Medicaid Work Rules Are Coming — and States Warn They Don’t Have Enough Staff to Enforce Them

Washington, D.C. — When congressional Republicans passed the One Big Beautiful Bill Act last summer, they handed states a massive new job: verify whether millions of Medicaid enrollees are actually working. The problem is, many states say they don’t have nearly enough people to do it.

A new report from KFF Health News, drawing on interviews with state agencies across the country, finds that Medicaid offices are already stretched thin — and the incoming wave of work rule requirements is about to make things significantly worse.

Under the new law, states will have to verify whether enrollees meet work requirements and check eligibility every six months instead of once a year. That doubles the administrative load at the exact moment states are reporting hundreds of open positions and phone wait times that stretch to three hours in some places.

A System Already Under Strain

The numbers tell a discouraging story. Idaho has 40 eligibility worker vacancies. Pennsylvania has nearly 400 open positions in county human services offices. Indiana’s Medicaid agency has 94 unfilled roles. New York estimates it needs 80 new employees just to handle the extra administrative work — at a cost of $6.2 million.

Maine and Massachusetts each want to hire roughly 70 to 90 additional staffers. Montana, which plans to roll out work rules as early as July 1, had only filled 39 of the 59 positions it projected it would need.

“States are already struggling significantly,” said Jennifer Wagner, director of Medicaid eligibility and enrollment at the Center on Budget and Policy Priorities. “There will be significant additional challenges caused by these changes.”

Some states called on the phone are even worse off. Hawaii enrollees waited more than three hours on hold in December. Oklahoma hit nearly an hour. The Congressional Budget Office has estimated the new rules will cause more people to lose health coverage than any other piece of the GOP budget law — more than 5 million people by 2034.

What This Means for Nursing Homes

For nursing facilities, the stakes are direct. Medicaid covers more than 60 percent of nursing home residents nationwide — and any erosion in that enrollment base can translate quickly into lost revenue and empty beds.

Work requirements don’t apply to elderly or disabled residents who live in nursing homes. But they do apply to the broader Medicaid population, including many working-age adults who support family members in care. Researchers have warned that coverage losses under the new work requirements could ultimately push vulnerable seniors into nursing homes sooner — without the Medicaid funding to pay for them.

The eligibility verification crunch also affects nursing home residents directly. If a long-term care resident’s Medicaid renewal is delayed or lost in a backlogged agency, the facility has to decide whether to keep them while waiting on payment — or pursue an eviction proceeding.

A Bigger Challenge Than the Pandemic Unwinding

Many policy experts are pointing to the 2023 Medicaid unwinding — when more than 25 million people lost coverage as states re-verified eligibility after the pandemic — as a preview of what’s coming. But they say this time will be harder.

“It is a much larger scale of administrative complexity,” said Sophia Tripoli, senior director of policy at Families USA. The work rules require IT system overhauls, new training, and ongoing transaction-by-transaction verification — all on a tight federal deadline.

Government contractors are already circling. Maximus, which runs Medicaid call centers in 17 states and interacts with nearly 3 in 5 program enrollees nationwide, told investors in February it expects revenue to keep growing — even as Medicaid enrollment shrinks — because the volume of transactions per person will go up.

In other words, more churn means more billable work, whether or not people actually get help.

The work rules are set to take effect January 1, 2027, in most states. How well state agencies staff up — or fail to — in the months ahead will shape how many people lose coverage, and how much of that loss falls on facilities already operating on thin margins.