Millions Could Be Exempt from Medicaid Work Requirement
Starting January 2027, a federal law under President Donald Trump will require many adult, nondisabled Medicaid enrollees in 42 states and Washington, D.C., to work, volunteer, or attend school for 80 hours per month. However, Medicaid recipients living in counties with high unemployment may qualify for exemptions, offering relief to those struggling to find jobs.
How the High-Unemployment Exemption Works
The law allows exemptions for residents in counties where unemployment is either:
- At least 8%, or
- 1.5 times the national unemployment rate
States must apply for the exemption on behalf of eligible residents. If approved, enrollees in these counties could be shielded from the work requirement entirely.
Who Could Qualify?
According to a recent analysis:
| Exemption Standard | Potential Number of Enrollees | Number of Counties | Percentage of Total Enrollees |
|---|---|---|---|
| One-month unemployment threshold | 4.6 million | 386 | ~25% |
| 12-month average unemployment threshold | 1.4 million | 158 | ~7% |
Most of the exemptions under the stricter 12-month standard are concentrated in California, New York, Michigan, Kentucky, and Ohio, with California alone accounting for over half of eligible enrollees.
Other Exemptions in the Law
Besides the high-unemployment carve-out, the Medicaid law also exempts:
- Parents with children under 14
- People who are disabled or frail
- Pregnant women
- Incarcerated individuals
- Participants in substance use disorder programs
The high-unemployment exemption is unique because it applies to entire counties rather than individuals.
Challenges in Implementation
Even if the federal government approves exemptions, some states may choose not to apply, similar to past SNAP exemptions. Advocates warn that red tape could prevent eligible residents from actually receiving exemptions, despite living in qualifying counties.
Medicaid work requirements have historically caused coverage losses and administrative challenges. For example, Arkansas saw nearly a quarter of its ACA-expanded Medicaid enrollees lose coverage under a previous work requirement program before a court ended it.
Key Takeaways
- Only states that expanded Medicaid under the ACA or via special federal waivers are subject to the work requirement.
- High-unemployment exemptions could protect over a million Medicaid enrollees from losing coverage.
- The law’s reporting requirements may still create bureaucratic hurdles for some enrollees.
- The actual impact depends heavily on whether states seek exemptions for qualifying counties.
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