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If the workers are low wage who will the business replace them with, more low wage workers? That won't work, they'll still have low wage workers. Hire people at a high enough wage that the new worker no longer qualifies for Medicaid? Why bother? Just give your current workers a higher wage.
While this will affect employers up and down the business size, one of the ones that will be most affected is Walmart, since they have spent decades underpaying their workers, letting us, the taxpayers, foot the bill for Medicaid, food stamps, etc. I would say that it is past time for behemoths like Walmart to "pay their fair share".