Dive Brief:
- Up to 2.3 million young adults could lose Medicaid coverage by 2028 as a result of work requirements and more frequent eligibility checks in Republicans’ “Big Beautiful Bill,” according to a new analysis.
- Nearly 9 in 10 adults aged 19 to 24 with Medicaid coverage under the Affordable Care Act expansion already meet the work requirements or qualify for an exemption, like school attendance, the Urban Institute report said. But states have limited data to verify this information, which creates barriers to retaining coverage.
- As a result, young adults’ ability to stay on Medicaid will depend heavily on how states choose to implement the law’s policies, according to the Washington, D.C.-based think tank.
Dive Insight:
The “Big Beautiful Bill” signed into law by President Donald Trump last summer made sweeping changes to Medicaid, which provides free or low-cost health insurance to more than 66 million low-income people nationwide.
The legislation is expected to cut Medicaid spending by nearly $1 trillion over a decade, by curtailing state financing mechanisms, increasing eligibility reviews and requiring adults in Medicaid expansion states to document 80 hours of work, education or volunteer hours each month to maintain coverage.
Between 5 million and 10 million people are expected to lose Medicaid coverage as a result of the changes, many due to administrative barriers to proving they should stay on Medicaid rather than actual ineligibility or a lack of compliance, experts say.
Eventual disenrollment will hinge on how states choose to implement the OBBB’s stipulations, including how difficult they make those barriers to overcome. States have some flexibility in determining how work requirements are implemented, such as defining exemptions like medical frailty and what documentation is required.
Still, young adults face a higher risk of falling through the cracks and could face particularly steep losses, according to the Urban Institute’s new analysis.
That’s because young adults are more likely to move frequently and participate in gig work, which can be hard to track and would not typically be captured in state data.
Researchers set out to map how many young adults would lose coverage under three scenarios: a high-mitigation scenario, in which every state makes policy choices that maintain coverage for the enrollees who meet the requirements; a low-mitigation scenario, in which every state makes choices that lead to higher enrollment losses; and a medium-mitigation scenario between the two.
Young adult Medicaid expansion enrollment could drop by 22% in a high-mitigation scenario to 48% in a low-mitigation scenario, according to the report. That translates to losses of between 1.1 million and 2.3 million people.
Millions of young adults could lose Medicaid, but state mitigation softens impact
About 80% of the young adults whose coverage is in jeopardy are projected to meet the income requirement for at least one month of the prior six months or be enrolled in an education program in the past year, the Urban Institute found.
But it’s not clear whether states will have the data to unilaterally figure out whether those adults are enrolled in school or satisfy some other exemption, according to the report.
Requiring beneficiaries to report or provide documentation like pay stubs or medical records could increase unnecessary coverage losses, given many young adults are unaware of Medicaid’s complex administrative processes, a lack of outreach by states and other challenges.
“The extent of Medicaid coverage drops for this group will depend heavily on state data matching capacity and implementation choices,” Jennifer Haley, principal research associate at the Urban Institute, said in a statement.
States are taking varying approaches to implementing the OBBB’s stipulations. Many are adopting more flexible compliance verification policies, and exploring ways to use new and existing data sources to automate verification and exemptions, according to a survey published this spring. More than two dozen states are suing the Trump administration in a bid to make it easier for Medicaid beneficiaries to prove they’re exempt from looming work requirements.
Meanwhile, some Republican-led states are enforcing even stricter Medicaid work stipulations than required. And a handful — Nebraska, Montana, Iowa and Arkansas — are rolling out their work requirements in advance of the official 2027 deadline.
Rebecca Pifer Parduhn contributed reporting.
