Indiana became the third GOP-led state to suspend efforts to impose a work mandate to Medicaid on Thursday, dealing another blow to the Trump administration's attempt to overhaul a program that provides free health insurance to tens of millions of low-income Americans.
The state's Family and Social Services Administration cited a pending lawsuit when it halted the program, according to a press release. The Indianapolis Star reported in September that the case was filed by four Indiana residents who argued work requirements would harm them and thousands of other Medicaid beneficiaries in the state.
Indiana was the last state to have an approved and implemented work requirement program for Medicaid, which went into effect in January. 1.4 million residents are enrolled in it.
In a statement, the Centers for Medicare and Medicaid Services, which manages the nation's federal health insurance programs, told Business Insider they would keep working with Indiana to ensure "a successful implementation of their program" and defend initiatives "designed to lift people out of poverty."
Vice President Mike Pence and CMS Administrator Seema Verma both played a role shaping the state's expansion of Medicaid under the Affordable Care Act, the Washington Post reported. Pence was formerly Indiana's governor while Verma was a consultant who managed the state's healthcare system.
The state ended up taking a more gradual approach to avoid spurring confusion and generating massive coverage losses as had happened in other states like Arkansas, according to the Post.
Over 18,000 people were booted from the coverage rolls in Arkansas. Kentucky and New Hampshire also faced substantial criticism and the three states have their job mandate programs ensnared in court. New Hampshire, a Republican-led state, suspended its program before it was struck down in court alongside Kentucky.
Arizona — another state with a Republican governor — quietly halted its efforts to enact a work requirement program on October 21, even as it had received permission from the federal government to move forward.
The Trump administration has allowed states to adopt Medicaid work requirements for the first time, arguing it encourages beneficiaries to be self-reliant and will ultimately move them away from public aid.
And Verma has connected the overhaul as a pathway to improved health outcomes and better employment opportunities. But public health advocates say the job mandate only makes it harder for people to access health coverage.
Nine states have waivers pending before the federal government, according to the Kaiser Family Foundation. Five states have earned federal approval to enact job mandates and nine others have applied to do so.
A preliminary study from the Government Accountability office published earlier this month found that a handful of states enacting the work mandate had wasted over $400 million, triggering a wave of criticism from Democrats.