Mississippi lawmakers look to other states’ Medicaid expansions. Is Georgia worth copying?

As the Mississippi Republican-led Legislature considers expanding Medicaid for the first time after a decade-long debate, Senate leaders have referenced other Southern states’ expansion plans as alternatives to full expansion. 

On Wednesday, the Senate Medicaid Committee passed the House Republican expansion bill with a strike-all and replaced it with its own plan, which Medicaid Chairman Kevin Blackwell, R-Southaven, called “expansion light.” The Senate is expected to take the bill up for a floor vote Thursday, with a plan that’s nearly identical to Georgia’s. 

Problems with “Georgia Pathways”

Health care policy experts don’t think Georgia’s plan is worth emulating. The state’s plan, called “Georgia Pathways,” misses out on the increased federal match of 90% that the law grants to newly expanded states, and it also doesn’t qualify for the additional $690 million federal dollars that would make expansion free to Mississippi for four years.

And the plan, touted as a conservative alternative to what critics call “Obamacare,” has cost state taxpayers $26 million so far, with more than 90% of that going toward administrative and consulting costs, according to KFF Health News. Implementing work requirements is costly and labor intensive because it involves hiring more staff and processing monthly paperwork to confirm enrollees are employed. 

“Georgia’s plan has proven to be very profitable for large companies like Deloitte (the primary consultant for Georgia’s project) but has provided health care to almost no one who needs it,” said Joan Alker, Medicaid expert and executive director of Georgetown University’s Center for Children and Families. “It’s been a terrible waste of taxpayer dollars so far.”

If the Senate plan were signed into law, Mississippi would fare the same – receiving its regular federal match of only 77% instead of 90% – and risk large administrative costs for enforcing a 120-hour-a-month work requirement and a provision that says recipients must be recertified four times a year.

Work requirements ‘costly’ to enforce

In theory, a work requirement isn’t controversial. A majority of Mississippi lawmakers in both chambers want to reserve Medicaid coverage for those who are working or exempt, with legislation that incentivizes employment in the state with the lowest labor participation rate. The problem, experts say, is that in practice, it can do more harm than good. 

Policing and enforcing the work requirement costs more than it would cost to insure the small population of unemployed people who would become eligible for Medicaid under traditional expansion, explained Morgan Henderson, principal data scientist at The Hilltop Institute at the University of Maryland, Baltimore County — a nonpartisan research group that conducted several studies detailing what Medicaid expansion would look like in Mississippi. 

“Medicaid work requirements are costly to implement,” Henderson said. “States have to develop new administrative systems which can cost millions, or tens of millions, of dollars. Additionally, employment reporting requirements can be confusing and burdensome for individuals, so people who are legitimately employed and income-eligible for Medicaid may be denied coverage – thus, hurting the exact individuals who are supposed to qualify for Medicaid with work requirements.”

In Georgia, only 3,500 people have signed up since the program began in July – despite the millions of dollars taxpayers have paid to run the program and officials’ previous estimate that roughly 25,000 people would sign up in the first year and 52,000 by the fifth year. 

Lt. Gov. Delbert Hosemann said in an interview in February that the Mississippi Senate plan likely wouldn’t be as strict as Georgia’s, calling their work requirement “onerous.” 

But the Senate plan is even stricter than Georgia’s, calling for at least 120 hours of work a month instead of the 80 hours required in Georgia. 

In Arkansas, a work requirement was briefly implemented in 2018 before it was overturned.

A study by the New England Journal of Medicine found Arkansas’ work requirement to be unsuccessful at increasing employment. The main consequence of the state’s work requirement was an increase in the number of uninsured persons compared to full expansion and “no significant changes” in employment associated with the policy, according to the study. 

In addition, “more than 95% of persons who were targeted by the policy already met the requirement or should have been exempt.”

What’s next?

The only expansion bill still alive in the Mississippi Legislature is House Bill 1725, authored by Speaker Jason White, R-West, and Missy McGee, R-Hattiesburg, which is now before the Senate. The bill, as passed by the House, has a provisional work requirement, but would expand Medicaid to 138% of the federal poverty level – even if a work requirement is not approved by federal Centers for Medicare and Medicaid Services. 

That’s important because during the Biden administration, the federal government  has rescinded work requirement waivers previously granted under the Trump administration and has not approved new ones. 

But the Senate version is entirely contingent on the work requirement, calling for a minimum of 120 work hours a month and quarterly recertification. Eligibility also only goes up to 100% of the federal poverty level. 

If the Senate were to stand firm on the work requirement, expansion might not go into effect until well into 2025. That is, if a new administration takes office. 

A provision in North Carolina’s recent expansion bill could prove useful as Mississippi lawmakers debate the details of expanding Medicaid.

A North Carolina expansion bill passed in 2023 is a mostly-traditional expansion plan with a unique work requirement provision. Expansion originally passed without a work requirement, but included a provision that says if or when a federal administration that favors the concept takes office, the state will change Medicaid eligibility rules and adopt the work requirement. 

If Mississippi were to include this kind of language in its own bill, it could expand Medicaid in 2024 or at the start of 2025, instead of waiting well into a new presidential term.

In theory, work requirements make sense, Henderson said. But they haven’t produced the desired outcome of increasing the labor force participation rate in other states. That fact, coupled with the costly administrative burden of enforcing them and the unfortunate consequence of eligible enrollees losing coverage make the work requirement an unworthy pursuit, Henderson and Alker conclude. 

“In theory, it’s true that, under Medicaid expansion, individuals earning slightly more than 138% of the federal poverty level could have an incentive to reduce their earnings in order to qualify for Medicaid,” said Henderson. “However, there are reasons to believe that this will be rare.”

The three reasons Henderson gives are: “First, not all workers know their exact income as a fraction of the current federal poverty limit, which changes every year and is a function of household size. Second, not all workers can control their hours. Third, individuals earning just above 138% of the federal poverty level have access to generous subsidies through the insurance marketplace, which could reduce the incentive to reduce income to qualify for Medicaid.”

And in practice, Henderson said, “no studies I’m aware of have found evidence of Affordable Care Act Medicaid expansions having adverse effects on employment outcomes.”

The Senate is expected to vote on House Bill 1725 on Thursday. While the bill only needs a three-fifths vote to pass the floor, it realistically needs a two-thirds majority from both chambers to show it has the potential to override a threatened veto from Republican Gov. Tate Reeves.