The New Medicaid Work Rule Repeats Arkansas Coverage Losses

Adults on Medicaid expansion coverage must show 80 hours of work, school, or service a month starting January 1, 2027, or lose the insurance. The Centers for Medicare and Medicaid Services projects 3.1 million people will lose coverage in the first full year. About 1.3 million of them, in the agency’s own tables, would have met the rule or qualified for an exemption and still get cut for paperwork.

Arkansas already ran this test. In 2018, 18,164 people lost Medicaid after an 80-hour work-and-report rule. A New England Journal of Medicine study found 97% of the target group were already working or should have been exempt. Employment did not rise. The uninsured rate did.

Arkansas Already Ran This Experiment

CMS approved Arkansas Works on March 5, 2018. The state began phasing in an 80-hour monthly work-and-report rule on June 1 for expansion adults ages 30 to 49, then moved toward younger adults in 2019. Unless they were exempt, people had to log work, job training, or community service and report it, at first through an online portal by the fifth of the next month. About 20% of enrollees had no internet access, and another 20% lacked fast broadband.

KFF’s review of state data found over 18,000 people lost coverage in 2018 after three months of missed reports. The precise state tally was 18,164. Safeguards sat on the books. Enrollees filed 904 good-cause requests, 17 reasonable-accommodation requests, and 69 appeals. Technical trouble, not idle months, was the most common approved good-cause reason, which means many people had done the hours and still failed the report.

Harvard researchers writing in the New England Journal of Medicine found the uninsured rate among Arkansans ages 30 to 49 who were eligible for Medicaid rose from 10.5% in 2016 to 14.5% in 2018, while the employment rate slipped from about 42% to just below 39%. A federal judge halted the waiver in April 2019. Most of the coverage losses reversed after the order. A Health Affairs follow-up of people in that age group who had lost Medicaid found 50% reported serious trouble paying medical bills, 56% delayed care because of cost, and 64% delayed taking medication because of cost.

THE 2018 TEST AND THE 2027 COPY

The national statute is H.R. 1, signed July 4, 2025. The Congressional Budget Office estimated it would cut federal Medicaid spending by $911 billion over 2025 through 2034 and leave 7.5 million more people uninsured from the Medicaid changes in 2034, including 5.3 million from the work rules and 700,000 from six-month renewals. Counting marketplace changes, CBO put the law’s total added uninsured at 10 million in 2034.

The Rule Counts 1.3 Million Paperwork Losses

CMS issued the implementing rule, CMS-2454-IFC, on June 1, 2026. States must have the test running by January 1, 2027, unless they start earlier. In the rule’s fiscal 2027 model, 20.4 million people are on expansion coverage. CMS assumes 26% would be exempt, leaving about 15.1 million who have to show they meet the test.

Urban Institute researchers Michael Karpman, Genevieve M. Kenney, and Jennifer M. Haley read the rule’s own tables this way: about 79% of that 15.1 million would be counted as meeting the test through work, 8% through school, and 12% to 13% as not meeting it. That produces about 1.8 million losses for noncompliance. The same tables imply 1.3 million procedural disenrollments among people who should have been counted as compliant or exempt. Added together, that is the 3.1 million first-year figure, and more than 4 in 10 of those losses are paperwork. CMS has the annual drop rising to 3.3 million by 2033. CBO and RAND put the 2034 enrollment cut from the work rules higher, at about 5.7 million and 5.3 million.

CMS FIRST-YEAR SPLIT

• The pool: 20.4 million expansion enrollees in the rule’s fiscal 2027 model.
• The work test: About 1.8 million losses for not meeting hours, school, or pay.
• The paperwork cut: 1.3 million people who should pass and still get dropped.
• The employment claim: The rule assumes about 5 million people will work more, a figure Urban Institute called inconsistent with Arkansas.

The rule also assumes states can verify gig work, self-employment, and school enrollment cleanly. Arkansas could not, and most of the people it dropped never filed a report at all. Starting January 1, 2028, states must demand documents first for most exemptions; 2027 still allows more self-attestation.

Who Has to Log 80 Hours a Month?

