By Shalina Chatlani, Stateline.org
States must begin verifying millions of Medicaid enrollees’ monthly work status by the end of next year — a task some critics say states will have a hard time carrying out.
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A provision in the tax and spending bill President Donald Trump signed into law July 4 will require the 40 states plus Washington, D.C., that have expanded Medicaid to check paperwork at least twice a year to ensure those enrollees are volunteering or working at least 80 hours a month or attending school at least half time.
The new law provides states $200 million for fiscal year 2026 to get their systems up and running. But some experts say states will have difficulty meeting the deadline with that funding and worry enrollees might lose their health benefits as a result.
A year and a half to comply is likely not going to be enough time for most states, especially since the federal government must craft guidance on how they should implement their programs, said Dr. Benjamin Sommers, a health economist at Harvard T.H. Chan School of Public Health. He predicted it will be difficult to create technology simple enough — such as a phone app — to streamline the process for all enrollees.
“Two hundred million [dollars] is not going to cover the 40 expansion states that we have,” he told Stateline. “There is not a silver bullet here, and there isn’t a single app out there that’s going to keep people who should be in Medicaid from losing coverage. That’s just not realistic.”
A spokesperson for the North Carolina Department of Health and Human Services, Hannah Jones, told Stateline that “it will take a significant amount of time and investment in order to implement work requirements.”
Jones said an estimated 255,000 people in North Carolina could lose coverage because of these requirements and their “administrative burden.”
“More automation reduces manual work on beneficiaries and eligibility case workers, but it requires more time, funding, and staff resources to implement,” Jones wrote in an email.
Emma Herrock, a spokesperson for the Louisiana Department of Health, wrote in an email that the vast majority of the state’s Medicaid enrollees already work, and the agency expects few people to be disenrolled. Herrock said the department will establish work verification systems by the end of 2026.
“The department is taking a thoughtful approach to implementation,” Herrock wrote. “We are already working with several Louisiana agencies … in order to receive data on recipients who are working.”
She added that the department views work requirements “as a means to grow our economy, while reinforcing the value of work and self-sufficiency.”
In New York, it could cost the state $500 million to administer the new requirements, New York Department of Health spokesperson Danielle De Souza wrote in an email.
Between 600,000 and 1.1 million individuals who are eligible for and enrolled in Medicaid could potentially lose coverage because of work reporting requirements, she wrote, based on what happened when states were required to resume checking eligibility after the COVID-19 health emergency ended.
“The department will remain steadfast in its commitment to protecting the health of all New Yorkers and will work to mitigate the impacts of this law,” De Souza wrote.
The new rules apply to states that expanded Medicaid to adults between the ages of 19 and 64 with incomes below 138% of the federal poverty line (about $22,000 for an individual), an option that was made available under the 2010 Affordable Care Act. More than 20 million people were enrolled through Medicaid expansion as of June 2024 — those are the patients who will face work requirements.
Reapplying for Medicaid, which typically has been required once a year, already is burdensome for some patients, said Dr. Bobby Mukkamala, president of the American Medical Association.
“On top of that, now we’re going to be challenging so many people who were at least able to deal with it financially with things like … proving that they got a job,” Mukkamala said in an interview.
Previous attempts at implementing work requirements have ended up costing states millions in administrative and consulting fees. And in some cases, people who were eligible for Medicaid lost their coverage due to paperwork issues.
Arkansas’ example
Several states wanted to implement work requirements during the first Trump administration. But only Arkansas fully did so, in 2018, before a federal judge halted the requirements. More than 18,000 Arkansas residents lost Medicaid coverage during the 10 months the requirements were in effect.
Sommers, of Harvard, noted that most people were disenrolled because they didn’t know about the policy or made paperwork errors, not because they weren’t working.
“Red tape led to people losing their coverage,” he said. “They had more trouble affording their medications. They were putting off needed care.”
Brian Blase, president of the Paragon Health Institute, a conservative policy group that advises congressional Republicans, said he thinks concerns about the new requirements are overblown because there’s more advanced technology now.
“Lots of government programs have initial implementation challenges,” Blase told Stateline. “Arkansas was seven years ago, and if you just think about the change in the technological advancements over the past seven years … we didn’t have artificial intelligence and just the ability of modern tech.”
As it stands, each state has varying technological capabilities, and will have a different timeline and budget, said Michael Heifetz, a managing director at consulting firm Alvarez & Marsal and a former Medicaid director in Wisconsin. His team contracts with states to implement Medicaid, including work requirements, and other programs.
He also noted that the Trump administration can give states a deadline extension on implementing work requirements to Dec. 31, 2028, if they show they are making a “good faith effort.” States will need to share data across agencies in new ways, he said.
“It will require some form of data sharing and communications with educational agencies, workforce training agencies and some other agencies that typically aren’t in the Medicaid ecosystem,” Heifetz said.
State governments may resist hiring full-time positions for those tasks, he said, but “artificial intelligence and other tools can help work through these processes in a smoother fashion.”
Other state efforts
Efforts in other states to implement work requirements have had mixed results.
In Georgia, for example, an experimental work requirement program cost taxpayers more than $86 million in its first 18 months but enrolled just 6,500 people during that time, according to an investigation by ProPublica and The Current published in February. That’s 75% fewer participants than the state had estimated for the program’s first year.
The nonpartisan U.S. Government Accountability Office in 2019 looked at five states that tested systems to track Medicaid work requirements under the first Trump administration. Those demonstration projects were rescinded during the Biden administration.
The states estimated their projected administrative costs for implementing work requirements for one to three years, and the total far surpassed the $200 million Congress has provided in the new law. Kentucky alone estimated $270 million, Wisconsin $70 million, Indiana $35 million, Arkansas $26 million and New Hampshire $6 million.
Susan Barnidge, an assistant director on the GAO health care team and an author of the report, said the agency found that across states there wasn’t much federal oversight of administrative costs on test programs. Oversight will be key as states roll out their work requirement systems, she said.
“We found some weaknesses in [federal] Centers for Medicare & Medicaid oversight of certain federal funding for certain administrative activities. So we found examples of things that states sought federal funding for that didn’t appear to be allowable,” Barnidge said in an interview. “I think that will remain relevant.”
Mukkamala, of the American Medical Association, said the burden will in some ways fall to doctors’ offices to help keep patients enrolled, as they work with patients to check eligibility and possibly help get them on Medicaid. He works in Flint, Michigan, as an otolaryngologist, or ear, nose and throat doctor, and said a third of his patients are on Medicaid.
“As if it’s easy to take care of their health care issue, given things like prior authorization,” Mukkamala told Stateline. “Now to add to the challenge, we have to figure out how to get them covered.”
Stateline reporter Shalina Chatlani can be reached at schatlani@stateline.org.
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