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Medicaid work requirements might spur 5M in coverage losses

Experts say complex documentation requirements might cause those meeting Medicaid work requirement criteria to lose their coverage.

Sara Heath
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Published: 16 Apr 2025

An estimated 5 million adults stand to lose coverage should Medicaid work requirements get enacted, according to a new analysis from the Urban Institute and Robert Wood Johnson Foundation.

In particular, 5 million adults enrolled in Medicaid via Affordable Care Act expansion would likely lose coverage in 2026, the report authors said. This number was calculated by considering how the Limit, Save, Grow Act of 2023 would impact the nearly 13.3 million expansion enrollees ages 19–55 nationwide. The researchers based estimated coverage losses on the trends observed in Arkansas and New Hampshire.

Medicaid work requirements refer to policies mandating Medicaid enrollees to report working at least 80 hours per month or meet exemption criteria, such as being a student, family caregiver or having a disability. Proponents of such policies argue that work requirements promote work and create a path to employment for Medicaid beneficiaries.

Critics point out that many Medicaid enrollees already work low-wage jobs or for small companies with fewer options for employer-sponsored healthcare coverage. Indeed, the Urban Institute report showed that more than 9 in 10 Medicaid expansion enrollees ages 19–55 already work, participate in work-related activities or could meet exemption criteria.

"Work requirements are an ineffective solution to a nonexistent problem. Most adults enrolled in Medicaid are already working, with many balancing two or more jobs to make ends meet," Katherine Hempstead, senior policy adviser at the Robert Wood Johnson Foundation (RWJF), said in a statement.

"Restricting access to Medicaid through work requirements jeopardizes health for millions of people and places a massive burden on states, which would be forced to administer these incredibly complex regulations with increasingly tight budgets and limited staff."

Should Medicaid work requirements be enacted, a total of 5 million adults stand to lose their coverage, with at least 10,000 adults losing their coverage in nearly every expansion state.

Medicaid work requirements impact states differently

Not every state will feel the effects of Medicaid work requirements equally, the report authors noted. Generally speaking, larger or more populous states will see more coverage losses than smaller states.

For example, the researchers estimated that up to 1.2 million adults would lose their Medicaid expansion coverage in California and between 743,000 and 846,000 adults would lose coverage in New York. In Arizona, Illinois, Indiana, Kentucky, Louisiana, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania and Washington, estimates find that more than 100,000 people might lose coverage.

Still, every state that has expanded Medicaid coverage will feel some effect of Medicaid work requirements. In nearly every expansion state, the Urban Institute and RWJF estimate that at least 10,000 adults will lose Medicaid coverage.

Complex documentation to drive disenrollments

As noted above, most Medicaid enrollees currently fulfill Medicaid work requirements by either working, participating in job-related activities or meeting exemption criteria.

Rather, disenrollments are likely to be caused by documentation and paperwork challenges.

"Experiences in Arkansas and New Hampshire indicate that coverage loss under work reporting requirements often results from difficulty navigating state reporting processes, including obtaining exemptions and reporting qualifying activities, rather than a lack of work effort," the researchers wrote.

What's more, these documentation problems could vary across states. While some states might have the capacity to conduct data matching that would automatically exempt enrollees or mark them as compliant, others might lack such infrastructure.

"State coverage losses would also depend on the law’s specifications, what the Centers for Medicare & Medicaid Services (CMS) would allow or prohibit in terms of states’ operational choices, and how much CMS would hold states accountable for maintaining enrollment among people who should be exempt or are meeting the work requirement," the researchers explained.

Medicaid work requirements would likely have more downstream effects on overall health and outcomes, according to Michael Karpman, principal research associate at the Urban Institute.

"Thousands of adults in each Medicaid expansion state could lose coverage under a federal work requirement, nearly all of whom are already working, engaged in work-related activities, or could meet exemption criteria," Karpman said in a press release. "This would result in greater unmet needs for healthcare, rising medical debt, and worse health outcomes."

Sara Heath has reported news related to patient engagement and health equity since 2015.

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