The Trump administration makes it harder for some sick Americans to maintain Medicaid

By Tami Luhby, CNN

(CNN) — Millions of sick Americans could have a tougher time retaining — or even signing up for — Medicaid coverage after the first-ever federal work requirement begins in January in most states.

That’s because the Centers for Medicare and Medicaid Services issued a new rule this week that takes a harder line on defining which low-income adult enrollees are eligible for an exemption for those who are “medically frail.” The rule guides states on implementing the work mandate.

To qualify for the exemption, not only must enrollees have an illness or medical condition, such as cancer or a behavioral health issue, but that condition must also significantly impair their ability to comply with the work mandate, according to the rule, released Monday.

The interpretation came as a surprise to many states and patient advocacy groups and immediately sparked an outcry, with warnings that it will strip needed health coverage from sick enrollees covered through Medicaid expansion.

“It is going to impose a lot more burdens to keeping coverage on people who have very serious conditions for whom loss of coverage can be catastrophic,” said Jocelyn Guyer, senior managing director at Manatt Health, a legal and consulting firm that advises states on Medicaid policy. “It will increase the number of people who lose coverage.”

The work mandate was included in President Donald Trump and his party’s One Big Beautiful Bill Act, which passed last year. CMS is in the process of issuing rules to help states implement the health provisions in the law, which includes historic cuts to Medicaid. The agency said its key focus for work requirements is to increase Medicaid enrollees’ self-sufficiency and economic mobility, while protecting the vulnerable.

The OBBBA requires Medicaid expansion enrollees ages 19 through 64 to work, volunteer, attend school or participate in a job program at least 80 hours a month, unless they are eligible for certain exemptions. Some 5.3 million more people are expected to be uninsured in 2034 because of the work requirement, according to a Congressional Budget Office estimate from last summer.

Tying the exemption to an enrollee’s inability to work, however, is not in the law itself, experts told CNN.

Concerns about care

The rule prompted a swift response from a multitude of patient advocacy groups, who say the stricter interpretation will put people’s lives at risk by jeopardizing their coverage and access to care.

“Because of these requirements, an individual fighting for their life in active cancer treatment will now also have to have to climb what, for some, will be insurmountable obstacles to get or maintain coverage,” said Jennifer Hoque, associate policy principal at the American Cancer Society Cancer Action Network. “If they aren’t able to get through the system fast enough, they’ll show up to chemo or show up for cancer surgery and find out they don’t have the coverage they need. Their lifesaving treatment will be taken from them.”

CMS’ interpretation “clearly conflicts” with the One Big Beautiful Bill Act, according to a group of 48 patient organizations, including the American Lung Association, the Crohn’s & Colitis Foundation, and the National Alliance on Mental Illness.

“Redefining the law’s medical frailty exemption to only apply to individuals who can prove they cannot work and drastically limiting the ability of states to accept self-attestation from patients about compliance and exemptions starting in 2028 clearly conflicts with the law,” the group said in a statement.

“These policies will place massive paperwork burdens on patients and providers, upend months of planning by states and create chaos just months away from the January 2027 implementation deadline.”

CMS did not reply to a request for comment about advocates’ concerns.

Scramble for states

The surprise interpretation adds an extra, two-step hurdle for state Medicaid agencies, who are already facing tight deadlines to stand up their work requirement programs by January. Many have already been setting up their systems based on informal guidance from CMS and must now make changes. Meanwhile, Nebraska launched its work mandate last month but will now have to conform to the new rule.

What’s more, CMS did not provide guidance to states on how to define and assess whether a person meets the medically frail exemption criteria, said Jennifer Tolbert, deputy director of the Program on Medicaid and the Uninsured at KFF, a nonpartisan health policy organization. States will likely adopt different practices, meaning there won’t be a uniform standard for determining if someone is too sick to work.

Further complicating matters is that the severity of these enrollees’ medical conditions — and the impact on their ability to work — can vary over time, as the rule noted.

The provision could also put doctors in a tough spot, since they may be called upon to help determine whether someone is able to work, which would affect their patient’s coverage. That is not typically part of providers’ clinical practice and area of expertise, Guyer said.

Plus, starting in 2028, enrollees and those signing up for Medicaid will only be allowed to self-attest that they qualify for the medical frailty exemption once. After that, if states don’t have data on file to confirm people’s eligibility, enrollees may have to provide documentation, which could prove to be a big lift for some.

States also will not be able to add additional categories to the exemption. For instance, the rule notes that being homeless would not automatically qualify a person as medically frail since that circumstance is not a health condition. However, if that person had a substance use disorder or mental health condition, they could be eligible for the exemption.

Curbing fraud

CMS officials defended their interpretation of the law in a call with reporters, which largely focused on the medical frailty provisions. States can use health claims data or ask for other documentation to determine whether an enrollee meets the criteria in the rule, they said.

“The exemption ensures that work expectations are directed towards those who can participate, while protecting those who cannot,” said Dan Brillman, who directs CMS’ Medicaid program.

Dr. Mehmet Oz, who oversees CMS and is a key player in the Trump administration’s crackdown on fraud in federal programs, linked the provisions to maintaining the program integrity.

“The mantra that we kept coming back to was that we’re forgiving but we’re not foolish,” Oz told reporters, noting that the work mandate will preserve Medicaid for the vulnerable. “Directionally, we are appropriately going after problem areas and doing it in a way that’s compassionate, forgiving — but we don’t want to be fools.”

The medically frail exemption is one of several examples of CMS’ stricter interpretations of the Big Beautiful Bill. Starting in 2028, the agency is eliminating the ability for enrollees to self-attest that they are meeting the work requirement, which can be important for gig workers or the self-employed, or that they qualify for an exemption, such as serving as a caregiver.

In 2027, states can accept self-attestations when there is no reliable data available to prove work hours or exemption eligibility.

Oz warned that enrollees must be honest when self-attesting.

“In the rare instance where you’re self-attesting, you need to tell the truth,” he told reporters on Monday. “We will be speaking with the different enforcement bodies to make sure that folks know that’s not a joke.”

Also, CMS last month proposed a rule that would further curtail states’ ability to boost certain types of payments to providers — beyond the limits Congress included in the law. These payments are used to encourage provider participation and improve access to care for Medicaid enrollees, but the agency argues that the practice drives up costs without ensuring better health outcomes.

The stricter work requirement rule met with the approval of at least one conservative health policy expert. Brian Blase, the president of Paragon Health Institute and an influential voice with the White House and Republican lawmakers, said it “strikes the appropriate balance” between protecting Medicaid’s integrity and accommodating those in need.

“Self-attestation alone for compliance or exemptions — particularly for medical frailty — risks repeating the improper enrollment and fraud seen in other programs when verification standards were weakened,” he said in a statement.

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