Medicaid's new process to verify work requirements likely a costly deterrent in RGV, state

After the One Big, Beautiful Bill was passed on July 4, it left some wondering how it will ultimately affect their Medicaid benefits as reports of anywhere from $800 billion to $1 trillion is primed to be cut from the healthcare program that has aided people in need of medical access for generations.

Dr. Mark Kaswan, a political science professor at the University of Texas Rio Grande Valley, says there are two major takeaways from the bill — the first being the cuts to Medicaid with the intention of saving a significant amount of money; and the second being the elimination of subsidies under the Affordable Care Act, or ACA.

According to the newly passed bill, beginning 2027, some of those applying for Medicaid will now be required to show that they are actively working or engaged in community activities in order to stay eligible.

In the bill this was referred to as the "Community Engagement Requirement," which will apply to those who are between the ages of 19 and 64, not pregnant, not disabled or medically frail, are not already on Medicare and those who enrolled in Medicaid expansion under the ACA.

This change will now require people to prove they are completing, on a monthly basis, at least 80 hours of work. Applicants also have the option of volunteering or doing community service, or enroll in an educational program at least half the time, or participate in a work program, or earn a monthly income that is equal to or more than the minimum wage requirement multiplied by 80 hours.

Any combination of these activities for a total of 80 hours would also qualify.

Applicants will be required to meet the engagement requirement for up to three months prior to their application. For those who are already enrolled, they must meet the requirement between eligibility reviews or more frequently should a state require it.

STATE EXPECTATIONS

Each state is expected to verify whether each individual meets the requirement using standards established by the secretary, which includes using information such as payroll data, payments or other available data.

States are not allowed to outsource compliance checks to any Medicaid managed care entity or other specified entities.

If unable to verify if an individual has met the requirement, the state is expected to provide the individual with a notice of noncompliance as well as give people 30 days (beginning on date of notice) to essentially fix the issue or explain why the requirement does not apply.

In the case that an individual does not respond or comply they may lose the coverage; however, they must be informed of their rights to appeal as well as be checked for other eligibility before being cut off.

Although the changes may not seem too drastic, Kaswan believes this will have an overall negative impact on the community due to a majority of people on Medicaid already working.

BREADTH OF IMPACT

According to a KFF article, in 2023, of the adults under 65 not receiving benefits from Social Security disability programs, Supplemental Security Income, Social Security Disability Insurance and are not covered by Medicare — which make up 92% of people on Medicaid — 44% were working full-time while 20% were working part-time. This totaled 64% of people.

Of the remaining number of people, 12% were not working due to caregiving, 10% due to illness or disability, 8% due to retirement, inability to find work or other reasons while 7% were not working due to being in school.

He explained that the new law is essentially creating "administrative hurdles" that would only make it more difficult for those on or applying for Medicaid.

In fact, he believes that it will discourage people from applying for Medicaid simply because it would be difficult to manage those hurdles.

Kaswan stated this is what will have the biggest impact on people, citing the effects in Georgia after work requirements were implemented there on July 1, 2023.

Only a fraction of eligible Georgia residents have enrolled into Medicaid, according to a ProPublica article, which states that as of May 2025 around 7,500 of the nearly 250,000 eligible residents were enrolled despite the state's data showing that 64% of that group working.

According to an NPR article, the issue lies with the verification system in place which often encountered glitches or would cause people to lose coverage because the system believes they didn't file the paperwork.

Arkansas saw similar system errors when they attempted to implement a work requirement in 2018.

For these reasons Kaswan believes the new work requirements will cause a lot of the people to lose their coverage with the majority being from Texas and the Rio Grande Valley, which already faces a high uninsured rate.

Cameron, Hidalgo, Starr and Willacy counties have uninsured rates of 23.5%, 25.3%, 25.5% and 26.5%, respectively, according to the U.S. Census Bureau. As of July 2024, Medicaid recipients in those counties amount to 104,070 in Cameron, 228,587 in Hidalgo, 20,184 in Starr and 4,745 in Willacy.

That's 357,586 people who have Medicaid in the Valley, nearly 25% of the population.

"The whole point of Medicaid is to help people … get their health taken care of," Kaswan said. "The reality is that it (the changes) only makes health care more expensive."

Overall, the changes in the bill will drive people away from physician offices for primary care, Kaswan said, which may cause a rise in emergency room visits. That's "vastly more expensive," he added.

He explained that emergency rooms are the least efficient and the least cost effective way of providing care as well as the most damaging to people due to many waiting till the last minute to get treated.

"Providing preventive and primary care to people is the most cost effective way of providing health care," Kaswan said.

THE EXCEPTIONS

Although the changes may sound alarming there are some "mandatory exceptions" for certain groups of people including those under the age of 19 or over 65, people who are medically frail, blind or disabled, pregnant or postpartum individuals; parents or caregivers of young children or disabled dependents, veterans with full disability, people in drug or alcohol treatment, people in SNAP work programs, Native Americans and people in jail or prison.

People may also be temporarily exempt if they are facing "short-term hardship" including those who are hospitalized, receiving services from a nursing facility, receiving services from an intermediate care facility for individuals with intellectual disabilities, or receiving services from an inpatient psychiatric hospital or similar acute services.

Temporary exemptions are also applied to those who have to travel for medical care, those who live in an area that has an emergency or disaster declared, or lives in an area with an unemployment rate that's higher than the national average.

The secretary can also exempt a state from meeting the requirements if the request for exemption demonstrates "a good faith effort to comply with the requirements," stated the bill.

During the exemption, states will be required to submit quarterly progress to prove they are working toward full compliance of the new requirements.

Exemption will be available until Dec. 31, 2028 but can not be renewed after that date.

The Administrator of the Centers for Medicare and Medicaid Services will be receiving $200 million in federal funding for the 2026 fiscal year to implement these changes.

The funding will remain available until expended.

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