- Associated Press - Thursday, March 6, 2014

HARRISBURG, Pa. (AP) - Gov. Tom Corbett appeared ready Thursday to drop one of the most controversial conditions of his proposal to accept billions of federal Medicaid expansion dollars and extend taxpayer-subsidized insurance to hundreds of thousands of working poor in Pennsylvania.

Until this week, the Corbett administration had sought to require able-bodied, working-age Pennsylvanians to complete certain work-search activities as a condition of receiving coverage through an expansion of Medicaid-funded insurance under the 2010 federal health care law.

But Corbett, a Republican, has shifted in the face of opposition from the Obama administration. He is now asking U.S. Health and Human Services Secretary Kathleen Sebelius for a chance to institute what he calls a voluntary, incentive-only one-year pilot program for able-bodied adults.

Corbett’s top policy adviser, Jennifer Branstetter, said the administration is not backing down. Rather, it is providing an alternative that is designed to win approval from Sebelius, whose concerns over a job-search requirement are “ideological and philosophical,” Branstetter said.

“This comes down to whether President Obama is going to work in good faith with the state,” Branstetter said Thursday.

A Health and Human Services spokesman did not respond to a request for comment Thursday.

Since he first began discussing it publicly last year, advocates for the poor and uninsured had warned that no state has ever been allowed to tie Medicaid coverage to such a requirement and that it simply isn’t allowed by federal law.

Sebelius‘ agency has told the Corbett administration for months that it would reject the work-search requirement, said Joan Alker, executive director of Georgetown University’s Center for Children and Families, who has closely followed states’ Medicaid expansion plans.

However, Alker said Corbett’s new work-search approach also will meet federal rejection and that he will need to find a different way to connect Medicaid-funded coverage and the state’s work-search program, perhaps through a joint application.

“The bottom line is, Medicaid is not a job-search program, and so he can’t run his job-search program through Medicaid,” Alker said.

Corbett has argued that a work-search requirement would help move people off taxpayer-funded health insurance, but advocates for the poor and uninsured say it will simply function as a barrier to people getting health care.

The work-search requirement was one of many modifications being sought by Corbett to the Medicaid expansion envisioned by the 2010 federal health care law. Corbett also wants to use the federal Medicaid dollars to purchase private insurance policies, rather than expanding the traditional Medicaid coverage, and he hopes to scale back benefits for healthy, working-age adults who are eligible for the current Medicaid program.

All of those changes require federal approval.

The federal Medicaid expansion dollars became available to states Jan. 1. The Corbett administration has said that it would not be ready to administer a Medicaid-funded expansion of health insurance until 2015, and the Kaiser Family Foundation estimates that 281,000 low-income Pennsylvanians will be left without a health care option under the law until then.

In a Wednesday letter to Sebelius that outlined his shift in stance, Corbett did not say whether the administration would pursue a work-search requirement later.

He told Sebelius that the number of adults who receive federal cash assistance benefits and are working has risen 8 percent since his administration reinstated “work-related requirements” and proposed sharing the first year’s results of the voluntary work-search program under Medicaid with Sebelius.

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