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Independence, to provide a health care coverage pathway for families whose income is currently too high to qualify for South Carolina Healthy Connections Medicaid but too low to qualify for federal subsidies in the federal marketplace. The demonstration seeks to build a state-specific solution to eliminate the financial disincentives for employment that currently exist due to the all or nothing approach to Medicaid expansion as authorized under the Patient Protection and Affordable Care Act (ACA). Specifically, the Palmetto Pathways to Independence waiver program will establish a new eligibility pathway for adults aged 19-64 who otherwise meet eligibility criteria under the PCR coverage group and have an income that is above 67% and below 95% FPL with a 5% disregard, effectively including individuals with income between 67%-100% FPL. South Carolina's goals for the demonstration are to incentivize employment and close the health care coverage gap created by ACA. The demonstration will support strategies to: • Remove health-related barriers to employment; • Promote member transition to commercial health insurance; and • Support the long-term, fiscal sustainability of the Healthy Connections Medicaid program. Individuals eligible for the demonstration will be required to participate in 80 hours per month of community engagement activities to gain and maintain Medicaid coverage through the demonstration. Qualifying community engagement activities include: • Employment for no less than 80 hours per month; • Participation in an adult secondary education program through a public school district or technical college, including vocational education and training programs, as a full or part- time student. Full or part-time student is defined as one who participates in at least 12 hours per semester (or equivalent); or for part-time students, a total of at least 12 hours over the course of two completed semesters during a 12-month period that shows a participant is achieving the state unit's academic standards; • Participation in a degree- or certificate- seeking program in an accredited institution of higher education, as defined by the South Carolina Commission on Higher Education as a full or part-time student. Full or part-time student is defined as one who participates in at least 12 hours per semester (or equivalent); or for part-time students, a total of at least 12 hours over the course of two completed semesters during a 12-month period that shows a participant is achieving the state unit's academic standards; • Compliance with unemployment insurance (UI) work-search requirements (first 16 weeks of UI benefits); • For dual Medicaid-Supplemental Nutrition Assistance Program (SNAP)/ Temporary Assistance for Needy Families members, demonstrated compliance with SNAP community engagement standards; • Participation in/compliance with medically necessary substance use disorder treatments; and • For individuals who are a member of the Catawba Nation, additional qualifying activities may include participation in tribal economic development programs including on-the-job training, the 8(a) Status program, or volunteer opportunities through the Catawba Nation. 25