RESOURCE CENTER
H.R.1 and Your Medicaid Enrollment Data
For plans and MCOs, the HR1 redetermination clock is ticking. Your runway ends with the calendar. For renewals scheduled on or after January 1, 2027, expansion adults move from annual renewals to redeterminations every six months. On top of that, the state now has to confirm that a large share of adult members are meeting a brand-new work-or-community-engagement requirement.
CMS projects millions will lose cover. Potentially, 9 out of 10 who drop will drop despite being eligible (Urban Institute), with stale eligibility data and confusing procedures causing most of these.
Plans don’t make the determinations – the state or county does that. But the impact flows downstream in churn volume, retroactive adjustments, and claims denials. By the time the fallout reaches members and providers, it becomes the plan’s problem.
This page explain what H.R.1 requires, the timeline, and the operational questions a plan can act on now.
What H.R.1 Changes, in Plain English
H.R.1, the One Big Beautiful Bill Act, was signed into law on July 4, 2025 as Public Law 119-21. For a health plan, two provisions turn eligibility from an annual event into a rolling one.
How Plans Are Affected
The plan does not make the eligibility determination. That sits with the state, and in county-administered states like California, with the county. But the plan lives with the result. When a determination goes wrong upstream, the plan is the one holding stale eligibility data, denied claims, and a member who can’t fill a prescription.
Most of the coverage loss projected under H.R.1 is not about eligibility. The Urban Institute found that 89% of the adults ages 19 to 64 this applies to are already working, in school, caregiving, or would qualify for an exemption. But researchers project that 5.5 to 6.3 million could lose coverage, caused primarily by confusing notices and reporting systems that are hard to use. In other words, a paperwork problem, not an eligibility problem.
CMS says much the same thing, projecting in its own regulatory impact analysis that roughly 15% of adult group enrollment will lose coverage: about 9% for not meeting the requirement, and about 6% for administrative reasons.
How the burden moves. The decision is made at the top. The consequences are absorbed at the bottom.
The burden starts as a policy decision at the state. By the time it reaches the member and the provider, it looks like the plan’s problem. Because operationally, it is.
Cindy Parker, Sr. Consultant, Compliance and Medicaid/Medicare, CureIS Healthcare
What is in the plan’s hands
The state tells you how often to redetermine, but you control how fast to load enrollment. If a member misses a deadline, gets dropped, and turns in the documentation the next day, a plan loading enrollment monthly shows that person ineligible for weeks. A plan loading daily shows them eligible tomorrow. Same policy, same state, very different experience for the person whose claim could be denied because their eligibility data is stale.
Plans can also ensure documentation protects their members. An exemption only protects a member if it is recorded and current before their redetermination comes up. Knowing which of your members are likely exempt or already compliant, and making sure the data proves it, is the highest-leverage work available to a plan right now.
Where Things Stand
As of September 2026
H.R.1 requirements are still unfolding, while some early states are already living it. We update this section as things change.
Fact Sheet
H.R.1 by numbers and dates
Key details, effective dates, and sources. Download a printable one-page version at the bottom of this section.
Sources: CMS interim final rule CMS-2454-IFC and its regulatory impact analysis (June 2026); Urban Institute, Expanding Federal Work Requirements for Medicaid Expansion Coverage to Age 64 Would Increase Coverage Losses (April 2025).
