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Katiri Zuluaga

Manager, State Initiatives

Arizona Waiver Proposal Imposes Medicaid Work Requirements and Lifetime Limits

January 4, 2018 | Waivers/SPAs | Comments
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Arizona has submitted a Section 1115 Medicaid waiver request that would institute a lifetime cap on Medicaid coverage and impose work requirements on enrollees. If approved by the Centers for Medicare and Medicaid Services (CMS), Arizona’s Medicaid program will have the ability to deny or disenroll eligible individuals who fail to meet criteria to work or take educational courses and limit Medicaid coverage to five years for “able-bodied adults.” Each of these measures could significantly harm individuals with mental health and/or addiction disorders who receive care for these conditions through Medicaid.

Arizona submitted its full waiver request to the federal government on Dec. 19, 2017. While individuals with a diagnosed serious mental illness (SMI) are exempt from the waiver’s new requirements, the waiver’s language does not exempt individuals with substance use disorders. A summary of the waiver’s proposals to restrict Medicaid coverage follows.

Work Requirements: All individuals aged 19 to 54 who are physically and mentally capable of working and are between zero and 138 percent of the Federal Poverty Level (FPL) would be required to hold employment, attend school, attend an Employment Support and Development program, or some combination of those activities for at least 20 hours per week in order to maintain Medicaid coverage. If individuals fail to become compliant with the requirements within the initial six-month grace period of enrollment, they can be disenrolled and prohibited from re-enrolling until they have met the work requirements for 30 days.

Lifetime Limits: Able-bodied adults who are subject to work requirements would be limited to five years maximum lifetime coverage. This limit would not be retroactive and would only become effective upon the CMS approval date of the waiver. The limit would not apply to individuals who are eligible for an exemption to the work requirements or are employed full-time and still meet income requirements for Medicaid.

Eligibility Redetermination: Eligible individuals must verify their employment monthly to retain benefits and, if they are found ineligible, they will have three months to become compliant. If an individual fails to notify the state about a change in their compliance status, they can be banned from Medicaid benefits for up to a full year. This waiver would allow Arizona to redetermine eligibility for able-bodied adults every six months.

Imposing Medicaid coverage barriers and lifetime limits for low-income individuals living with mental health and substance use conditions would negatively impact their ability to engage in treatment and hurt community-based mental health and addiction treatment centers dedicated to serving vulnerable populations.

Read the waiver request and public comments here.