HMA Weekly Roundup

Building State Capacities for Medicaid Work and Community Engagement Requirements

On May 22, 2025, the US House of Representatives advanced a comprehensive legislative package that includes expansive changes to healthcare spending and tax policies. The One Big Beautiful Bill Act, H.R. 1, will be subject to further revision in the Senate – and potentially again in the House – before it can be sent to the president for his signature. If enacted, the legislation would have significant implications for the Medicaid program, including a nationwide work and community engagement requirement. The House-passed bill establishes a deadline of December 31, 2026, for implementation, but individual states could move earlier.

As state legislatures pass work requirement bills, governors consider executive actions, and Congress contemplates revisions to the Medicaid work mandate, vetting key implementation issues may significantly affect the direction of related policies. Even before implementation, states must test operations, enable systems, and establish connections to beneficiaries to reduce potential implementation missteps, inappropriate disenrollments, and litigation risks.

If the goal of Medicaid work requirement policies is to stimulate connections between health benefits and employment/workforce, building state and federal capacities to support these approaches is critical to effectuating that change. In the remainder of this article, Health Management Associates (HMA), experts focus on the operational dynamics that need to be discussed, tested, and built as states begin introducing work and community engagement initiatives.

Federal Policies and Early State Actions on Work Requirements

The House bill would require all states to implement work and community engagement requirements for adults without dependents for at least 80 hours per month.[1] Employment, work programs, education, or community service (or a combination of those activities) would satisfy the requirement.

The work requirements in the House-passed legislation would apply only to individuals between the ages of 19 and 64 without dependents, and the following groups are exempted:

• Women who are pregnant or entitled to postpartum medical assistance
• Members of Tribes
• Individuals who are medically frail (i.e., people who are blind, disabled, with chronic substance use disorder, has serious or complex medical conditions, or others as approved by the Secretary of the US Department of Health and Human Services)
• Parents of dependent children or family caregivers to individuals with disabilities
• Veterans
• People who are participating in a drug or alcoholic treatment and rehabilitation program
• Individuals who are incarcerated or have been released from incarceration in the past 90 days

In addition, individuals who already meet work requirements through other programs, such as Temporary Assistance for Needy Families (TANF) or the Supplemental Nutrition Assistance Program (SNAP), would be exempt. However, the House-passed version would make the eligibility verification and work requirements for SNAP more stringent and shift program costs to these states, which would affect cross-functional eligibility. The legislation also includes temporary hardship waivers for natural disasters and areas with an unemployment rate greater than 8 percent (150 percent of the national average).

Though the federal budget package has received a great deal of attention, at least 14 states already have moved forward (see Table 1) in advance of the current federal debate by passing laws and submitting work requirement demonstration requests to the Centers for Medicare & Medicaid Services (CMS).

Table 1. A Review of 2025 States’ Approaches to Work Requirements in Medicaid

Key Questions to Guide State Policy Decisions

Considerable research and findings from previous Medicaid work requirement initiatives can help prepare policymakers to implement a potential new phase of Medicaid work requirement policies. Some previous findings include the high cost of administration relative to potential savings, the importance of systems that support foundational items like logging an enrollee’s compliance activities and exemptions, as well as developing an efficient appeals process. The Medicaid and CHIP Payment and Access Commission (MACPAC), General Accounting Office, National Institutes for Health, and multiple researchers have published assessments regarding previous experiences that could prove useful in policy making.

HMA experts have experience identifying key issues and considerations, analyzing options, and implementing critical issues and for state leaders and stakeholders who will be responsible for implementing work requirements. Several of these issues are described below and in more detail in the HMA blog, Building State Capacities for Medicaid Work and Community Engagement Requirements.