Non-pregnant adults ages 19 to 64 on Medicaid expansion coverage in 44 states, including Washington, D.C., have to meet the test unless they fall under a listed exemption. The 41 expansion states plus waiver programs in Georgia, Tennessee, and Wisconsin are in the net. Territories are not. Children, older adults on Medicare, and people already eligible through disability pathways sit outside it. For 2025, 138% of the federal poverty level was $21,597 for a single person.

Kentucky’s Medicaid agency has been telling enrollees the same date and age band.

Beginning January 1, 2027, some individuals must meet new work or community engagement requirements to apply for or keep their Medicaid coverage. This applies to adults ages 19 to 64 enrolled in Medicaid based on their income. pic.twitter.com/PzDMSUseW5

— Kentucky Medicaid (@KentuckyDMS) October 14, 2026

School, Service, and a $580 Pay Stub

CMS says an adult meets the 80 hours per month work requirement by working, doing community service, or joining a work program; by combining those activities; by enrolling in school at least half time; or by earning at least 80 times the federal hourly minimum wage, which is $580 a month in 2026. Seasonal work has a separate formula. New applicants must show at least one month of compliance immediately before the month they apply, and states may demand up to three consecutive months. People already enrolled must show one or more months between renewals, which move from once a year to every six months for this group.

If a state cannot verify the hours, it must send a notice and give 30 calendar days to prove compliance or an exemption. Miss that window and the application is denied or coverage ends. People may reapply at any time and get checked again.

Parents of Young Children Are Out, Parents of Teens Are In

A diagnosis is not an automatic pass. The medical-frailty exclusion is tied to whether an illness significantly impairs the ability to hit 80 hours, so a person in cancer treatment or on HIV medication who can still work may be told to document hours anyway. That is the objection cancer and HIV groups have pressed since the June rule: the paperwork asks about work capacity, not the disease name.

EXEMPTIONS THE RULE LISTS

• Family care: Parents, guardians, and caregivers of a child 13 or under, or of a person with a disability, are out of the test. A parent of a 14-year-old is in.
• Health and pregnancy: Pregnancy and postpartum coverage, medical frailty, special medical needs that block compliance, and drug or alcohol treatment all qualify.
• Other listed groups: American Indians and Alaska Natives, former foster youth, veterans with a total disability rating, inmates, and people meeting TANF work rules or SNAP work rules in a SNAP household.
• Short-term hardship, if a state offers it: Inpatient or nursing-facility care, a presidential disaster, travel for complex medical care, or a county jobless rate at or above 8% or 1.5 times the national average.

New York Medicaid director Amir Bassiri said Bronx residents will be exempt because of the county’s high unemployment rate, covering about 200,000 enrollees who would otherwise have faced the January rules. That is the hardship option used as a county-wide shield, not a personal medical file.

American Academy of Pediatrics president Dr. Andrew Racine warned that when parents lose insurance, children may lose coverage too even if the children remain eligible. Dr. Luke Messac, an emergency physician at Mass General Brigham, said pulling people off Medicaid is the surest way to push medical debt back up after expansion had brought it down.

Nebraska and Montana Are Already Enforcing

Four states did not wait for January. Nebraska began enforcing the federal rule on May 1, 2026, through a state plan amendment. Montana started on July 1, 2026, with penalties. Iowa is set for December 1, 2026. Georgia has run a separate Pathways waiver with an 80-hour test since 2023 for a narrower adult group that never got full expansion.

Arkansas, the state that already lost this fight in court, chose a soft launch on July 1, 2026. About 210,000 people were enrolled in ARHOME, the state’s expansion program, as of May 1. The Department of Human Services is running automated checks and sending status notices. Penalties stay off until January 1, 2027. From that date, people who do not meet the test have 30 days to show compliance before benefits are suspended. They will be able to report by phone, online, or at a county office, a change from the 2018 portal-only design.

If you’re young, healthy, and get government assistance, you should work, go to school, or volunteer.

Sarah Huckabee Sanders, Governor of Arkansas, July 2026 announcement

DHS Secretary Janet Mann said finding a job “brings purpose, meaning, and economic independence, which we know leads to better health.” HHS Secretary Robert F. Kennedy Jr. put the hour count this way: “We are requiring 80 hours per month. It’s not that much.” Arkansas in 2018 already required those hours. The coverage losses came from the report, not from a surge of people who refused to work.

