Considerations for Implementation of Medicaid Community Engagement Requirements: Lessons from Five States

Abstract

The One Big Beautiful Bill Act, or HR 1, made major changes to Medicaid and is expected to reduce federal funding to state Medicaid agencies by more than $900 billion over the next 10 years. An estimated $350 billion (39%) of this reduction is a result of community engagement requirements (also known as work requirements) for the Medicaid expansion population, which are also forecasted to lead to loss of health insurance for more than 5.3 million adults. However, states have an opportunity to substantially mitigate the budgetary impact and coverage loss associated with community engagement requirements. To heighten awareness among state legislators and other stakeholders of the key decisions executive branch leaders face, this brief draws on lessons from previous initiatives in Arkansas, Georgia, Louisiana, and Montana, and the early rollout of the HR 1 community engagement requirements in Nebraska. These lessons include digital verification of compliance or exemptions, when possible; robust outreach and education for enrollees; and employment assistance.

Introduction

In July 2025, President Trump signed into law the One Big Beautiful Bill Act, also known as HR 1. A recent study by RAND Health of HR 1’s impact on state budgets estimated that the largest effects on total state budgets come from community engagement requirements, at more than $350 billion.¹ Under community engagement requirement, Medicaid enrollees covered through the ACA Medicaid expansion must verify at least 80 hours per month of community engagement, consisting of work or other qualifying activities, unless they quality for an exemption. The Congressional Budget Office estimates that more than 26% (5.3 million people) of the Medicaid expansion population will lose Medicaid because of the new requirements, although the impact will vary by state based on Medicaid expansion status.²

States have an opportunity to substantially mitigate the budgetary impact and insurance coverage loss associated with community engagement requirements. Program complexity as well as communication and administrative barriers, rather than ineligibility, are expected to be the most significant, but preventable, drivers of insurance coverage loss (Figure 1). One study suggests that more than 90% of current Medicaid enrollees should continue to qualify for Medicaid even with community engagement requirements, but implementation will play a key role.³

Figure 1. State Implementation Decisions Can Mitigate Harm of Medicaid Community Engagement Requirements

Source: Center on Budget and Policy Priorities. “Medicaid Work Requirements Will Take Away Coverage from Millions.” https://www.cbpp.org/media/state-implementation-decisions-can-mitigate-harm-of-medicaid-community-engagement. Reprinted with permission.

 As states move quickly to interpret and implement guidance from the June 1, 2026, Centers for Medicare and Medicaid Services (CMS) Interim Final Rule,⁴ they are also learning from peers that are a few implementation steps ahead, as well as from states that have implemented community engagement requirements in past years.

This brief describes the requirements, approaches to streamlining eligibility, and lessons learned from states , including from previous initiatives in Louisiana, Arkansas, Georgia, and Montana, and the early rollout of the HR 1 requirements in Nebraska, highlighting opportunities for states to minimize both coverage loss and state budget impact.

Overview of Community Engagement Requirements

Exemptions and Qualifying Activities

HR 1 requires expansion enrollees to document at least 80 hours per month of community engagement, consisting of work or other qualifying activities, or qualify for an exemption, to receive Medicaid coverage. Key qualifying activities and exemptions are described in this section, and other resources provide further detail.⁵ 

* The interpretation of HR 1 that requires that medical frailty exemptions include a demonstrated impairment to work capacity is under litigation. Twenty-six states have sued CMS claiming that the interpretation was a sharp departure from previous guidance that indicated states would be able to exempt people with qualifying medical conditions without individual assessment. See Tolbert J. States sue CMS over Medicaid work requirements rule, citing departure from earlier guidance on medical frailty. KFF. June 30, 2026. Accessed July 6, 2026. https://www.kff.org/quick-insights/states-sue-cms-over-medicaid-work-requirements-rule-citing-departure-from-earlier-guidance-on-medical-frailty/.

Timeline

Community engagement requirements for Medicaid need to be fully implemented by January 1, 2027, though some states, like Nebraska, have chosen to begin their implementation earlier.

Streamlining Eligibility

Preserving coverage for those who are working will require, in large part, minimizing the number of manual steps that enrollees and program staff need to take and automating as much of the process as feasible. Approaches to streamlining the employment verification process include leveraging data matching using other state sources; setting up consent-based verification of income with external sources; and developing user-friendly online eligibility portals.

Data Matching

Although states note significant barriers of interoperability, legal limitations, and cost to implement data linkages, states are still prioritizing access to several data sources that can be used to verify income, student status, veteran status, and other qualifying exemptions without direct input from program participants.⁶ Table 1 provides an overview of data sources that states are using for this process.

