Work Requirements: State Readiness Update
Medicaid Work Requirements will be in effect nationwide by January 1, 2027. The Center on Children and Families at Georgetown has been tracking state preparations for these new rules. We are now past the point that states were required to start sending initial outreach messages to eligible or enrolled Medicaid recipients. (Check out the state roadmap on Medicaid Work Requirements roll-out from the Modern Medicaid Alliance). CCF outlines the initial signs that states are struggling to meet federal requirements under HR1:
- Medicaid renewals are not being processed. States have a growing number of renewal applications that have yet to be processed. These pending renewals might indicate that workers are struggling to keep up with renewal work, or that states are struggling to implement system updates.
- Medicaid applications are increasingly taking over a month to process. The processing time for new applications is rising.
- Disenrollments are increasing due to paperwork issues. Called “procedural terminations”, this can happen when a state doesn’t have the data available to conduct automatic renewals.
- Call center support is being stretched thin. Enrollees often try to call their state Medicaid call center for assistance when trying to meet renewal requirements. Wait times are increasing in a majority of states, and calls are increasingly being abandoned due to longer call times.
States like Nebraska rolled out their work reporting requirements ahead of the federal deadline. KFF reporting indicated that the state had no plans to increase staffing levels to support with the new work requirement implementation.
State Health and Value Strategies reported on new guidance from CMS that impacts work requirements implementation. CMS has offered a three-part model to guide states in determinations around the medical frailty exemption for work requirements. An ongoing legal challenge that targets this exemption is still pending. State are continuing to prepare for the work requirements to start, despite the fact that the medical frailty rules still have the potential to change ahead of the new year.
Understanding the Basics of Work Requirements
Watch Medicaid Work Requirements and More Frequent Renewals, a webinar recording from Beyond the Basics. This conversation gives a basic review of the work reporting requirements and new renewal frequency changes for 2027. Please note that the medical frailty requirements were confirmed after this webinar, and are not discussed.
Enrollees may need to show their compliance with Medicaid Work Requirements for anywhere from 1-3 months prior to enrollment. People will be asked to demonstrate having completed over 80 hours of work, training, community service, or education each month. Alternatively, people will need to show they’ve earned a minimum of $580 in income each month to comply. As we’ve covered in past newsletters, getting an exemption from these reporting requirements will be a challenge for many disabled people. New “medical frailty” rules will require individuals to complete additional verification steps to prove their inability to work. Research on previous medical frailty tests from Section 1115 waiver programs showed that existing state algorithms under-identified people with disabilities. Please learn more about this and other mandatory and optional exemptions in your state.
Once enrolled, Medicaid recipients will need to complete 6-month renewals, which are conducted at least three months ahead of the actual renewal date. This means that someone might be starting their renewal process within 3 months after their coverage begins.
There is a lot of overlap between Medicaid and SNAP beneficiary populations. Be aware that there are also work requirements in place for SNAP recipients, that have expanded with HR1.