Iowa Wants Its Poor to Give Up Smoking and Drinking to Qualify for Medicaid

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The Obama administration gave Iowa a waiver today to expand Medicaid along lines similar to what Arkansas did earlier this year, in which Medicaid dollars will be used to buy insurance in the private marketplace. I’m OK with this as an experiment, and curious to see how it turns out. But there was another wrinkle to Iowa’s waiver application:

Iowa wanted to do something different. Gov. Terry Branstad (R) wanted to charge a small premium for Medicaid enrollees who earn between 50 percent and 133 percent of the poverty line. In the Arkansas plan, there were no premiums at all.

Health and Human Services essentially split the difference with the state here: They’re allowing premiums for those who earn between 100 percent and 133 percent of the federal poverty line, but not for those who earn below that. The premiums are limited at 2 percent of income (for someone at the poverty line, this is about $19 a month), and enrollees have the chance to reduce their payment by participating in a wellness program.

Hmmm. Iowa’s waiver application doesn’t describe this wellness program (a draft protocol will be submitted next March), but it does provide a hint about its goals:

The state shall submit for approval a draft section of the protocol related to year 1 Healthy Behavior Incentives including, at a minimum….the health risk assessment used to identify unhealthy behaviors such as alcohol abuse, substance use disorders, tobacco use, obesity, and deficiencies in immunization status.

A single person at 50 percent of the poverty line makes less than $500 per month. That’s obviously not someone who can afford even a nickel in extra expenses. But that was the income level in Iowa’s initial application, which means that for all practical purposes the original goal of this program was to (a) deny government benefits to poor people who are smokers, drinkers, drug users, or overweight, but (b) provide the benefits if these poor people agree to fairly intrusive government monitoring that ensures they improve these behaviors.

So here’s a question: what’s the liberal party line on this kind of thing? Are we opposed because conservatives are once again trying to deny benefits to the “undeserving” poor? Or are we in favor of this because using incentives to improve destructive lifestyles among the most vulnerable is a worthy effort? Does it matter whether the motivation for these incentives is something we approve of? If a lefty foundation launched a program that helped out poor families via a tough-love style approach that insisted on modifying destructive behavior, would it be OK? How much difference does it make that one is a public program and the other is private?

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