and number one is just awareness, whether or not the affected population is aware that this is coming down and what they need to do. is there a st should there be a state role or some kind of a you know, a public public relations campaign to inform people about this? And who will have that responsibility?

Karley Abramson (10:07.523)
Yes.

Yeah, so and it the state is responsible for educating, you know, in the six months leading up to to be able to educate and try to inform people about what changes are coming so that people can not only prepare to do the paperwork, but any necessary changes they might need to make in their own work schedules to be able to qualify. And so seasonal workers or workers with fluctuating hours, you know, they if if they know that they have to

meet these redetermination requirements twice a year. And let’s say they’re not going to meet those 80 hours for that look back period. They may in advance know they have to get some 10 extra hours of work in that month to be able to stay on Medicaid. And so having that information in advance can help people prepare to be able to potentially navigate, you know, the situation because a lot of these low wage earners, which is by definition the population of the Medicaid

expansion that we’re talking about, they they don’t necessarily have regular hours that they can rely on. They might not receive, you know, a W2 that shows that this is this is how much you earn this week. If you’re working multiple jobs and you kind of have to shift things around, this could require a lot more planning simply to just stay at that mark wherever you need to be to show both your income eligibility and the work requirement eligibility because there’s also the risk that you might potentially make too much and be kicked off, you know.

because in that six month period you made a little bit over. So there’s ways to that people might need to plan their whole year to be able to maintain that coverage.

Guy Gordon (11:46.838)
Right.

So would it behoove the state, because as as you’ve pointed out, it is in the state’s interest to have as many people on the pool as possible, both financially and otherwise, but if they are legitimately eligible to have a a a navigation system or a help system, a website where they can get assistance in filing these papers.

Karley Abramson (12:09.018)
Correct. Yeah. And so and that’s essentially the argument being that, you know, they’re they’re discussing the budget right now and you making decisions about you know where where most of these resources should be going and the argument that it is very, very important that this run as smoothly as possible because we’re already going to lose a chunk of people and there’s nothing that the state can do about it because of because those people simply won’t be eligible under the work requirements.

So because there’s nothing we can do about that, but we can get this group of people who might fall off because of those administrative burdens, that lack of record keeping, or just the errors that the, you know, the state might make simply because this is double the amount of work. we’re talking, you know, instead of these redeterminations happening once a year, they’re happening twice a year. So that’s a lot more actual personnel that is needed. Any

data and IT that can be used to kind of streamline the process is going to be really, really valuable for getting those automatic renewals. And so it’s in the state’s interest to invest up front in whatever resources they need to create the infrastructure and kind of the framework to help people navigate this because we we don’t want any more people losing coverage than than have to basically.

Guy Gordon (13:28.277)
Well, and at at the time you know there were there was some there was some criticism that this is kind of a captain obvious moment, that that the majority of people currently on Medicaid are already working. They’re just not working enough to get off Medicaid. And the notion that there were people that were on Medicaid that weren’t working that somehow that that they they could still survive and and be financially viable.

Karley Abramson (13:57.103)
Right.

Guy Gordon (13:57.292)
just based on the fact that they have healthcare coverage was really kind of a a a false argument.

Karley Abramson (14:03.246)
Yeah, so and and it’s a question of you know, the overall cost benefit for the state when you’re when we’re talking about the cost of of covering people and the cost of not. And and overall it is in the state’s interest to have people covered. and so the the cost essentially of of people who potentially could be working more but aren’t, the cost to the state is very minimal because

all those people are getting our access to medical care, which the the the way the money flows is from the federal government to insurers to Michigan medical providers. And so it is still in the state’s overall state’s best interest to have that money come in.

Guy Gordon (14:39.371)
Yeah.

Guy Gordon (14:49.409)
All right. So we’ve established that whether we’re talking about public awareness or whether we’re talking about navigation aids, similar to what we saw for people applying for COVID benefits five years ago. I mean, there’s a lot of stakeholders here, but I I I don’t s is there any group like the Michigan Hospital Association or any other advocacy groups that are ginning up this kind of a campaign to address these issues at this point?

