On August 10, 2021, the Centers for Medicare & Medicaid Services (CMS) sent letters to the states of Ohio, South Carolina, and Utah that followed up on February 12 letters, rejecting those states Medicaid waivers that attempted to impose work requirements for people seeking health care coverage under Medicaid. The letters signed by CMS Administrator Chiquita Brooks-LaSure outlined the reasons why the waivers were rejected.


The February letters to the states indicated the CMS concern over the work requirements and their impact on access to health care. That concern increased in light of the impact of COVID-19 on both the economy and access to needed health care coverage.


The August letter to the state of South Carolina pointed out that despite the state submitting additional information, “…information that South Carolina submitted did not address the concerns we raised in the February 12, 2021, letter. Specifically, the state did not dispute that the COVID-19 pandemic has had a significant impact on the health of Medicaid beneficiaries, including a discernible uptick in substance use disorder and mental health crises in the state, or that there is uncertainty about the lingering health effects of COVID-19. The state did not provide information to demonstrate how it would minimize coverage losses of at least 7,100 individuals (5,100 for non-completion of required hours of qualifying activities and another 2,000 for lack of timely documentation) by the end of the first full year of implementation….”


The Trump Administration issued the waivers under CMS Administrator Seema Verma. In 2018 CMS issued guidance to let states implement work rules for the very first time. Some of the first states efforts to create new work requirements were stopped or placed on hold by the courts, and as a result, the work rules weren’t in effect in any states when the Biden Administration started, and Brooks-LaSure wrote that the requirements “are not likely to promote the objectives of the Medicaid statute.”


The states in question had begun to implement their work requirements, but the COVID-19 pandemic caused them to suspend their efforts, but the impact could have been significant even without the virus. According to the CMS letter to Utah, “…the Commonwealth Fund estimated that Medicaid coverage losses could be between 10,000 and 17,000 beneficiaries within the first 12 months of full implementation of the community engagement requirement in Utah, representing a coverage loss of 15–20 percent out of the estimated total population of 67,000–87,000 beneficiaries who could be subject to the requirement in the state.” In Ohio, citing the same source, the estimates were that Medicaid coverage losses could be between 121,000 and 163,000 beneficiaries within the first 12 months, a coverage loss of 26–35 percent of the projected 466,000 beneficiaries subject to the requirement in the state.