HR 1 set several key Medicaid provisions into motion. While these changes weigh most heavily on expansion states, there is a patchwork of which provisions apply to which states.
HR 1’s eligibility provisions — including work requirements, more frequent redeterminations and immigrant restrictions — have captured headlines. The law also introduced changes to Medicaid financing, limiting provider taxes and state-directed payments. While some provisions have already kicked off, others are slated for future years.
A KFF analysis published Oct. 7 found that all states, including the District of Columbia, will be affected by at least one update.
Here are five things to know from the KFF report:
- Forty-four states will need to implement work requirements, including 41 that expanded Medicaid and three that did not. Some states fall into this bucket due to certain waivers, even if they are non-expansion states. Many adults in these populations will have their Medicaid eligibility conditioned on at least 80 hours of community engagement per month.
- The 41 expansion states, which includes the District of Columbia, will need to boost the frequency of Medicaid redeterminations from every 12 months to every six months. This change specifically applies to expansion adults, and states must maintain the annual renewal period for others who are eligible due to their modified adjusted gross income.
- The eligibility restrictions for immigrants apply to every state. As of Oct. 1, states have to restrict Medicaid eligibility to only some lawfully present immigrants. While undocumented immigrants have historically been ineligible for Medicaid and CHIP, others who did previously qualify — such as refugees and asylees lacking a green card — no longer do.
- Limits on new or higher provider taxes will apply to all states. For expansion states, beginning in 2027, the cap on provider taxes as a share of net patient revenue will drop by 0.5 percentage points each year until the rate reaches 3.5%. The current cap is 6%. The reduction does not apply to taxes on nursing facilities and intermediate care facilities. At least 31 states have current taxes that surpass the 3.5% threshold.
- Beginning in 2028, the rates at which managed care organizations pay for hospital services could drop in at least 37 states with directed payments that are above the updated limits.
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