Medicaid Unwinding: Lessons for Work Requirement Implementation

A 2025 reconciliation law, known as the One Big Beautiful Bill Act (OBBBA), requires states to implement Medicaid work requirements starting January 1, 2027. These requirements will apply to adults in the Affordable Care Act (ACA) Medicaid expansion group and enrollees in partial expansion waiver programs, specifically those in Georgia and Wisconsin.

To maintain their coverage, eligible beneficiaries must regularly demonstrate that they are working, volunteering, or participating in approved community engagement programs. While the federal mandate begins in 2027, states have the option to implement these requirements earlier.

Implementing these requirements is a resource-intensive effort that necessitates policy and operational decisions, system upgrades, new outreach strategies, and the hiring and training of staff within a short timeframe.

Lessons from Medicaid Unwinding

As states prepare for this shift, they are drawing on lessons from the Medicaid unwinding process. This process began in April 2023, when states ended the pandemic-era continuous enrollment provision that had paused Medicaid eligibility redeterminations in exchange for federal funds.

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During the unwinding, states conducted eligibility redeterminations for all program participants, disenrolling those who were no longer eligible or failed to complete the renewal process. This period highlighted the complexity of eligibility processes and demonstrated how federal and state policy decisions, implementation strategies, and IT systems directly influence coverage outcomes.

The unwinding experience revealed that some states faced high rates of procedural disenrollments. In these cases, individuals lost health coverage not because they were ineligible, but because states could not confirm eligibility due to administrative hurdles or outdated contact information.

The Role of Outreach and Communication

Analysis of the unwinding process shows that states investing in robust and diverse outreach methods achieved better redetermination outcomes. Rather than relying solely on letters, successful states utilized multi-channel campaigns, strategic partnerships, and artificial intelligence.

• Arizona achieved a 76% renewal rate by deploying customized toolkits for tribal communities, a surge call center, chatbots, and strategic partnerships.
• Washington, D.C. Used digital engagement, targeted mailings, and community partnerships to encourage beneficiaries to update their contact information and complete the redetermination process.

Consistency in messaging also proved critical. Emma Sandoe, the Medicaid director at the Oregon Health Authority, noted that Oregon ensured partners and managed care entities used the same materials during the unwinding period to prevent confusion at call centers.

IT Systems and Data Management

The transition back to routine eligibility checks emphasized the intricate nature of state data systems. The unwinding process illustrated how IT systems are layered and how they interact with different aspects of a state’s data set.

Unwinding really taught us how IT systems are layered in and how IT systems touch different aspects of each individual state’s set of data

Emma Sandoe, Medicaid director at the Oregon Health Authority

These technical challenges often highlighted the difficulty states face in maintaining accurate and up-to-date data on enrollees, a factor that could similarly impact the implementation of work reporting requirements.

Oregon officials have stated their intention to use the processes developed during the Medicaid unwinding to comply with the upcoming requirements mandated by the One Big Beautiful Bill Act.