Nullifying the Affordable Care Act: What the Medicaid Work Requirement Really Is All About

Despite a mountain of evidence showing its deleterious effects, a Medicaid work requirement is now law. The mandate, considered by its supporters to be a centerpiece of the One Big Beautiful Bill Act (OBBBA), is the product of a desperate search to find ways to help offset over $3 trillion in tax losses, coupled with the enduring desire among Affordable Care Act (ACA) opponents to repeal the Medicaid expansion for working-age adults. To accomplish their goal, Medicaid advocates coupled a claim that removing millions of people from Medicaid somehow makes the program more efficient with grossly misleading “research” characterizing Medicaid beneficiaries as healthy adults living off their benefits, with free time on their hands.  

This portrayal enabled lawmakers to deny the obvious—that, by indirect means, they were repealing the ACA Medicaid expansion. With a “lazy adult” script in hand (the same one used to impose work requirements as a condition of cash assistance and food benefits), lawmakers turned a blind eye to CBO impact estimates and extensive research showing that work requirements “succeed” in culling the rolls by creating hurdles too impossible to navigate. The efficiency trope is equally outrageous given the enormous implementation burden states now confront.

The work requirement consumes multiple pages of nearly incomprehensible, at times contradictory, statutory text. An added twist is that the legislation bars the Health and Human Services (HSS) Secretary from using his special Section 1115 demonstration powers to help states mitigate the law’s worst excesses.

In the words of the Supreme Court’s landmark decision striking down the ACA’s nationwide Medicaid expansion as unconstitutional, the work requirement is no less than a gun to the head of the 41 expansion states, including the District of Columbia. States that wish to maintain the expansion now can do so only if they place nearly insurmountable barriers against gaining and keeping coverage. States that fail to enforce the law to the letter face enormous financial consequences—not only the loss of the expansion funding for every person incorrectly given coverage but, potentially, a complete cutoff of federal Medicaid funding based on noncompliance with the terms of the law.    

It took years for ACA expansion opponents to finally accomplish their mission. Success ultimately hinged on a tax package that created trillions of dollars in new national debt, which in turn triggered a desperate rush to offset the cost as much as possible, whatever the price paid by people at the wrong end of the wealth spectrum. ACA opponents also succeeded because they had decades of practice, beginning with the (unsuccessful) effort to link Medicaid to work as part of the 1995-1996 welfare reform. Undeterred, advocates kept trying, through the ACA repeal legislation during the first Trump administration and by inviting Section 1115 work demonstrations most of which were blocked in court.  

Virtually from the moment that the OBBBA debate began, it was clear that lawmakers, eager for cash, would try again, ignoring CBO impact estimates showing that 5.2 million people would lose coverage as well as voluminous research examining the damaging effects of work requirements. The evidence shows that 92% of the target group either works or cares for family; it also shows that people who lose coverage either work or qualify for an exemption but are unable to navigate the reporting system.

The implications of the law extend beyond eliminating coverage for millions. Medicaid is foundational to health care. It is the means by which the nation funds a wide range of vital services, especially those that other insurers barely touch: treatment of severe mental illness and addiction; maternity and pediatric care for the poorest families; long-term institutional and community-based care; and clinics and hospitals operating in medically underserved rural and urban communities. By driving people out of Medicaid, work requirements not only will leave millions uninsured but also will deprive health care providers of the revenue they need to serve the entire population.     

Despite its convoluted nature, the legislative text makes its cruelty clear. The mandate extends all the way to age 65—proof that the point is to remove people by sweeping in aging poor workers facing increasingly serious health problems. These older adults decidedly are not mythical young immortals. No matter. Furthermore, despite the fact that many people newly applying for Medicaid have immediate health needs that must be addressed (unlike private insurance or Medicare, Medicaid is continually open to enrollment), the law adopts the Georgia model, which demands proof at the time of initial application. Evidence from Georgia’s still-ongoing work experiment shows that this requirement has basically stopped enrollment from happening; by the end of 2024, enrollment stood at about 5,500 out of an estimated eligible population of 275,000.

Taken together, the application of the law all the way to Medicare eligibility, coupled with the demand for proof at the point of initial enrollment, leave no doubt that nullification of the ACA expansion is the point.

The so-called exemptions are an exercise in pure cynicism. While states, providers, and affected populations await HHS implementation guidance, it is safe to say that simple attestation likely will not be sufficient. HHS will demand hard proof that an applicant or beneficiary is entitled to an exemption; states face severe financial penalties if this hard evidence is missing. For example, the law exempts people who meet the eligibility requirements applicable to the traditional adult population (e.g., deeply impoverished parents of minor children, pregnant women, and people whose coverage is linked to both poverty and disability). But in expansion states, working age adults may apply under the far simpler low-income adult category, which requires proof only of age, income, legal status, and place of residence. Perhaps the worst threat will confront adults awaiting a Social Security Administration disability determination, who will have no other automatic exemption to claim since their disability is not yet proved. They will necessarily rely on medical evidence, which will need to be generated.

Actual work status may be impossible to prove. For people employed at jobs with electronic pay stubs, transmission may be feasible, assuming well-functioning data transfer systems. But millions of poor people work multiple jobs that produce no electronically transmissible records. Who will help them prove their work status?

Then there are the medical exemptions. The law specifies numerous vague health-related exemption categories, leaving it up to the HHS Secretary to flesh them out. For example, the law provides a “medically frail” exemption, which now awaits Secretarial implementation. Other exemptions focus on disabling mental disorder, addiction, or a physical or developmental disability that impairs functioning, or having a serious and complex medical condition. The Trump administration will define these exemptions in terms of scope, documentation requirements, frequency of reporting, manner of reporting, and evidence of compliance. The ramifications are severe both for states, in terms of how to document eligibility, and for health care providers, who must shoulder the sheer weight of responsibility to constantly document the presence of health barriers to work.

These issues await further HHS policy. But the law allows the Secretary to delay issuing implementing rules until June 1, 2026—six months before its effective date. States can ask for more time but must demonstrate their worthiness—that they are making a good faith effort to meet the January 1, 2027 deadline. Furthermore, the law allows the Secretary to ignore normal notice and comment protocols, meaning that implementation could begin without any time for meaningful comment and considered interpretation of the law.

As millions of people disappear from Medicaid rolls, brace for the ultimate claim—work requirements as proof positive that Medicaid adults are simply lazy people living off insurance and playing video games.

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