Table 1. State Sources with Data on Qualifying Activities or Exemptions

Consent-Based Verification

Even with state data matching, gaps will exist in the employment verification process, such as for seasonal or gig workers. To meet this challenge, states are incorporating consent-based verification (CBV) processes. Through CBV, an applicant or enrollee voluntarily authorizes the state Medicaid agency to have one-time data connection to a payroll provider, gig platform, digital wallet, or digital bank account. Once authorized, the Medicaid agency can use this connection to generate a one-month report that can be used to verify Medicaid eligibility by income or employment history. CMS is helping states meet new community engagement requirements through CBV in a number of ways:

• Software: CMS has developed an open-source software called Eligibility Made Easy (Emmy). The software includes a mobile-responsive interface and an application programming interface, or API, that allows states to securely access relevant data sources.
• Technical Assistance: Whether or not a state adopts Emmy software, CMS will offer hands-on support across planning, implementation, and optimization. This assistance includes:
  • Supporting vendor coordination, onboarding, and communicationsStreamlining system integrations to reduce case management burden
  • Preparing program documentation to meet compliance requirements

User-Friendly Eligibility Portals

Some individuals will not be able to be automatically enrolled or renewed with data matching or CBV. These enrollees will need to submit applications to the state’s Medicaid agency. Some steps states can take to make the process as user-friendly as possible include:

• Building mobile-first application portals: Nearly 30% of low-income households rely exclusively on smartphones for internet access, so enabling applicants to complete all steps of the application through their phones is essential.⁷
• Allowing photo submission of documents: As a complement to designing mobile-first application portals, states can allow individuals to submit documents (or photos of documents) directly from their phone.
• Translating notices and forms into multiple languages: Millions of Medicaid expansion enrollees do not use English as their primary language.⁸ Translating documents into other languages commonly spoken by residents can help these individuals comply with the mandate and access necessary documents.
• Asking only what is needed to determine eligibility: Questionnaires that collect the same information multiple times or ask for information not necessary for eligibility checks could lead to extended application completion times, additional burden for caseworkers, and failed verifications. Agencies can reduce this burden by auditing the application to identify nonessential or duplicative questions.⁹

Lessons from Experienced States

Arkansas: Outreach Must Be Targeted and Supported

In preparation for HR 1, states were required to conduct initial outreach between June 30 and August 31, 2026, to impacted Medicaid enrollees to inform them of the relevant changes to the Medicaid law.⁵ This included information on community engagement requirements compliance, an explanation of exemptions, consequences of noncompliance, and reporting instructions. Evidence from Arkansas’s outreach experience can inform other states’ efforts to reach their most vulnerable individuals.

In June 2018, Arkansas implemented Medicaid community engagement requirements that were similar (though not identical) to those imposed by HR 1. Even though the state reached out to affected enrollees by telephone, email, and mail, by the end of the year, more than 18,000 people had been disenrolled from Medicaid and the employment rate had not improved.¹⁰ A report by the Arkansas Center for Health Improvement found that the outreach and verification processes were insufficient. Not only did the state have trouble contacting enrollees, but many of the enrollees who were aware of the requirement were confused about what was expected of them or unable to verify compliance. Initially, enrollees whose status could not be verified with existing government data were required to verify compliance through an online portal, even though almost one-quarter of households in the state lacked internet access. By March 2019, a federal judge ruled that the community engagement requirement did not promote the objectives of the Medicaid program, and the requirement was subsequently halted. According to the Arkansas Center for Health Improvement researchers, Arkansas’s experience shows that implementation of Medicaid community engagement requirements must include clear and simple communications with affected enrollees, use of multiple communication channels, and adequate time and support to assess enrollee employment verification systems.

Louisiana: Use Digital Consent-Based Verification Systems to Verify Income

Louisiana has been a leader in using CBV for the state’s Medicaid program. Though community engagement requirements have not yet been implemented, Louisiana has been working with CMS and using Emmy software to verify enrollee income for Medicaid eligibility. The state can expand this capability to verify a maximum income for Medicaid eligibility and that an individual is meeting the $580 per month minimum for community engagement requirements.

Louisiana’s best practices include:

• Customized identification tokens for links: When sending online links through the Emmy portal, it is important to use custom links for each enrollee. Enrollees often copy and paste the link they received from the government and send it to friends and family who are on Medicaid. While this is good for spreading awareness, it can lead to problems if multiple users try to use the portal from the same generic link.
• Embedding Emmy into existing portals: To minimize confusion, the Emmy software has been integrated into the state’s digital infrastructure. It is embedded into the state’s Medicaid portal and included by name in the state’s work requirements communications toolkit and outreach materials for stakeholders like health care providers and community-based organization that may be assisting people with enrollment.
• Ongoing consent requests: To mitigate the risk of data leaks, Louisiana’s use of CBV relies on one-time access. The state requests access to an enrollee’s payroll, uses that information to verify eligibility, and then immediately deletes it. No payroll information is saved by the state. Therefore, the state continually requests consent from beneficiaries each time it needs to verify their status.

Georgia: Clear Communication Can Prevent or Remedy Submission Errors

Georgia received approval to implement community engagement requirements into its Medicaid program—known as Georgia Pathways to Coverage—starting in 2020, but due to several legal and administrative challenges, the state was not able to complete its initial demonstration until 2025. In that time, state administrators had learned several lessons about the application process, namely, how to remedy the expected errors that come with submitting paperwork. (Figure 2).

