Enrollees in the Medicaid health insurance program have never had a work requirement to receive the entitlement. Idaho House Bill 138 would add a work requirement in Medicaid for those individuals who are physically able. Some background is helpful to understand the context of the bill.
Congress passed the original Medicaid entitlement in 1965 as a health insurance safety net for the most vulnerable low-income people in the United States. These individuals include the poor, parents with children, the disabled, and those needing long-term care. Medicaid is a pure welfare plan financed by both state and federal taxpayers.
Although Medicaid began with a very limited enrollment, the program has exploded and financially is one of the largest budget items for every state in the union. The original program was set up such that the federal government would match the financing with states in a 50/50 percent arrangement. The federal government gradually increased its spending percent. For example, it currently pays 68 percent of the original Medicaid program costs in Idaho.
The Affordable Care Act, aka Obamacare, became law in 2010, with most benefits beginning in 2014. After litigation all the way to the U.S. Supreme Court, the law was amended such that states could decide for themselves whether to expand Medicaid to any able-bodied 18 to 64 year old person. The incentive is that the federal government would pay 90 percent of the financing of the expanded program. Idaho is one of 40 states that chose to expand Medicaid under Obamacare.
State officials unfortunately look at the Medicaid program as “free” federal money. Unlike other state budget items, for every state dollar legislators spend on Medicaid, they get at least one matching federal dollar. Of course, state and federal taxpayers are the same individuals, families, and businesses. The Medicaid program is one of the federal government’s largest non-discretionary spending programs. Inflation adjusted spending the first year of Medicaid was $10 billion compared to $900 billion for fiscal year 2023. In other words, Medicaid spending has dramatically increased far beyond inflation alone.
There has never been a federal work requirement to receive Medicaid benefits. However, the first Trump administration encouraged states to seek federal waivers and institute their own work requirements. Thirteen states had work requirements approved, but only Arkansas actually established a plan that had the consequence of losing Medicaid for non-compliance. Either courts or the Biden administration rescinded all the approved waivers, with the exception of Georgia which won its own court battle. Many states, including Idaho, are now seeking a work requirement waiver from the second Trump administration.
Spending on Medicaid in Idaho is revealing. In 2016, Idaho taxpayers paid $2.10 billion on the Medicaid program. The state expanded the entitlement as allowed under Obamacare in 2018. By 2019, the state spent $2.45 billion, which grew to $4.68 billion by 2024. Obviously, enrollment in the program increased, but the burden on Idaho taxpayers almost doubled in those eight years adjusted for inflation.
In a recent poll from the Mountain States Policy Center, 63 percent of Idaho residents favor some type of work or community service requirement for physically able adults as a condition to receive Medicaid. This is not exactly a partisan issue with 71 percent of Republican respondents and 58 percent of Democrat respondents favoring a work requirement. Currently, 68 percent of adults in Idaho’s Medicaid program work either full or part-time. This is higher than the national average of 64 percent.
Medicaid, as it is currently organized, is a pure entitlement. If a person qualifies, they can enroll and taxpayers will cover their health insurance. It seems only logical and fair that if an individual can physically work, they should be required to do some type of job or community service to receive the welfare program. With a favorable Trump administration, Idaho officials should seriously consider the proposed work requirement in HB 138 and apply for a Medicaid waiver.