Pennsylvania Governor Tom Corbett has backed away from a controversial work search requirement in his big Medicaid proposal that's now under federal review. Even so, experts say it's unclear whether that move will be enough for the plan to gain final approval.

At stake are billions of dollars in federal funding for Pennsylvania, and new health care options for up to half a million residents.

Corbett wants to draw down federal funding slated for states opting to expand Medicaid, as part of the Affordable Care Act, and instead direct those funds toward helping low income residents buy private insurance.

Health officials have granted a few states, including Arkansas and Iowa, permission to do just that. But Corbett's plan differs in other ways.

It originally mandated able bodied residents who work fewer than 20 hours a week to take part in a job training program in order to access coverage.

In a letter sent to the U.S. Department of Health and Human Services this week, Corbett offered to instead set up a voluntary pilot plan tied to even more discounts on premiums and copays for those who participate. At least for the first year, such copays and premiums would be minimal, matching current amounts and ranging anywhere from $.50 to $3.00; with one exception, a flat $10 copay for non-emergency use of emergency rooms.

Joan Alker, a professor at Georgetown University and close tracker of Medicaid, says tying anything work-related to Medicaid would break new ground.

"Medicaid is not a job training program, Medicaid is a health program," she says.

A plan moving forward in New Hampshire includes offering job training referrals to enrollees, but doesn't go as far as Pennsylvania in setting up a program within Medicaid.

"Fundamentally his [Corbett's] waiver proposal still has a lot of problems, but at the end of the day I do think it's good news that he's willing to make some changes," says Alker.

Other possible issues: new premiums, changes to current benefits

Marybeth Musumeci, with the Kaiser Family Foundation's Commission on Medicaid and the Uninsured, has been analyzing state waivers and says Pennsylvania's is different in other ways, too.

"Its waiver is not focused just on the newly eligible adults, but it's also proposing some changes to benefit packages that would affect currently eligible beneficiaries," says Musemeci.

In year two, Corbett's plan also proposes across the board premiums for people earning between about $11,000 and $15,000 dollars a year. Premiums would be $25 a month for an individual or $35 for a family. Initially, Corbett also proposed premiums for people below the poverty line, but removed the requirement in a revised proposal, submitted last month.

Officials did approve premiums in Iowa's plan, Musumeci points out, though the amounts are lower than what Pennsylvania is proposing and capped at two percent of a person's household income, similar to the caps for buying private coverage through health exchanges.

As part of the formal review process, the Centers for Medicare and Medicaid (CMS) is taking public comments on Corbett's plan through the end of the month. In an email, CMS spokesperson Aaron Albright said this agency "will examine this latest proposal [the job search pilot], and will consider input during the public comment period and provide technical assistance to Pennsylvania on their waiver application before making a decision."

Musemechi and Alker both say there are still a lot more details that need to be flushed out and a lot of moving parts in the negotiating process.