The changes stem from the One Big Beautiful Bill Act, signed into law in July 2025. The legislation requires states to introduce new work requirements for many Medicaid expansion recipients and to conduct eligibility reviews every six months, replacing the annual process that has generally been used.
The projected effects are expected to vary widely among states, reflecting differences in population size as well as how each state verifies work activities and exemption eligibility. According to the Urban Institute, implementation choices and administrative practices will play a significant role in determining the final impact.
New Federal Rules Introduce Work Requirements and More Frequent Eligibility Reviews
The One Big Beautiful Bill Act requires most adults enrolled through Medicaid expansion in the 41 participating states to complete at least 80 hours of approved activities each month beginning in 2027. Eligible activities include paid employment, community service, approved job training programs, and part-time participation in educational programs. Recipients may also combine different activities to satisfy the monthly requirement.
The law applies primarily to Medicaid expansion recipients between the ages of 19 and 64 who are not eligible for or enrolled in Medicare. It also establishes several exemptions, including for pregnant people, former foster youth, American Indians and Alaska Natives, totally disabled veterans, people participating in substance use treatment programs, parents or caregivers of children aged 13 or younger, caregivers for individuals with disabilities, medically frail individuals, and certain recipients already subject to work requirements through other public assistance programs.
States must also reassess Medicaid expansion eligibility every six months rather than once each year. According to the Urban Institute, those more frequent redeterminations alone could reduce average monthly Medicaid expansion enrollment before accounting for the additional effects of work requirements. Federal law directs states to rely on existing government data systems whenever possible to verify compliance and exemptions without requiring additional documentation from recipients.
State Projections Vary as Administrative Challenges Remain a Concern
According to the Urban Institute‘s medium implementation scenario, California is projected to experience the largest numerical reduction in average monthly Medicaid expansion enrollment in 2028, followed by New York. Other states with comparatively large projected declines include Illinois, Michigan, Ohio, Pennsylvania, Virginia, Washington, North Carolina, and New Jersey.
When measured as a share of Medicaid expansion enrollment rather than total numbers, Massachusetts is projected to experience the largest percentage decline. Connecticut, Maryland, Vermont, and Minnesota are also projected to see relatively large proportional reductions, while North Dakota, Oregon, South Dakota, Indiana, and Nebraska are projected to have the smallest percentage declines under the same scenario.
The Urban Institute also noted that some people who satisfy the work requirements or qualify for exemptions could still lose coverage because of administrative barriers. Challenges may arise when recipients have irregular work schedules, are self-employed, or must document medical conditions or caregiving responsibilities. Previous state experiences with Medicaid work requirements found that data matching helped reduce unnecessary coverage losses, although the report states that administrative obstacles are still expected to leave some eligible individuals without insurance.
Newsweek reported that Republicans have defended the new requirements as a way to encourage employment while preserving Medicaid resources for vulnerable recipients. The Urban Institute, meanwhile, identified self-employed workers, students, adults between ages 50 and 64, caregivers for disabled family members, and people with health conditions affecting their ability to work among the groups facing a greater risk of losing coverage despite remaining eligible.
