Medicaid work requirements become sticking point in debt ceiling negotiations

By Paige Minemyer / May 24, 2023

Negotiations on a debt ceiling deal continue in Washington, and Medicaid work requirements have emerged as a key issue in the discussions.

House Speaker Kevin McCarthy, R-California, described work requirements as a "red line" in the negotiations with President Joe Biden on a deal to avoid default on federal loans, according to a report from ABC News. Work requirements in Medicaid and other federal assistance programs have been a long-time Republican talking point.

McCarthy told reporters Monday that the work requirements are "only for people who are able-bodied with no dependents," according to the article.

"I don't think it's right that we borrow money from China to pay somebody who has no dependents, able-bodied to sit on a couch," McCarthy said, per ABC.

In the GOP debt package, certain adults between the ages of 18 and 55 would have to work or participate in other eligible activities, such as community service or job training, for 80 hours per month to maintain their benefits. 

The Congressional Budget Office estimated (PDF) that rolling out work requirements under this plan could save $109 billion over the next decade, a slim slice of the $4.8 trillion in savings projected in the entire debt package. The analysis estimates that 1.5 million people would lose federal funding for their coverage, though about 60% of them would likely remain in the program through state funding.

Multiple states secured federal approval to roll out work requirements programs under the Trump administration, though only one, Arkansas, fully launched them in 2018. A 2020 analysis of Arkansas' program did not find a meaningful increase in work.

While the jury is out on whether work requirements meet their stated goals, they do enjoy notable support from the public in the U.S. A poll released last week by Axios and Ipsos found that 63% of Americans either strongly support or somewhat support requiring work to secure Medicaid or Supplemental Nutrition Assistance Program (SNAP) benefits.

Of that, 80% of Republicans, 66% of independents and 49% of Democrats said they support work requirements.

"Americans have a long-standing belief in the value of work. Consequently, when presented with work requirements for government aid, particularly aid most people don't personally access, we see majorities supporting the policy change," said Cliff Young, president of Ipsos U.S. Public Affairs, as Axios reported.