Indiana Suspends Medicaid Work Requirements Amid Lawsuit

On Thursday, Indiana suspended its Medicaid work requirement program known as Gateway to Work. Like several other states, it faced a court challenge to rules that could have eliminated health insurance for many low-income Hoosiers. 

One of the plaintiffs in the federal lawsuit is Monte A. Rose -- a 48-year-old Bloomington, Indiana man. He doesn’t have home internet access, reliable transportation or a stable job. He said he’d lose his health insurance under the state’s work requirement. 

Some 72,000 Hoosiers also were at risk of losing insurance unless they found work, volunteered or did other specified activities. That big impact is one reason work requirements are being challenged in Indiana and other states. 

READ MORE: Indiana Is Latest State To Rollout Medicaid Work Requirement

"I think it's probably important to really just look at what's going on in the in the court system right now," says Adam Mueller, advocacy director for Indiana Legal Services. 

That organization, which provides free legal help to low income Hoosiers, joined the National Health Law Program to challenge Indiana’s policy.

Similar programs in Arkansas, Kentucky and New Hampshire already have been shot down by a federal judge. Those cases are being appealed.

But even before the Indiana lawsuit, its policy was being criticized. 

"The program is already incredibly confusing, based on the reports I've heard from folks in the community," Mueller says. 

Some are concerned that pausing Indiana’s program while the lawsuit plays out will create more uncertainty. But Mueller isn’t worried.

"I don't know if it’ll create additional confusion, but it would not be the kind of confusion that would lead to people losing their health coverage," he says.  

In Arkansas, 18,000 people lost coverage after the state implemented a work requirement. And New Hampshire halted its policy when thousands were at risk of losing health insurance. 

Mark Fairchild is with Covering Kids and Families, which helps people navigate Medicaid and other state health care programs. So far, he says many people haven’t asked about the changing requirements. 

"We don't know if folks were disengaged, where they weren't getting the information about the reporting in the first place, if they'd gotten the information, but they just haven't taken the step of going online," he says. "But we know they weren't calling us confused about it." 

With just two months before the first big reporting deadline in Indiana’s program, he says those reporting work and volunteer hours to the state has been low. 

"It's difficult because since the reporting requirement is still fairly new, and we know that not a lot of people, certainly not the largest portion of those that should be reporting had gone on to the state website and reported hours," Fairchild says.

Joan Alker is executive director of Georgetown University's Center for Children and Families, a group that has opposed work requirements. She believes Indiana suspended its program for two reasons: the federal lawsuit and poor reporting numbers. 

"I think the writing is on the wall," she says. "First of all, the courts have repeatedly ruled that it's illegal. But secondly, it doesn't work." 

Alker says Indiana may be setting the tone as part of the national conversation. Three prominent federal officials hail from Indiana: Vice President Mike Pence, federal medicaid services head Seema Verma and Health and Human Services Secretary Alex Azar.

Alker says they have pushed work requirements onto the national stage. "So it's quite significant that [Verma's] own state is now pulling backwards from them." 

Indiana officials declined to discuss the lawsuit. But in a statement they said it could endanger other parts of the state's Medicaid health insurance program, affecting hundreds of thousands of Hoosiers.

Alker disagrees. 

"The judge [hearing these lawsuits] is not interested in a sweeping ruling," she says. "He's tried to be very targeted and limited in his ruling about how the secretary, given the evidence in front of him, cannot approve policies that result in people losing coverage." 

The same judge who will hear the Indiana lawsuit ruled against the government in similar cases in Arkansas, Kentucky and New Hampshire. Earlier this month, Arizona also put its work requirement on hold because of litigation concerns. 

This story was produced by Side Effects Public Media, a news collaborative covering public health.