The value of work requirements

In January, New Hampshire’s work requirement for most Medicaid Expansion enrollees takes effect. Opponents portray it as cruel and punitive. A new study suggests it will make Medicaid enrollees significantly wealthier. 

Granite Staters enrolled in Medicaid Expansion can have a household income of up to 138 percent of the federal poverty level. The state’s work requirement covers all Medicaid Expansion adult enrollees between the ages of 19-64, minus a long list of exclusions. Thirteen exemptions exclude populations such as the medically frail, people with a doctor’s note excusing them from work, parents of children younger than six and adults caring for ill family members. 

The state will require eligible Medicaid Expansion enrollees to participate in what the Centers for Medicare and Medicaid Services calls “community engagement” for 100 hours per month. Qualifying community engagement activities include work, job training, vocational educational training and job searching.

This requirement is not designed to punish those who receive health insurance coverage through expanded Medicaid. Rather, it is designed to help enrollees become self-supporting and avoid the many negative effects of being unemployed. 

A study released last week by the Buckeye Institute’s Economic Research Center concluded that work requirements like the ones adopted by New Hampshire could increase lifetime earnings by as much as $212,694 for women and $323,539 for men. 

The benefits go beyond the financial. Spending a long time out of the workforce produces many negative outcomes. One Urban Institute study summarized the effects this way:

“Being out of work for six months or more is associated with lower well-being among the long- term unemployed, their families, and their communities. Each week out of work means more lost income. The long-term unemployed also tend to earn less once they find new jobs. They tend to be in poorer health and have children with worse academic performance than similar workers who avoided unemployment. Communities with a higher share of long-term unemployed workers also tend to have higher rates of crime and violence.”

Work requirements for able-bodied Medicaid recipients are designed to counter those negative effects.

The Buckeye Institute study suggests that New Hampshire’s Medicaid work requirement can add to the state’s thin labor force and significantly increase the lifetime earnings of many lower-income residents. This effort deserves praise, not condemnation.