Karley Abramson (15:16.159)
you mean on behalf of the individuals who need to or just for themselves? Yeah, I mean

Guy Gordon (15:19.979)
On behalf of the individuals, on behalf of the state, on behalf of the healthcare system that could be negatively impacted by this.

Karley Abramson (15:25.112)
Yeah, I don’t want to speak for any of the other organizations, but hospitals, you know, are concerned about the cuts. There’s many hospitals that rely a lot on Medicaid. and so hospitals definitely want to be able to you know, if someone comes into a hospital, they they want them to be covered by Medicaid. They don’t want to have to foot the bill for an uninsured person who comes into their ER, which they will do because they are required to offer care. But it is in the hospital’s interest to

Guy Gordon (15:28.063)
Karley Abramson (15:55.008)
you know, they would want people to stay on Medicaid and

Guy Gordon (15:59.298)
Right. Sturge’s hospital just closed on on June nineteenth, citing declining reimbursement, operational cost increases. so they they could be kind of a canary in a coal mine. It kind of tells you that there are already hospitals that are kind of on on the ledge. you know, how much would it be in in terms of uncompensated care or in a loss of coverage, you know, to push them over the edge?

Karley Abramson (16:09.484)
Right, and we don’t know the timeline.

Karley Abramson (16:21.145)
Right.

Karley Abramson (16:24.534)
Right. And and w depending on where you are geographically, that’s a much bigger deal. If if certain if some hospitals close in some areas, there’s alternatives and there’s there’s other entities that can provide care for you. In other parts of Michigan, and you know, we rely a lot on our rural counties that we also need to be able to make sure that they have access to care. and one hospital closing in that county could be a huge deal and could lead to enormous health consequences.

Guy Gordon (16:53.549)
Right. There there is a school of thought that for those that are currently receiving these benefits and may not be active in the workforce, and we have a huge I mean compared to the rest of the nation, our labor participation rate is significantly lower here, which is odd because we think of Michigan as a you know a very hard working state. But our labor participation rate is is significantly lower. There is a school of thought that suggests that with this work requirement

you could see more people returning to work in order to save their benefits. Is is that a legitimate spinoff benefit here that deserves at least some acknowledgement?

Karley Abramson (17:30.212)
Right.

Karley Abramson (17:35.749)
There’s the evidence that we have on it suggests no. Arkansas, I think the state of Arkansas implemented work requirements. and the from the evidence from that shows that it did not lead to any substantial increase in you know the number of people working. and it they there have been work requirements for other programs like SNAF as well. and so the evidence that we have on

Guy Gordon (18:01.036)
Mm-hmm.

Karley Abramson (18:04.018)
whether work requirements do achieve that is from my from what I know about it is is there’s very minimal evidence to support that, if any at all. so it’s a potential theory. There’s currently not evidence to suggest that that’s something we should rely on as as a source. Right. You know, it’s it it’s kind of one of those, this is an unfounded theory. It’s not that it’s impossible that this could happen, but when we’re making our decisions.

Guy Gordon (18:23.49)
Mm-hmm.

Guy Gordon (18:31.551)
Right. Because we know we’ve got a labor shortage here in the state. There’s a a lot of employers that are looking for people.

Karley Abramson (18:35.064)
Right. But so but so far, so far this has not been shown to be something that helps that labor shortage. because like you said, from the survey data that we have, most people are most of the people on Medicaid are working, looking for work. They’re just might not be able to meet that particular benchmark with the you know exact documentation twice a year the way

it the the way it they currently would need to, right? And so it’s not most of that population is is doing what we want them to do. but proving that when it comes to having the right documentation and support and communicating with a government entity and being able to show

a you know, a government entity that those are two kind of different things. The reality of what they’re doing and being able to document it enough to prove it are two different hurdles.

Guy Gordon (19:35.777)
Right.

Well, and I mean, for some people it’s going to be wash, w rinse, repeat, right? I mean, if if they have a maybe they’re working twenty hours a week at a dollar store or something like that, they’re going that’s that shouldn’t be too heavy a burden, but is there ways that we could make this easier or more automatic? I hesitate to d use the term automatic because you want to make sure that people do indeed meet these qualifications.