Key dates
| When | What happens |
|---|---|
| Jul 4, 2025 | H.R.1 signed into law as Public Law 119-21. |
| Dec 8, 2025 | CMS issues its first informational bulletin on the community engagement requirement (Section 71119), along with $200 million in federal implementation funding split across the 51 jurisdictions. |
| Mar 6, 2026 | CMS issues State Medicaid Director letter SMD 26-001 on the eligibility redetermination requirements (Section 71107). |
| Jun 1, 2026 | CMS issues the interim final rule with comment period on the community engagement requirement (CMS-2454-IFC). Published June 3, regulations effective July 31, 2026. |
| Jun 30 – Aug 31, 2026 | Statutory window in which state Medicaid agencies had to notify affected enrollees, by first-class mail plus at least one other channel. Now closed. |
| Jul 30, 2026 | Federal judge in Massachusetts declines to block the rule. It stays in force, and the court sets an expedited schedule aiming to rule on the merits before January 1, 2027. |
| Sep 21, 2026 | Comments due on CMS's proposed rule implementing the provider tax phase-down and the new-tax prohibition. An open deadline, if your organization wants to be heard. |
| Oct 1, 2026 | Federal Medicaid and CHIP eligibility narrows for several categories of lawfully present non-citizens, including asylees, refugees, and trafficking and domestic violence survivors. Emergency Medicaid federal match drops from the 90% expansion rate to the state's regular FMAP for people who would otherwise be expansion-eligible. New and increased provider taxes barred, with taxes in place as of July 4, 2025 grandfathered. |
| Jan 1, 2027 | The big one. Community engagement requirement must be in place in expansion states. Six-month redeterminations begin for renewals scheduled on or after this date. Retroactive coverage shortens to one month for expansion adults and two months for everyone else, for applications filed on or after this date. |
| Jan 1, 2028 | For rating periods beginning on or after this date, grandfathered state directed payments begin stepping down toward the new Medicare-based caps, 10 percentage points a year. Caps are 100% of Medicare in expansion states, 110% in non-expansion states. |
| FY2028 – FY2032 | Provider tax hold-harmless safe harbor in expansion states steps down annually: 5.5%, 5.0%, 4.5%, 4.0%, then 3.5% from FY2032. Non-expansion states stay at 6%. Nursing facilities and ICF/IIDs are carved out. |
| Oct 1, 2028 | Cost sharing of up to $35 per service begins for expansion adults above the poverty line, capped at 5% of income. Primary care, behavioral health and substance use treatment, family planning, emergency care, institutional long-term care, and FQHC, RHC, and CCBHC services are exempt. |
| Through Dec 31, 2028 | Outer limit for good faith implementation extensions the HHS Secretary may grant. States can request six months at a time, extensions can't be renewed past that date, and CMS can terminate one for failure to report progress. CMS has signaled these are for extraordinary circumstances, not general unreadiness. |
The financial frame
| Figure | What it measures |
|---|---|
| ~$911 billion | CBO's estimate of the reduction in federal Medicaid spending over ten years across the enacted package. |
| ~10 million | CBO's estimate of the increase in people without health insurance under the package. The Medicaid provisions alone account for roughly 7.8 million by FY2034. |
| $326 billion | Federal savings attributed to the work and reporting requirement alone, the single largest Medicaid item. |
| $63 billion | Federal savings attributed to more frequent redeterminations for the expansion group. |
| $50 billion | The Rural Health Transformation Program, distributed to states FY2026 through FY2030. |
| 40 states + DC | Jurisdictions that adopted the ACA Medicaid expansion. Counting certain section 1115 demonstrations that cover adults, KFF puts 44 jurisdictions in scope for the new requirement. |
Exemptions and Earnings
The statute and CMS-2454-IFC take certain adults out of the community-engagement requirement altogether. Mandatory exemptions include pregnant and postpartum women, American Indian and Alaska Native members, veterans with a total disability rating, former foster youth in the specified group, parents and caretakers of a child age 13 or under or of a disabled dependent, people who are medically frail, and people already meeting SNAP or TANF work requirements. States may also grant short-term hardship exceptions. Those can cover members in inpatient or other intensive care, members who must travel outside their community for care, members in a federally declared disaster area, and members in counties where unemployment is at or above 8 percent or 1.5 times the national rate.
Meeting the 80-hour test without an hours log: Exemption and compliance are different paths. An exempt member does not have to document activity. Everyone else must show they met the month’s test. That test can be met in hours (work, community service, a work program, half-time school, or a combination totaling 80 hours) or in earnings. Monthly income of at least 80 times the federal minimum wage counts as meeting the requirement. At the current $7.25 federal wage, that is $580 in 2026. Seasonal workers may be allowed to average income over a longer window. For plans, the earnings path is the operational point. Gig, seasonal, and variable-hour members often cannot produce a clean hours log. Wage data that clears $580 can satisfy the month even when the hours file would fail. Treat income as a compliance signal, not as an exemption.
How medical frailty gets defined is contested. CMS does not treat a diagnosis as enough. Under the interim final rule, a member is medically frail only if they fall in one of the five statutory categories and the condition significantly impairs their ability to meet the 80-hour requirement. The five categories are: blindness or disability; substance use disorder; a disabling mental disorder; a physical, intellectual, or developmental disability that limits one or more activities of daily living; and a serious or complex medical condition. That two-part definition is what states challenged in Commonwealth of Massachusetts v. Oz, filed June 29, 2026 in the U.S. District Court for the District of Massachusetts. Plaintiffs also challenged the 12-month look-back, limits on member attestation, and the hardship exemption. Judge Richard Stearns denied a preliminary injunction on July 30, 2026, without prejudice, on irreparable-harm grounds, and set an expedited merits schedule aimed at a decision before January 1, 2027. The rule is in force. Plan for January. If the court later changes how frailty is verified, the operational work you do now on claims, encounters, and exemption flags still shortens the time between a state determination and a clean eligibility file.