Figure 2: Timeline of Selected Events During Approval and Implementation of Georgia Medicaid Demonstration Work Requirements

Source: Geo analysis of Centers for Medicare & Medicaid Services documentation. GEO-25-108 160. Reprinted with permission.

Initially, the Georgia Pathways to Coverage program struggled with enrollment. In the October 2020 approval letter, it was estimated that the program would cover about 31,000 Georgians in the first year and 64,000 Georgians at full enrollment.¹¹ By June 2025, only 8,078 Georgians were actively enrolled in the program, 12% of the target. A frequently reported problem was that, in addition to confusing instructions on the online portal, applicants who submitted documents were repeatedly denied coverage or told they submitted the wrong documents without further explanation. When attempting to remedy their applications, these applicants had difficulty reaching anyone who could explain what was wrong with the paperwork or how to fix it.¹²

To improve the process, Georgia rolled out a “refresh” to the Gateway Customer Portal that included easier navigation and training videos for users as well as built-in prompts to ask customers to upload required documents.¹² After this refresh, as of July 2026, more than 19,000 Georgians were enrolled in the program, an increase of more than 130% in about a year.

Lessons learned for states include preemptively explaining how to comply with requirements in the portal itself and having clear instructions on how to fix errors in paperwork. These instructions should anticipate common errors in submission, and internal and external support staff who will communicate with potential applicants should be trained to answer these types of questions. This additional personnel and tech support are costly but essential for launch success.

Montana: Job-Assistance Programs Increase Employment and Compliance

Though outreach alone has not been demonstrated to improve community engagement requirements compliance or employment outcomes in states such as Arkansas or New Hampshire where earlier attempts at work requirements have been made,^10,13 evidence from an initiative in Montana suggests that job-assistance programs for Medicaid enrollees can be effective. In 2016, as part of a CMS 1115 expansion demonstration, the state launched a free voluntary workforce support program for Medicaid expansion adults called the Health and Economic Livelihood Partnership Link (HELP-Link).¹⁴ HELP-Link includes services such as career planning, workforce and educational training, work-based learning, supportive services (e.g., financial assistance for specific barriers), and referrals to other service providers (such as transportation or child care). Montana uses state funds to support the program.

A 2019 study by the University of Montana found an increase of 4 to 6 percentage points in labor force participation among low-income, nondisabled adults ages 18-64 after Medicaid expansion with HELP-Link in Montana, relative to the same population in other states in the same time period.¹⁵ The adults studied in this research met the same criteria as required for Medicaid expansion. In other words, the study found that the target Medicaid expansion population experienced an increase in employment relative to others states. This suggests that a job-assistance program like HELP-Link may be effective in helping Medicaid expansion enrollees find work.

Nebraska: Criteria Should Be Evaluated Early and Continuously

By benchmarking criteria and infrastructure early in community engagement requirement implementation, states can proactively catch and address issues—and leverage other existing resources. Nebraska’s Department of Health and Human Services, which implemented the HR 1 community engagement requirements on July 31, 2026,¹⁶ launched with a structured internal governance process to oversee implementation, ensuring all key stakeholders were in the room at the same time and benchmarking accountability to key milestones. Initial analysis of Nebraska’s implementation has shown that 7% of reenrollments and 14% of new enrollments in the Medicaid expansion population were denied coverage due to not meeting community engagement requirements.¹⁷ Of the 533 (7%) who lost coverage, 92% did not respond to verification compliance requests and 8% were confirmed to be noncompliant with requirements. Additional investigation will be needed in Nebraska and other states as they seek to understand how to engage with recipients.

Tools for Measurement

Tracking State Readiness to Implement HR 1 — Georgetown University McCourt School of Public Policy’s Center for Families and Children HR 1 readiness dashboard updates key metrics such as application processing time, overall renewal rate, and ex parte renewals by states.

Medicaid and CHIP Eligibility Operations and Enrollment Snapshot — This monthly CMS report on Medicaid and CHIP eligibility operations can help states to monitor progress on total enrollment, call center metrics and more, and track their performance relative to other states.

Conclusion

HR 1’s community engagement requirements for Medicaid will result in major changes that may cost states millions of dollars in implementation and billions in reductions to federal funding, as well as lost coverage for millions of people. However, with effective planning and foresight, state governments can mitigate some of the budgetary impact and insurance coverage loss associated with community engagement requirements. By streamlining the verification process and providing other supports such as community outreach, states can minimize coverage loss, alleviate administrative burden, and maximize compliance with the law. A state’s Medicaid agency can leverage several approaches and tools in this process, including ex parte data sources, consent-based verification software, mobile-based application portals, and job-assistance programs. At the same time, states can monitor progress toward their goals in real time with the publicly available data dashboards tracking metrics in each state. In combination, these tools can help state Medicaid agencies implement community engagement requirements in a way that maximizes compliance and minimizes undue loss.

Notes