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How Medicaid work requirements can exempt rural whites but not urban blacks

Michigan has a new plan that could disadvantage poor black beneficiaries while providing relief for poor whites.

A rally in defense of Medicaid during the Obamacare repeal debate in 2017.
Erik McGregor/Pacific Press/LightRocket via Getty Images
Dylan Scott covers health care for Vox. He has reported on health policy for more than 10 years, writing for Governing magazine, Talking Points Memo and STAT before joining Vox in 2017.

When the Trump administration announced it would allow states to institute Medicaid work requirements, policy experts warned that it could lead to racial discrimination. A proposal in the Michigan legislature that would exempt some counties from the requirement suggests how this could happen.

In Michigan, as the Detroit Free Press’s Nancy Kaffer noted, state lawmakers are pushing a plan that would require Medicaid recipients (with exceptions for the disabled, elderly, and a few other selected populations) to work or search for work at least 29 hours each week. If they fail to meet the work requirement, they could lose Medicaid coverage for a full year.

But the Michigan plan comes with a twist: People who live in counties with higher unemployment rates — above 8.5 percent — are exempted from the requirement. That is likely to lead in practice, as Kaffer observes, to rural whiter counties, where unemployment is higher, getting a break from these work requirements while urban areas with a higher share of black residents would still be subjected to them. Which means that black Medicaid enrollees would be more likely to lose their health insurance.

Whatever the intent, that appears to be the practical effect. George Washington University’s Sara Rosenbaum warned me about this possibility when the Trump administration first said it would approve Medicaid work requirements:

Rosenbaum also warned about “the potential for enormous discrimination, really racial redlining.” She noted that CMS would allow states to account for local conditions, such as high unemployment in certain areas or other factors, to provide exemptions from a work requirement.

Rural areas, more likely to be white, could have fewer job opportunities, less robust transportation, and fewer social support services, all things that might lead a state to provide an exemption from the work requirement. The result, intentional or not, is that black people on Medicaid — because they are more likely to live in urban areas, where those grounds for exemption are less likely to be found — could face a higher burden under these waivers.

“All of these things are potentially much harder to come by in rural areas,” Rosenbaum said. “Because of the demographics, you could have situations where the populations required to work are disproportionately African-American.”

The Michigan plan — which passed the state Senate, though Republican Gov. Rick Snyder’s office has criticized it, leaving its future in doubt — seems like Exhibit A of the risk that Rosenbaum was describing. Let’s look at a few choice Michigan counties to illustrate.

Cheboygan County, which, as the Free Press noted, is represented by one of the authors of the Medicaid requirement plan:

  • 93 percent white, per the Census Bureau
  • 0.6 percent black
  • 18.7 percent unemployment rate in March 2018, according to the state government
  • It would therefore be exempt from the work requirement

Genesee County, home of Flint, already the site of racially fraught state policymaking:

  • 75 percent white
  • 21 percent black
  • 5.8 percent unemployment rate
  • It would there not be exempt from the work requirement

Wayne County, the big one, which includes Detroit and surrounding areas:

  • 55 percent white
  • 39 percent black
  • 5 percent unemployment rate
  • It would not be exempt from the work requirement

Wayne County is instructive in how, even in a county with a superficially low unemployment rate, people of color could be disproportionately affected by a Medicaid work requirement. The Brookings Institution reported in February of last year (so the exact data is out of date, though the trendlines surely hold) that the white unemployment rate in the city of Detroit was 4.9 percent — and the black unemployment rate was 14.5 percent.

In fact, a quick comparison of Census Bureau data and the state employment database shows that all of the counties with an unemployment rate above 10 percent are at least three-quarters white, with most of them pushing 90 percent.

Any which way you slice it, these exceptions to the Medicaid work requirement seem more likely to help poor rural white Michiganders while poor black urban Medicaid enrollees would be expected to meet the state’s new obligations or risk losing their health coverage.

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