Webinar · Episode 5
H.R.1 Readiness: Protect Your Members and Your Revenue
A conversation about what H.R.1 changes on the ground and the one or two moves that help your members stay covered.
What's covered
- Why a determination you don't control still becomes your operational problem.
- How the burden flows from state to county to plan to member.
- What California's county-administered model means for a statewide plan.
- How daily versus monthly enrollment processing protects members.
- Why more staff and a bigger overnight batch job won't close the gap.
- What "ready" looks like six months from now, and the two paths to get there.
- Prepared Q&A: cost exposure, risk-pool skew, and where to start with limited resources.
Sr. Consultant, Compliance and Medicaid/Medicare, CureIS Healthcare
Business Relationship Manager, CureIS Healthcare
From the CureIS blog
Surviving the H.R.1 Trillion Dollar Tremor
A comprehensive discussion of what the H.R.1 spending shift means for Medicaid plans, and why the organizations that come through it well will be the ones that fixed their data foundation before the ground moved.
Readiness self-assessment quiz
Eight questions you will need to answer before January 2027
Instant read-out. Your data is not collected or stored by us. If your answers are mostly guesses, that's your assessment.
Reading list
Key Reading
Government sources , independent analysis, and a few state examples.
Government and regulatory
- H.R.1 full bill text and legislative history Congress.gov · Public Law 119-21
- Community Engagement implementation hub for states Medicaid.gov · guidance, FAQs, slide decks, technical assistance
- Interim final rule fact sheet (CMS-2454-IFC) CMS · June 1, 2026
- The rule itself, as published Federal Register · June 3, 2026
- CMS framework for implementing work requirements CMS newsroom
- State Medicaid Director letter on eligibility redeterminations CMS · SMD 26-001, March 6, 2026 (PDF) · Section 71107
- Informational bulletin on establishing community engagement requirements CMS · December 8, 2025 (PDF) · Section 71119
- Health Provisions in P.L. 119-21, the FY2025 Reconciliation Law Congressional Research Service · R48633 · reflects enacted law, not the House-passed bill
Independent analysis
- Health Provisions in the 2025 Federal Budget Reconciliation Law KFF · provision-by-provision summary
- A Closer Look at the Work Requirement Provisions KFF
- Work requirements implementation tracker KFF · state by state, updated regularly
- Early Look at State Policy Decisions KFF
- Understanding the cost sharing changes KFF · for the October 2028 provisions
- Projected enrollment reductions in 2028, national and state Urban Institute · post-enactment estimates
- Massachusetts v. Oz litigation tracker Georgetown Law · filings and status of the multi-state challenge
- On the July 2026 provider tax proposed rule Georgetown Center for Children and Families
- How the new provider tax limits affect Medicaid funding Commonwealth Fund
- Analysis of the interim final rule State Health and Value Strategies, Princeton
- H.R.1's changes to non-citizen coverage, FAQ State Health and Value Strategies
- A Summary of Federal Medicaid Work Requirements Center for Health Care Strategies · two-page cheat sheet
- Explainer on the interim final rule Georgetown Center for Children and Families
- Why states say they need more time Center on Budget and Policy Priorities
- Rural Health Transformation Program in context Commonwealth Fund
- Implications of H.R.1 for managed care pharmacy AMCP
State implementation examples
- Missouri's public H.R.1 timeline Missouri Department of Social Services · member-facing communication example
- Arizona AHCCCS H.R.1 overview AHCCCS
- Colorado's key changes page Colorado Department of Health Care Policy and Financing
Find your own state. Search your state Medicaid agency site for “H.R.1” or “community engagement.” Most agencies now have a dedicated page, and county-administered states often publish separately at the county level.
Questions for CMS
CMS has opened a technical assistance mailbox for state implementation questions: MedicaidWorks@cms.hhs.gov
Plain English
Glossary
- H.R.1 / OBBBA / “Working Families Tax Cut”
- All the same law: the budget reconciliation act signed July 4, 2025 as Public Law 119-21. The “One Big Beautiful Bill Act” short title was actually struck in the Senate, so the law has no official short name, which is why CMS calls it the Working Families Tax Cut legislation and why the medicaid.gov guidance URLs read that way. Useful to know when you're searching.
- Expansion adult
- An adult covered by Medicaid because their state adopted the ACA Medicaid expansion, generally ages 19 to 64 with income up to 138% of the federal poverty level. This is the group most of the new H.R.1 rules apply to.
- Community engagement requirement
- The formal name for the work requirement: 80 hours a month of work, self-employment, job training, community service, or half-time school, documented as a condition of eligibility.
- Redetermination (renewal)
- The periodic check that a member is still eligible. Moving from twelve months to six months for expansion adults is what doubles the churn.
