For most of its history, Medicaid had no work requirement. That changes nationally on January 1, 2027. The 2025 budget law known as the One Big Beautiful Bill Act (H.R. 1) requires states to make many working-age adults on Medicaid show that they work, study, volunteer or earn a minimum amount each month to keep their coverage. Some states have already started.
The federal rules are new, a court has already changed part of them, and each state is building its own reporting system. This guide explains the federal framework. Your state Medicaid agency has the final word on how it applies to you.
Who the requirement applies to
The requirement, which the law calls “community engagement,” applies to adults who are:
- aged 19 to 64;
- covered through the Medicaid expansion group created by the Affordable Care Act, or through a similar state waiver program that covers low-income adults; and
- not pregnant and not enrolled in Medicare.
That means it applies in the 40 states plus D.C. that have expanded Medicaid, and in states such as Georgia and Wisconsin that cover some adults through waivers: 43 states and D.C. in all, according to the Centers for Medicare & Medicaid Services (CMS). Children, people 65 and over, and people who get Medicaid because of a disability, pregnancy or as a parent in the traditional (non-expansion) program are outside it. Researchers estimate about 20 million adults are in the affected groups, though many of them will be exempt.
What counts: the 80-hour test
A person meets the requirement for a month if they do any of the following:
- work at least 80 hours;
- do at least 80 hours of community service or volunteering;
- take part in a work program, such as job training, for at least 80 hours;
- are enrolled in school or a training program at least half time;
- do a combination of work, volunteering and training adding up to 80 hours; or
- earn at least the federal minimum wage times 80 hours. At $7.25 an hour that is $580 a month in 2026, even if the person worked fewer hours.
Seasonal workers can have their income averaged over the previous six months instead of being judged month by month.
Looking for a job does not count on its own. Neither does caring for an adult family member unless that person is disabled (see the exemptions below).
Who is exempt
Federal law lists groups who do not have to meet the requirement. States must exempt people who are:
- parents, guardians or caretaker relatives of a child 13 or younger, or caregivers of a person with a disability;
- pregnant, or receiving postpartum coverage;
- “medically frail” (more on this below), including people who are blind or disabled, people with a substance use disorder, a disabling mental disorder, or a physical, intellectual or developmental disability that significantly impairs daily activities, and people with serious or complex medical conditions;
- veterans with a total disability rating;
- American Indians, Alaska Natives and others eligible for Indian Health Service care;
- former foster youth under 26;
- in a drug or alcohol treatment program;
- in jail or prison, or recently released;
- already meeting the work requirements of SNAP (food stamps) or TANF (cash assistance), or in a SNAP household and not exempt from SNAP’s work rules.
States may also grant short-term hardship exceptions for people who are in the hospital or a nursing facility, who live in a county under a federal disaster declaration or with unemployment of 8% or more (or at least 1.5 times the national rate), or who must travel for an extended period for medical care for themselves or a dependent. A state that offers these must offer all of them.
The SNAP rules are similar but not the same. SNAP exempts parents of children under 14 and has its own time limit; see SNAP work requirements explained.
The “medically frail” fight
The exemption for medically frail people matters most in practice, because chronic illness and disability are common among adults on Medicaid. CMS’s interim final rule, issued June 1, 2026, set a two-part test: a person had to have a condition in one of the five statutory categories and show that it significantly impaired their ability to meet the work requirement. CMS said conditions like cancer, kidney failure or multiple sclerosis would generally qualify, while diabetes, asthma or high blood pressure generally would not without added severity.
More than two dozen states, led by Democratic attorneys general, sued in federal court in Massachusetts. On October 29, 2026, Judge Richard Stearns ruled that CMS exceeded its authority by adding the second part of the test. Under the ruling, a person only needs to show they have a condition in one of the five categories listed in the statute. The judge left other parts of the rule in place, including limits on how far back states look at medical claims and on repeated self-reporting of frailty from 2028.
Two caveats. First, reports differ on whether the ruling applies in every state or only in the states that sued, so check with your state agency. Second, the federal government can appeal, and as of early November had not said whether it would. An earlier request by the states to pause the whole rollout was denied in July.
How states will check, and when
States must check compliance:
- When you apply. New applicants must show they met the requirement for one to three consecutive months before applying; each state picks the number.
- At renewal. Enrolled adults must show they met it for at least one month between renewals, and states may check more often. Separately, the same law requires states to renew coverage for expansion adults every six months instead of once a year, starting with renewals after December 31, 2026.
States are supposed to use data they already have, such as wage records, SNAP files and Medicaid claims, before asking people for paperwork. In 2027, if the data don’t settle the question, states may accept a person’s own statement that can be audited later. From 2028, they must ask for documents if documents are reasonably available.
If a state cannot confirm that someone meets the requirement or is exempt, it must send a notice of noncompliance and give the person 30 days to show they comply or qualify for an exemption. If they don’t, the state can deny the application or end coverage. People who lose coverage this way can reapply at any time, and they also cannot get subsidized coverage on the ACA marketplace instead. You keep the right to a fair hearing to challenge a decision.
The timeline
| Date | What happens |
|---|---|
| July 4, 2025 | H.R. 1 signed into law |
| June 1, 2026 | CMS issues its interim final rule |
| 2026 | Some states start early, including Nebraska (May), Montana (July) and Iowa (December); Arkansas began in July with enforcement delayed to January 2027 |
| October 29, 2026 | Federal court strikes the two-part medical frailty test |
| January 1, 2027 | Deadline for all affected states to start |
| Through 2028 | States making a good-faith effort can ask CMS for more time, six months at a time, until December 31, 2028 at the latest |
Georgia has run its own work-requirement program, Georgia Pathways, under a federal waiver since 2023. It is the only state that already had such a rule in place before the 2025 law.
How many people could lose coverage
Estimates vary with the assumptions. CMS projects about 2.3 million people losing Medicaid in 2027 and roughly 3.2 million a year after that, and assumes some of the loss comes from paperwork problems rather than not meeting the requirement. The Congressional Budget Office has estimated the requirement will leave millions more people uninsured within a decade; analysts expected the stricter frailty test to push that number up, so the October ruling may pull it back down.
The best evidence from earlier attempts comes from Arkansas, which ran a work requirement in 2018 before a court stopped it. About 18,000 people lost coverage in a few months. Researchers found no measurable increase in employment; most people who lost coverage were already working or should have been exempt but did not navigate the reporting system.
The arguments
Supporters say Medicaid should focus on people who cannot work, that work and community involvement are good for health and finances, and that most adults covered already work, so the requirement asks little of them. The law’s savings, mostly from fewer people enrolled, help pay for its tax cuts.
Critics say the evidence from Arkansas and Georgia shows the main effect is people losing coverage over paperwork, that people with health problems will fall through the cracks of the exemption system, and that losing coverage can make it harder to keep a job. States also face high costs to build verification systems on a short timeline.
What to do if you are on Medicaid
- Update your contact details with your state Medicaid agency so notices reach you.
- Read every notice and note the 30-day deadline.
- Tell the agency if you think you are exempt, especially for a health condition, caregiving or pregnancy. Ask your doctor for documentation if needed.
- Keep pay stubs, school enrollment records or volunteer logs for each month.
- Ask for a fair hearing if you think a decision is wrong.
For other benefits that use similar rules, see what SNAP is and how it works and what SSI is.