CMS Issues New State Guidance To Implement Mandatory Medicaid Eligibility Requirements

Earlier this week, the Centers for Medicare & Medicaid Services (CMS) issued new guidance outlining how states should implement additional Medicaid eligibility requirements established by H.R.1, which CMS refers to as the “Working Families Tax Cut” (WFTC) legislation.  The guidance reiterates that states must implement the “community engagement” requirements — and develop a documentation process for recording and storing the data — no later than January 1, 2027, unless granted a “good-faith-effort” extension of two years.

CMS cited a framework of four principles that would shape policy development: centering the connection between health and communities; balancing state flexibility with potential costs; aligning policies with existing requirements; and ensuring easy auditability of state community engagement determinations and verifications.  CMS also announced that the federal government will award states federal funding to help them establish the systems necessary to carry out these measures.  The agency will distribute a total of $200 million in fiscal year 2026, divided among all 50 states and the District of Columbia.

To remain eligible for Medicaid, H.R.1 mandates adults aged 19-64 to prove they either have a monthly income of $580 (80 times the federal hourly minimum wage) or are engaged in at least 80 hours per month of work, which may include a job, community service, volunteering, or education.  The law eliminates key exemptions for veterans, those experiencing homelessness, and those under 24 who aged out of foster care at 18.

These changes impact the Medicaid expansion population (HUSKY D) — approximately 315,000 of the nearly 950,000 people on Medicaid in Connecticut.  State officials estimate 100,000-200,000 beneficiaries could lose Medicaid coverage over the next 10 years due to these work requirements.

The Connecticut Hospital Association (CHA) continues to engage with the Connecticut Department of Social Services (DSS) and Access Health CT on coordinating opportunities to mitigate the mandate’s impact on enrollment.