• Exemptions, particularly medical frailty definitions and assessments. The federal government and states will need to identify individuals classified as “medically frail” and make them exempt from the mandates. Medically frail individuals include those with chronic, serious, or complex medical conditions. Various methods can be employed to identify these people.
• Developing and streamlining systems and processes to promote continued coverage for eligible individuals. The Medicaid unwinding from the COVID public health emergency taught policymakers lessons about the complexities of Medicaid systems, patient engagement, and reliable methods of member outreach. State Workforce Commissions and Departments of Labor are clear partners, as they manage integrated eligibility systems and data-sharing agreements across programs like SNAP and TANF, which also serve many Medicaid participants. These and other partnerships will need further exploration.
• Clinical and utilization data that promote eligibility assessment. Many, but not all, individuals with chronic diseases may be exempt from the requirements. Knowing the health status and chronic conditions of the populations affected and the conditions that qualify people for exemption are variables as implementation questions, like the definition of medically frail, are addressed.
• Anticipated need for effective Medicaid managed care engagement in work requirements/community engagement initiatives. Approximately 80 percent of Medicaid expansion enrollees are members of comprehensive managed care organizations (MCOs). States will need to review the scope of existing vendor contracts as well as determine the need for new services, roles, third-party reporting, oversight, and potential exemptions for emergencies. Work requirements can disrupt MCO risk pool stability and care coordination. MCOs have a financial incentive to drive down inappropriate disenrollments and are uniquely positioned to support state responsibilities, including maintenance of up-to-date contact information.
• Measuring impact and adapting policies as needed. Dynamic metrics that provide actionable information to federal and state policy makers will support effective oversight and monitoring.

Connect with Us

HMA helps stakeholders—including state agencies and their partners—manage the challenges of implementing new Medicaid or CHIP initiatives, with a focus on ensuring efficient integration and improvements in outcomes. Our teams are adept at developing materials for and supporting stakeholder engagement from design to implementation, which is a critical aspect for work and community engagement initiatives and other potential new eligibility and renewal requirements.

For support tracking federal and state level developments and enhancing your organization’s strategy and preparations for new Medicaid requirements, contact our featured experts Loren Anthes and Matt Powers.

[1] U.S. Congress. House. One Big Beautiful Bill Act. H.R.1. 119th Cong., 1st sess. Introduced May 20, 2025. https://www.congress.gov/bill/119th-congress/house-bill/1/text.

HMA Experts in Action: Doug Shoemaker Appointed to Housing Authority of the City and County of San Francisco

On May 21, 2025, Health Management Associates (HMA), Principal Doug Shoemaker was appointed to the Board of Commissioners for the Housing Authority of the City and County of San Francisco by Mayor Daniel Lurie. Mr. Shoemakers will bring his extensive experience in affordable housing, community development, and the intersection of health and housing to advance the Housing Authority’s mission.

A recognized leader in the affordable housing field, Mr. Shoemaker has worked at the intersection of housing, community development, and healthcare to advance projects and policies that improve outcomes for lower-income individuals and communities. At HMA, Mr. Shoemaker has leveraged his expertise in housing development, financing, operations, and policy to create effective partnerships and community-based programs that address homelessness, senior living, and other complex challenges.

“Doug Shoemaker brings unmatched experience and a lifelong commitment to affordable housing and the families who benefit from it to the Housing Authority. I look forward to working with him to ensure the next generation of San Franciscans can afford to raise their kids here,” said Mayor Lurie.

The Authority’s primary programs are its Housing Choice Voucher and Public Housing programs, serving over 15,000 residents in all neighborhoods and districts within San Francisco. In recent years, the Authority has focused on leased housing through the federal US Department of Housing and Urban Development program called Rental Assistance Demonstration, which allows for the transfer of public housing unit property management to third-party management companies while the Authority retains land ownership.

Mr. Shoemaker previously served as president of Mercy Housing California, California’s largest nonprofit affordable housing developer. In this role, he oversaw the completion of more than 6,000 affordable homes and led a 3,500-unit development pipeline across major California markets including the Bay Area, Los Angeles, and Sacramento. Mr. Shoemaker successfully led a $45 million capital campaign for a new community center and gym and launched a $47 million land acquisition fund.