- Ex parte renewal
- A renewal the agency completes using data it already has, without asking the member for anything. The more of these a state can do, the fewer people fall out for paperwork reasons.
- Procedural termination
- Losing coverage for a paperwork reason, a missed notice, an unreturned form, rather than because you were found ineligible. The dominant story of the COVID unwinding, and the risk H.R.1 amplifies.
- Medically frail
- An exemption category covering people with serious conditions or disabilities. How narrowly CMS defined it is the core of the ongoing multi-state lawsuit.
- Retroactive coverage
- Coverage back-dated to before the application date. H.R.1 cuts this from three months to one month for expansion adults and two months for others, starting January 1, 2027.
- Continuous reconciliation
- Comparing your eligibility and enrollment records against incoming source data on an ongoing basis, so mismatches surface within a day instead of at the next renewal.
- Stale eligibility
- Your system says one thing, the state says another, and nobody knows yet. It is how eligible members get turned away and clean claims get denied.
From the webinar Q&A
Questions we get asked
If the state makes the determination, why is this the plan's problem?
Because you absorb every consequence of it. Members cycling off and back on, retroactive changes to reconcile, providers submitting clean claims against eligibility data that is four weeks old. You cannot change the determination. You can change how quickly your record of it becomes accurate.
Do we have a realistic estimate of what H.R.1 costs a plan?
Start with CMS's own regulatory impact analysis in the interim final rule. It projects roughly 15% of adult group enrollment losing coverage, about 9% for not meeting the requirement and about 6% for administrative reasons, which works out to roughly 2.3 million fewer people enrolled in FY2027 and 3.1 to 3.3 million in later years. Run that percentage against your own expansion membership and you have a first-order revenue estimate.
There is also a hidden cost that gets missed: the expansion adults most likely to churn out are generally lower-acuity and lower-cost. When they drop, you lose the revenue and your remaining risk pool skews sicker, without a matching change in what you are paid. That is a margin problem, and data accuracy is one of the few levers you control against it.
We have limited resources. Where is the most leverage?
Exemptions. Around nine in ten of the people this applies to are already working, engaged, or exemption-eligible, but an exemption only protects a member if it is documented and current before their redetermination. Track who is likely exempt or already compliant, make sure the data reflects it, then do targeted outreach to those members. That is the cheapest stabilization available.
Can't we just add staff, or run a bigger overnight batch?
That worked when eligibility moved once a year. H.R.1 turns it into something closer to a live feed, and the incoming data is messy: unemployment records, work program participation, education data, sometimes a photo of a hand-filled form. Manual review at that volume produces errors, and the errors drop eligible people.
Should we build this ourselves or bring in help?
Honestly, it depends on your IT capacity and your runway. If you have the team and the budget, daily processing and continuous reconciliation are real engineering work but entirely solvable, and plenty of plans started building early in 2026. If you do not have that runway before January, buying is the faster path. Either way the requirement is the same: current data, continuous reconciliation, and an audit trail.
What about brand-new enrollees?
Different and harder. For existing members you can keep the data continuously clean, so it is already good when redetermination arrives. For new applicants, the rules can require proof of qualifying activity from before they enrolled, which means acquiring data you never had. Plan for that separately.
What is the first step if we think we are exposed?
Map your current enrollment and eligibility data flows, and count the hours your team spends on reconciliation, rework, and resubmission. Then find out how often your plan loads enrollment. If it is not daily, that is your starting line. Don't wait for the next cycle to show you the gaps.
Could the January 1, 2027 date slip?
Possible but not something to plan around. The HHS Secretary can grant good faith implementation extensions, in six-month increments and no later than December 31, 2028, and CMS has said it will weigh whether a state had a detailed work plan and made demonstrable progress during 2026. Extensions can't be renewed past that date and can be terminated. On the litigation, a federal judge declined to block the rule on July 30, 2026 and set an expedited merits schedule, so the medical frailty definition could still shift. The requirement itself is not going away. Build toward January 2027, and keep an eye on whether your own state has requested an extension.
One key move you can make this week
Find out how often your plan loads enrollment
If it isn't daily, that's your starting line. If most of your reconciliation is still manual, that's an action item.
Not sure where to start? Sit down with us. One of our analysts will walk your eligibility data flow end to end and show you exactly where you stand. No commitment, and a real person, not a bot.
CureIS has spent more than a decade running daily enrollment processing for leading health systems in Arizona, California and elsewhere. Our EnrollmentCURE modules handle daily enrollment processing and UniSync continuously reconciles the data underneath. CureIS tools work alongside the core systems you already run, including Facets, QNXT, and HealthRules. No rip and replace. Implementation in weeks.
