'Alabama's new catch-22': Testimony from Arise's Kimble Forrister against Alabama's Medicaid work requirements plan

Arise executive director Kimble Forrister testified against Alabama’s proposed Medicaid work requirements waiver during a public forum on Monday, March 5, 2018, in Montgomery. Here is the full text of Forrister’s prepared remarks:

When we compare Medicaid’s waiver proposal to DHR’s welfare reform proposal in 1996, what’s most striking is Medicaid’s lack of data. How can we analyze the target population when Medicaid can’t give us information on the adults in the POCR (Parents and Other Caretaker Relatives) population?

I learned a lot when I served on Gov. Fob James’ Welfare Reform Commission. First, we analyzed Gov. James’ unjustified claims that the AFDC program (that was Aid to Families with Dependent Children, the cash welfare program now called TANF) incentivized teen pregnancy, and that AFDC was a budget-buster. In fact, it just didn’t make sense that any woman on welfare would get pregnant just to gain an additional $29 a month in welfare benefits. And with cash welfare amounting to one-half of 1 percent of the General Fund budget, it was hardly a budget-buster.

Again today, we hear unjustified claims from our governor. Gov. Kay Ivey says she wants to save taxpayer dollars and reserve Medicaid for the people who need it most. But who needs Medicaid more than the mother who’s trying to support two kids on $312 a month or less?

Even the woman who works 10 hours a week at minimum wage makes too much to meet this standard. And if this new policy “succeeds,” and she gets a 20-hour-a-week job, she is no longer eligible for Medicaid – and that defeats the whole purpose. Her new low-wage job is unlikely to provide health coverage. Her income is unlikely to be high enough to allow her to buy coverage on the marketplace. She will be caught in Alabama’s new catch-22.

Changes like this can be game-changers – but they can change the game in a bad way. We learned it the hard way in the 1990s. Well-meaning professionals in the Family Assistance section of DHR (the Department of Human Resources) assured us that there were three kinds of people among the 26,600 adult recipients (note that this was about a third of the POCR population):

  • There were those who were only using cash welfare as a temporary program that would help them get back on their feet, and they would be back in the workforce in a three to six months. They had data to show that this was a large share of the caseload. And apparently today’s Medicaid Agency is unable to do a similar analysis of the POCR caseload.
  • At the other end of the spectrum were the hardship cases who faced extreme barriers to employment, and the professionals assured us that they would be protected from harsh consequences. They truly needed the program. We would think that these are among the 4,000 to 5,000 adults now on TANF, about a sixth of the original population.
  • The professionals assured us that a middle group – between the job-ready at one end and the hardship cases at the other – were the people who just needed a kick in the pants to get off welfare and into a job, any job, and that it was easier to move up the ladder from any job than from no job.

This analysis makes some sense, but only in the context of an understanding of the barriers: women on welfare consistently said that in order to enter the workforce, they needed four things: jobs, child care, transportation and health care.

DHR in fact made some effort in these areas. People could count on a year of Medicaid coverage and child care when they took a job, and they even got a few months of cash welfare to ease the transition to work.

But we analyzed the data from the first year of implementation and discovered that the numbers didn’t match the theory. An economist on our staff did a regression analysis and discovered that the numbers in the caseload did not line up with the numbers moving from welfare to work. Instead, the lower caseload numbers lined up with the lower number coming in the front door, not the number leaving for employment.

The reality was, these women could not overcome the challenges of child care and transportation to even go to the job interviews that were required before they could get TANF benefits. The theory – that a kick in the pants would lead to a job – did not explain the numbers. The reality, played out for thousands of women across the state, was that some our most vulnerable people – young mothers who can’t access child care and transportation – were denied the $50 a week we provide in TANF benefits.

We would urge the Alabama Medicaid Agency to take a hard look at its theories and compare the theories to the numbers. Are you actually cycling a significant number of cases through a transitional period of difficulty between jobs? If so, you probably don’t need a big increase in administrative costs to get them to work.

Medicaid’s own projections show that some 57,000 people in the POCR caseload will be exempted from work requirements. But the administrative cost of making that determination will add significantly to our famously low-overhead Medicaid budget. It won’t be so low-overhead anymore.

The group that’s left – perhaps 17,000 people who are not job-ready and not hardship cases – is the group that’s at risk of essentially being kicked while they’re down. If you can’t arrange child care and transportation to start on the path to a job, you’re not getting help. You’re getting the front door slammed in your face.

Bottom line: In a state with 18.5 percent of its people in poverty, this plan proposes to put about 1.5 percent of its people under a microscope, expecting to find about 1/3 of a percent they can move off Medicaid. Gov. Ivey is proposing to put a huge administrative effort into forcing this 1/3 of a percent of the population into jobs, with the result that a few thousand mothers might get jobs, but they surely will no longer have health care.

If Alabama seriously wants to test its ability to move people from POCR to the workforce, why not propose a one-year pilot program that offers work supports without the penalties that remove their health care?

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