Authored by Matt Salo, Salo Health Strategies
The starting gun has gone off, and the race has now really begun.
With Monday’s release of the Interim Final Rule on Work Requirements and Community Engagement, The Centers for Medicare and Medicaid Services (CMS) now has the important task of translating theoretical policy into real-world oversight and management of 40+ states as they sprint toward the finish line. The question is no longer whether states must prepare. The question is whether they can prepare fast enough.
What Are Medicaid Work Requirements?
Medicaid work requirements are federal and state policies that require certain Medicaid beneficiaries to meet employment, education, job training, volunteer, or community engagement requirements to maintain coverage.
Depending on state implementation, beneficiaries may need to:
- Work a minimum number of hours
- Participate in workforce training
- Attend educational programs
- Volunteer through approved organizations
- Report compliance through state systems
States must also establish processes for exemptions, appeals, reporting, and member communications.
The rule codifies several expected policy directions while also introducing new wrinkles that states will need to pivot quickly to accommodate. Unfortunately, the one thing needed most is outside the reach of this, or any, Administration: The ability to warp space and time to create a longer window for states and stakeholders to implement all the changes necessary for this policy to be successful.
At its core, the new nationwide policy aspires to help individuals climb the socioeconomic ladder and eventually trade Medicaid coverage for employer-sponsored insurance or federally subsidized coverage through the Federally-Facilitated ACA Marketplace or State-Based Exchanges. But achieving that goal requires states, their health plan partners, and a broad spectrum of community-based organizations, solution vendors, and other stakeholders to completely rethink how social programs are integrated, how IT systems can help rather than hinder, and ultimately how we handle outreach, engagement, motivation, and activation for millions of individuals who have no idea what is coming or what they will need to do.
For the program to “go live” in six months, many of the decisions around program design, systems procurement, member outreach strategies, and more really should have been finalized months, if not years, ago. For 18 months, many stakeholders have been eagerly anticipating their marching orders because a poorly thought-out or poorly implemented solution will be a policy trainwreck.
Failure to effectively implement this new policy will create confusion, frustration, and the possibility that millions of Americans could lose their health care lifeline without having it replaced. That would be devastating for those individuals and their families. It would be devastating for hospitals, which could see the burden of uncompensated care skyrocket at the same time they are already being hit by policy changes in H.R. 1. And, it would be devastating for health plans, which could lose their ability to effectively manage the care of their members.
Those outcomes would also create an angry electorate, and that frustration could very well make its way to the ballot box.
But real action on behalf of these stakeholders needed to wait for clear state direction. And in many cases, clear state direction hinged on clear federal guidance being publicly available. While the statute called on CMS to deliver guidance this month, the challenge now is how to move at warp speed toward a “minimally viable product” by the deadline.
Technology Will Determine Whether Medicaid Work Requirements (Community Engagement) Succeed
One of the greatest risks facing states is not policy design — it is execution.
Millions of beneficiaries may be required to understand new eligibility requirements, document qualifying activities, respond to notices, and maintain compliance within compressed implementation timelines.
This places unprecedented pressure on:
- Eligibility systems
- Member communication platforms
- Outreach workflows
- Verification processes
- Care management programs
States that rely on fragmented systems risk creating administrative barriers that increase confusion and unnecessary coverage loss. Conversely, modern eligibility technologies can help beneficiaries understand requirements, submit documentation, and maintain coverage when eligible.
This is where operational readiness becomes as important as policy readiness.
Normally, it would be unthinkable for a state to procure any significant changes to its eligibility or other IT systems in such a short period of time. Fortunately, CMS has opened the door and refreshed it’s recommendations about technology partners that can help states with these changes.
There are solutions out there. They can be delivered quickly, cost-effectively, and with the level of flexibility this moment requires. Now is the perfect time to test-run this long-overdue rethinking and see if we can take it even further.
I have been saying, and continue to believe, that the best possible outcome is a delayed implementation of enforcement for these policies. The confluence of these challenges, ideological, fiscal, operational, and technological, combined with the complexity of the messaging and the clear downsides of failed implementation, strongly encourages taking this slowly.
Rather than chalking that up as a defeat, a “soft opening” of these requirements would give all the players time to get it done and get it done right.
The Real Measures of Success
the sensible solution is to continue protecting Medicaid for those who need it now and in the future, while attempting to “make Medicaid less necessary” for those who need a little boost to climb the socioeconomic ladder and trade Medicaid in for alternate forms of coverage.
But that means the work requirement policy actually needs to work. It needs to reward, not punish, those who engage in the necessary activities, or those who are trying their hardest to comply. The success of Medicaid community engagement/work requirements will not be measured by the number of policies implemented. It will be measured by whether eligible individuals can understand the requirements, access support services, and maintain appropriate health coverage while pursuing greater economic stability.
If states, health plans, providers, and technology partners can work together to simplify compliance and reduce administrative friction, this policy could become a bridge to opportunity.
If implementation creates confusion, complexity, or unnecessary barriers, the consequences will extend far beyond policy debates and directly affect millions of Americans.
A program marred by confusing messages, broken systems, or the lack of realistic alternatives to health coverage is a failed program by any metric. If this policy is going to succeed, we need to keep working toward a version that gives states enough time, gives stakeholders enough clarity, and gives individuals a fair shot at understanding and meeting what is being asked of . The difference between those outcomes will be determined by the decisions being made today.
About the author:
Matt Salo is the Founder and CEO of Salo Health Strategies and a nationally recognized Medicaid and health policy expert. He previously served as the founding Executive Director of the National Association of Medicaid Directors, where he worked closely with state Medicaid leaders across all 56 states and U.S. territories. Matt brings decades of experience in health care policy, state government, stakeholder engagement, and Medicaid market strategy.