Karley Abramson (19:59.183)
Yeah, and that’s

Karley Abramson (20:04.92)
Yeah. So any any data that they can get from any other programs that somebody is enrolled in. So again, if they’re enroll r enrolled in SNAP or there’s another subsidy or benefit that they are getting and they already have to submit work work requirements for those, being able to streamline and be able to get access to that first so that the state can then automatically apply those to this, right? So people don’t have to kind of double the number of paperwork or triple potentially to be able to prove to various different, you know.

programs that they are meeting these requirements. And and so yeah, so it’s a little bit this is one of those things where the the details of it are beyond my expertise in the sense of how data and IT wise that they can invest to be able to automate this as much as possible. But there are ways and that’s why it’s it’s important to if there if those avenues are available, it is in the state’s interest to take advantage of them.

Guy Gordon (20:49.75)
Uh-huh.

Guy Gordon (21:04.127)
And again, is there any evidence that we know we just had a change at the top that the Michigan Department of Health and Human Services, Elizabeth Hertel, is leaving. But I mean, have you heard of anything A, just about implementing these changes? This is something that this is the state’s responsibility. Are they preparing and are they preparing for the downstream impact of this, either with employers, nonprofits, or with individual recipients?

Karley Abramson (21:32.43)
Yeah, I mean I most of the talking points that I’ve heard have been mo more about those downstream impacts, which is is important to address. That’s but and that’s what a lot of the the concern is. And that is legitimate. And what we just wanted to kind of focus the attention on is how much this implementation piece will matter for the extent of those of those downstream impacts. And we can really

Guy Gordon (21:38.112)
Right.

Guy Gordon (21:52.406)
Right.

But I think about six months to build a website or to build a portal to to allow folks to to do this and submit the documentation.

Karley Abramson (22:04.098)
Right. And y you know, figuring out ways to be able to reach people and contact them. Things that go in the, you know, regular mail get missed, emails get missed. especially if people don’t know that they’re looking out, they’re supposed to be looking out for something. So anything that the state can do to reach people, in a way that will not only tell them what’s going on, but make sure they understand what is at stake. Because is this the

Guy Gordon (22:29.26)
Mm-hmm.

Karley Abramson (22:30.968)
That’s one of the things about this is that the stakes of it are particularly high. If you are kicked off Medicaid and you don’t have insurance, and then something happens and you have to pay a medical cost during that time when you’re uninsured, future insurance won’t help you. If you get back on Medicaid after submitting the right paperwork, that future insurance isn’t going to help you for that time period. Right. And we’ve CRC has talked about.

Guy Gordon (22:55.637)
Right.

Karley Abramson (22:59.158)
medical debt and we’ve, you know, written about that and that’s been in the news recently with, you know, more forgiveness of medical debt. But that’s another way that those costs kind of spiral on people. and so when the stakes of it are that high, both financially and and health wise, it’s really in the state’s interest to not just get people back on Medicaid if they go off it, but make sure that they they never lose coverage to begin with.

Guy Gordon (23:12.012)
Mm-hmm.

Guy Gordon (23:26.547)
Okay. So final thoughts. We need to raise public awareness. We need a navigational tool to help those who have to document these things before. And we also need to make sure that the state of Michigan has some way to transfer existing documentation to this purpose. Anything else that we need to to acknowledge before we wrap things up?

Karley Abramson (23:47.766)
I know, I mean, there’s any other things also that I’m kind of outside of the the field of implementation and how they can do it. But it’s essentially as we are considering where we want resources to be appropriated right now. even if we don’t know specifically how that navigational kind of pathway is going to work, that is where we want resources to be going at

the moment because the long-term impacts of this are very, very costly. So we want that upfront investment in whatever avenues are available to us.

Guy Gordon (24:25.069)
Right. So county health leaders, township health leaders, anybody that is in the the the the public interface with people that are going to be using the healthcare system, including hospitals, need to step up because the clock is ticking. Kelly, thanks so much. And of course you can read Kelly’s research on this at CRCMish dot org. Thanks, Car Karley

Karley Abramson (24:33.974)
No.

Guy Gordon (24:51.062)
Until next time, I’m Guy Gordon. Take care. And of course, you can always find our Facts Matter podcast anywhere where you get your podcast, be it Spotify, YouTube, Apple, and tell a friend that this is where they can find fact-based reporting. Take care.