New Medicaid Work Rule Takes Effect in 2027—Who Must Comply?

A new Medicaid rule will require beneficiaries in expansion states to work, volunteer, or attend school for at least 80 hours a month. The policy takes effect on 1 January 2027, with some states already beginning early implementation. The Centers for Medicare and Medicaid Services released the rule on 1 June 2027. It sets clear standards for verification and defines exemptions more precisely. These include pregnant women, caregivers, disabled veterans, foster youth, and individuals with substance use disorders.

Eligibility will need to be checked at least twice a year to confirm compliance. States must use existing data to verify requirements and give beneficiaries 30 days to correct any violations. Adults aged 19 to 64 who are not exempt will be most affected.

States like Nebraska, Arkansas, and Montana have started implementing the rule ahead of the official date. Wisconsin, however, plans to launch on 1 January 2027 to ensure a smooth transition. The state estimates around 63,000 residents will be impacted. The new CMS rule provides clearer definitions but reduces state flexibility in applying exemptions. Beneficiaries in expansion states must now meet work or activity requirements to maintain coverage. States will begin enforcing the changes according to their own timelines.