Twenty-five states and D.C. sued over the June rule in Commonwealth of Massachusetts v. Oz. Judge Richard Stearns denied a preliminary injunction on July 30, 2026, and set a merits schedule aimed at a decision before January 1, 2027. The rule remains in force while that case proceeds.

Cancer Screenings the Chicago Model Flags

University of Chicago surgical oncologists Sarah Shubeck and Adrian Diaz modeled what coverage loss of this type does to early detection. In a JAMA Oncology research letter they projected more than 1 million missed cancer screenings in the first two years after the rules take effect, built from Arkansas’s 2018 drop-off and from what happened when verification eased during the pandemic.

The letter counted 405,706 missed mammograms, 679,745 missed colorectal tests, and 67,213 missed lung screenings. It put undetected cases at 1,055 breast, 748 colorectal, and 538 lung cancers, or 2,341 in all, and 155 avoidable deaths from those three diseases (70 breast, 50 colorectal, 35 lung). The authors wrote that the estimates leave out interrupted treatment for people who already have cancer, and that the adults most likely to lose coverage are the ones most likely to gain from early detection.

A particularly concerning aspect is that people who are disproportionately likely to lose coverage are exactly the people most likely to benefit from early cancer detection: younger adults and people from vulnerable social groups.

Sarah Shubeck and Adrian Diaz, University of Chicago Medicine, JAMA Oncology research letter

Hospitals sit on the other side of the same ledger. A Commonwealth Fund analysis using Urban Institute coverage-loss estimates found operating margins at hospitals in expansion states could fall 11.7% to 13.3%, and 25.9% to 29.6% at safety-net hospitals, with unpaid care costs up $7 billion to $8 billion. Congress added a $50 billion rural health transformation fund to the 2025 law. KFF notes that every state has a first-year allotment and that the fund does not offset the federal Medicaid cut.

Two other H.R. 1 changes arrive on the same calendar. Retroactive coverage, which used to reach back three months of bills, shrinks to one month for expansion adults and two months for other groups. And as of October 1, 2026, states must limit federally funded Medicaid to a narrower set of lawfully present immigrants, a change CBO estimated would leave about 100,000 more people uninsured in 2034.

December Hours Decide January Coverage

For a state that uses the minimum one-month look-back and starts on January 1, 2027, an applicant in January has to show December 2026 hours. A three-month look-back reaches back through October. KFF’s tracker found most states planning a one-month look-back at application and renewal. Indiana and Idaho said they would demand three consecutive months at application. Kentucky said it would demand three months at renewal. CMS told states they could not pick a single required month inside a six-month window.

The statute required outreach at least three months before the first look-back. For a January 1, 2027 start with a one-month look-back, that letter had to go out by September 30, 2026. Notices, texts, and emails are already in the mail in the early states. In the rest, December is the first month that will count for January files.

THE DATES THAT LOCK THE TEST

1. July 4, 2025: H.R. 1 is signed, with the work test due by January 1, 2027.
2. May 1, 2026: Nebraska begins enforcing the federal rule.
3. June 1, 2026: CMS issues the interim final rule.
4. July 1, 2026: Montana begins enforcing; Arkansas starts its no-penalty soft launch.
5. July 30, 2026: A federal judge denies a pause of the rule.
6. September 30, 2026: Outreach deadline for states starting in January with a one-month look-back.
7. December 1, 2026: Iowa’s start date.
8. January 1, 2027: National start, six-month renewals, and Arkansas penalties after a 30-day cure period.

The November 2026 elections fall before that start date. The hours that will decide January files are already being worked, missed, or left unreported. In Arkansas, the notices are already specific: meet the test, or use the 30 days after January 1 before the suspension takes effect.

Disclaimer: This article is news reporting on federal and state Medicaid eligibility rules and is for information only. It is not medical advice, insurance advice, or a determination of anyone’s benefits, exemptions, or application status. Readers who need a decision about coverage, an exemption, or a pending renewal should contact their state Medicaid agency or a qualified benefits counselor before they act. Enrollment figures, start dates, look-back choices, and court status come from CMS, CBO, KFF, and state agencies as of the sources used here and can change as states file plans or as litigation proceeds.