Michigan: Gov. Whitmer signs Medicaid "Lipstick on a Pig" Bill...but she might still be able to save coverage for 70K

Back in June, I noted that the Michigan legislature was trying to slap a band-aid on the terrible GOP-passed & signed Medicaid work requirement bill (aka "God's Safety Net" bill) which passed about a year ago.

As you may recall, the original bill added fairly draconian work requirements to Michigan's implementation of the ACA's Medicaid expansion program, known here as "Healthy Michigan". Around 670,000 Michiganders are covered by the program (the number fluctuates between around 650K - 700K from week to week) today.

At the time, several reports had come out putting the number of people likely to lose healthcare coverage under the new requirements (which go into effect on January 1st, 2020) as high as 183,000 statewide, or as much as 28% of the total covered population...thousands of whom would lose coverage even if they do comply with the rules but aren't able to comply with the reporting requirements.

The "Lipstick on a Pig" bill, as I called it in June, would make those requirements slightly less onerous:

As for what these bills would actually do, the changes in Senate Bill 362 include:

• "A requirement that able-bodied recipients verifiy that they are meeting the workforce engagement requirements by the tenth of each month for the previous month's qualifying activities through MiBridges or any other subsequent system"

being changed to:

• "A requirement that an able-bodied recipient verifies that he or she is meeting the workforce engagement requirements by the last day of each month for the previous month's qualifying activities through MiBridges or any other subsequent system."

Immediately after this is added:

• "If a recipient does not verify that he or she is meeting the workforce engagement requirements by the last day of the month for the previous month, he or she may verify compliance with the workforce engagement requirements at a date after the missed date for reporting. If the recipient verifies compliance at a later date, the month is not a noncompliance month."

Basically, this gives Healthy Michigan enrollees 3 more weeks to verify compliance with the requirement each month, and also allows them to verify compliance retroactively later on if necessary in order to avoid being kicked off the program. Good.

Senate Bill 363 includes the same "able-bodied" wording cleanup, along with this additional exemption provision:

• (f) an exemption from the reporting requirement if the department is able to verify the recipient's compliance through other data available to the department.

SB363 appears to allow the state to automatically exempt the enrollee from the work requirements whether or not the enrollee requests it. Again, good.

There was also a companion piece of legislation in the state House (HB4522). I'm not sure what happened with that.

From what I can tell, it looks like SB363 was rolled in with SB362, which then passed both bodies and was just signed into law by Governor Whitmer:

LANSING, Mich. – Today Governor Gretchen Whitmer signed Senate Bill 362 into law, which will reduce the harmful impacts of Medicaid work requirements and protect Michiganders’ access to quality health care.

“The Healthy Michigan Plan I worked to pass with Governor Snyder was a landmark bipartisan accomplishment, extending coverage to more than 680,000 people, increasing primary care usage, reducing dependence on emergency rooms, and strengthening our economy. But the work requirement legislation that passed last year puts that progress at risk,” said Whitmer. “The changes I signed today will reduce the number of people who must jump hurdles to provide proof of what they are already doing, but there’s more we must do to mitigate their harmful impact. I ask that the legislature work with me to protect coverage for thousands of Michiganders."

Michigan has the most onerous work requirements in the nation. Earlier this year, independent analysis based on Arkansas’ experience suggested that as many as 183,000 people would lose coverage from Michigan’s requirements. Senate Bill 362 will help to lower this number by giving beneficiaries more time to verify compliance with the law and exempting people from reporting workforce engagement if the state can verify compliance through other available data.

So, that's some good news.

Unfortunately, this also happened:

Michigan legislators approved a budget Tuesday that doesn’t include $10 million intended to ease the transition of new rules that start January requiring Medicaid recipients to work or explain why they can’t.

Robert Gordon, director of the Michigan Department of Health and Human Services, said he was “genuinely shocked” by the move by the Republican-led Legislature.

“We have been told they want to do everything they can do to make work requirements work,” he told Bridge Magazine on Tuesday after the budget cleared the Legislature.

...At issue is a line item in Whitmer’s proposed budget for “work supports” in the Healthy Michigan plan, the expanded Medicaid program made possible by the Affordable Care Act. It now covers more than 650,000 low-income Michigan adults.

...Hoping to avoid similar problems, the Michigan health department had asked for $10 million to boost communications, address technology needs for outreach, and hire staff to work on the rollout.

...Whitmer, who opposes the work requirements, called them the nation’s “most onerous” in a letter to the Senate on Monday.

Stripping the $10 million “makes a bad situation worse,” she wrote.

“It now appears that Republican legislative leaders are less interested in giving Michiganders the facts and tools to comply with work requirements than in taking away Michiganders’ health insurance,” Whitmer wrote.

On Tuesday, she doubled down: “These budgets are a mess,” she said.

The other potential silver lining here was outlined by my friend and University of Michigan law professor Sam Bagenstos earlier this year:

...For now, Gov. Whitmer is stuck with the work requirement. But she does have room to implement it in a way that blunts its worst harms. Indeed, if she makes the right choices, she could protect 70,000 or more Michiganders from being thrown off the rolls by that requirement.

...To solve this problem, exemptions from Michigan’s new work requirement must, so far as possible, be determined automatically by state officials — without any need for application or certification by the individual beneficiaries.

...But the statute does not limit the automatic exemptions to those that it specifically enumerates. It provides that, when the Michigan Department of Health and Human Services implements the work requirement, the requirement “must include, but is not limited to,” the eligibility standards and exemptions listed in the legislation.

...The waiver itself provides the basis for further automatic exemptions. It requires Michigan, “[p]rior to implementation” of the work requirement, to “[e]nsure the state will assess areas within the state that experience high rates of unemployment, areas with limited economies and/or educational opportunities, and areas that lack public transportation.” The state must assess those areas “to determine whether there should be further exemptions” from the work requirement so that it “will not be unreasonably burdensome for beneficiaries to meet.”

That provision of the waiver — which, remember, was issued by the Trump Administration — gives Gov. Whitmer the basis for adding a new administrative exemption for Medicaid recipients in “areas with limited economies.” Such an exemption could substantially reduce the harm of the work requirement.

...If MDHHS were to administratively exempt individuals in these counties from the work requirement, the high-end estimate is that only about 109,000, instead of 183,000, people would be thrown off the rolls. That would still be a substantial harm, but it would potentially protect over 70,000 people from losing their Medicaid lifeline.

I don't know all the particulars, or how this new legislation (or the $10 million budget slash by the GOP) would impact Whitmer's options on this front, but it's something I sincerely hope she'll push as far as possible.