We have a dependency crisis in Minnesota, and it’s getting worse every year. If political leaders decide to ignore this problem and don’t act soon, many of our severely and permanently disabled Minnesotans, along with many elderly citizens and children, won’t receive the benefits they deserve. It’s a simple equation: Every tax dollar spent on Medicaid/Medical Assistance (MA) benefits for able-bodied adults is a dollar that can’t go to the truly needy. There’s a simple solution that is working in various states around the country that is being maligned in Minnesota by those who wish to preserve the welfare status quo.
How and when did 1 in 5 Minnesotans come to rely on Medicaid for their health insurance?
One of the most important changes in how low-income Americans access health insurance occurred in 2010, when Congress passed and President Barack Obama signed into law the Affordable Care Act (ACA). Tucked away in that massive bill was an important clause that allowed states to expand Medicaid, the combined federal and state health insurance program that provides insurance to nearly 60 million low-income Americans. We were one of the first states to “expand Medicaid” coverage in 2013.
Today, there are more than 324,000 able-bodied Minnesotans enrolled in Medicaid. Of those, 181,000 are new able-bodied enrollees who became eligible under the 2013 expansion. This number of enrollees is more than any actuary or politician predicted would ever sign up for this program.
This expansion comes at a price: Starting in 2020, Minnesota taxpayers will receive a bill from the federal government for 10 percent of the total cost of this program. As the federal government begins to require state taxpayers to pay more and more for this program, other state programs will begin to be crowded out in their requests for funding, including key budget items such as K-12 education and transportation.
Some state government leaders are looking ahead and seeking solutions to this problem now. One proposal under consideration is a modest work requirement that would enable able-bodied Medicaid recipients to transition into profitable work and private health insurance. This would not apply to those medically disabled, those with dependent children or the elderly. Similar plans have been enacted by several other states, all of which report that this transition to work has garnered greater income for Medicaid recipients that surpassed the benefits they were receiving while on welfare.
I know of no one who would dispute the importance of a government safety net for the truly needy. Yet those who seek to preserve the status quo seek to distract us from the goal of preserving benefits for those permanently disabled individuals by spreading myths and falsehoods about the pending solutions to a tough problem.
For example, some say that “most adult nondisabled MA beneficiaries already work.” Yet, according to a federal government analysis of enrollees, most enrollees do not work at all, and less than 10 percent of these enrollees work full-time jobs.
Another myth being repeated is that it is going to cost the state more money to monitor and assist those seeking jobs. In other words, finding a full-time job isn’t worth the expense it will cost state government.
When Kansas initiated work requirements for able-bodied, childless adults, caseloads dropped by 75 percent and the average amount of time spent on welfare was cut in half. Individuals who left welfare obtained employment in more than 600 different industries and saw their incomes skyrocket, more than doubling, on average, their lost welfare benefits. Other states saw similar decreases in workloads for state caseworkers charged with monitoring welfare recipients. But most important, many states are looking into the future and realize that benefits must be preserved for their state’s severely disabled, elderly and children. The best way to do that is to encourage those who can work to do so — now.
Finally, the most hurtful myth is that many able-bodied Minnesotans currently receiving Medicaid are unable to find work. Yet our own state government agencies report otherwise. There are currently 123,000 unfilled full- and part-time jobs open for residents throughout the state. According to Minnesota Public Radio, “there are just eight unemployed people for every 10 job vacancies. In greater Minnesota, there are 11 people for every 10 openings.” The demand for workers continues to be strong in nearly every one of Minnesota’s 87 counties. And, as most of us learned at a very early age, a job is the best way out of poverty. And lest you think that these job vacancies are all at McDonald’s and other fast-food restaurants, Minnesota’s Department of Employment and Economic Development reports that “the median wage offer for all job vacancies was $14.39 per hour” — an increase from 2016.
But most disturbing is the argument that work is somehow punishment and that starting wage jobs are undesirable and unfair and will trap workers in poverty in perpetuity. Nothing could be further from the truth.
American Enterprise Institute president Arthur C. Brooks carefully and artfully describes the benefits we all have received working at paid, transitional work. It is our duty, Brooks writes, to make sure that those who face complex factors “that can keep people from climbing the economic ladder” of success find help. But, Brooks says, “our thinking must start with the truth that work is vastly better than no work for the soul. Honest, productive work per se is never a punishment. Work is a blessing.”
Other states are actively moving ahead to help their able-bodied citizens rejoin the workforce. This critical reform is rapidly spreading and is a win-win for the individuals trapped in dependency by our state’s welfare policies. Work is what works to free people from dependency. Work is a blessing. It’s time to get more Minnesotans working once again.
Annette Meeks is CEO of the Freedom Foundation of Minnesota.
Editor's note: An earlier version of this commentary misstated the number of Minnesotans who use Medical Assistance (Medicaid) in one of two locations where it originally cited the figure. According to the Minnesota Department of Human Services, more than 1 million Minnesotans are covered by Medicaid, or about 1 in 5. According to the Foundation for Government Accountability, 324,000 of them are able-bodied adults, about 1 in 17 residents of the state.