Overview
- CMS told state Medicaid directors on Friday that states may delay terminating beneficiaries for failing the new 80-hours-per-month community engagement rule until July 1, 2027 while still beginning verification work on Jan. 1, 2027.
- The statutory work requirement remains scheduled to take effect Jan. 1, 2027 and will apply mainly to nonelderly adults in Medicaid expansion programs who must work, volunteer, or attend school about 80 hours each month.
- A federal judge in Boston found CMS’s medical-frailty regulation overly onerous, leaving the key exemption standard unsettled and creating legal and operational uncertainty for states and beneficiaries.
- Early rollouts, notably Nebraska’s May start, show many denials came from paperwork and verification failures rather than lack of work, and the Congressional Budget Office previously estimated the policy could raise the uninsured by roughly 5.3 million by 2034.
- States are split on using the optional pause with Arkansas saying it will enforce the requirement on Jan. 1, and the delay handing some governors and Congress time to refine systems and consider policy changes before removals begin.