Since our nation’s founding, Americans have valued hard work and self-sufficiency. With near record-low unemployment and seven million open jobs, the American Dream has never been more attainable. So why is the government fast-tracking its citizens on to welfare instead of connecting people with opportunities?
Across the country, state officials are using auto-enrollment to funnel people already on food stamps into Medicaid, a massive government-provided healthcare program intended to serve low-income folks and the disabled. They’re also using automatic renewals for existing Medicaid enrollees to keep them in dependency.
States are enrolling individuals in Medicaid simply because they are enrolled in food stamps. This massive loophole was developed in 2013 when Obamacare’s Medicaid expansion led to a surge in able-bodied people looking to enroll in Medicaid. The Obama administration wanted to onboard people faster into the Medicaid program, so they gave states the temporary authority to auto-enroll individuals into Medicaid based on food stamp eligibility.
This move diminished the Medicaid program’s integrity by allowing states to skip important steps like income checks and eligibility verification — all in the name of “increased efficiency.” While the shortcut was set to expire in 2015, the Obama administration extended its authority indefinitely.
The result?
States have continued to use food stamps to auto-enroll thousands of ineligible Americans into Medicaid, putting a strain on state budgets, and taking resources away from the truly needy as a result. In one swift move, the fraud and abuse that riddles the food stamp program were exported to the Medicaid program.
Medicaid eligibility requirements mean nothing if they are not enforced. The Trump administration can close this loophole by notifying states that the Obama-era window for enrolling individuals into Medicaid based on food stamp eligibility has closed, ending auto-enrollment, and giving states the authority to check the eligibility of Medicaid enrollees.
Right now, all Medicaid enrollees are given automatic eligibility renewal despite personal changes in income, assets, and eligibility. This auto-renewal makes it easier on state bureaucrats, but at what cost to taxpayers?
Medicaid waste, fraud, and abuse cost taxpayers about $62 billion in 2018 alone — more than double the amount wasted in 2013, the year before Obamacare was implemented. Several states are now facing major budget crises, and Medicaid spending is a big factor. It’s only common sense for states to verify that people still qualify for Medicaid before automatically renewing them to receive benefits each year. Life circumstances can change quickly over the course of a year, and it’s important for states to regularly monitor the eligibility of Medicaid enrollees to make sure resources are preserved for the truly needy.
While we still have not yet seen it, the Trump administration has publicly committed to proposing a rule related to Medicaid redetermination. This is good news and can help restore integrity to the Medicaid program. The administration can use this opportunity to also allow states to check for eligibility more than once a year — a longstanding option that was taken away by the Obama administration. The natural next step in the Trump administration’s reform agenda would be to also end food stamp auto-enrollment.
But Medicaid reform will not happen exclusively at the federal level: States have a critical role to play in tackling Medicaid waste, fraud, and abuse. By ending automatic eligibility renewals and taking back the reins, states can save their budgets, ensure the Medicaid program remains solvent for those who need it, and motivate able-bodied citizens to pursue the American Dream through the power of work.
Robin Walker is the Senior Director of Federal Affairs at the Foundation for Government Accountability.
