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States dealing with budget shortfalls are facing tens of millions of dollars in new costs ahead of the federal Jan. 1 deadline.
The One Big Beautiful Bill Act signed into law in July 2025 called on all Medicaid expansion states to implement work requirements by Jan. 1, 2027. States say they will have to find millions to update their systems to implement the law. | Samuel Corum/Getty Images
The Trump administration is counting on Medicaid work requirements to save the government billions of dollars. But well before the rules formally go into effect Jan. 1, they’re costing already-strapped states millions or tens of millions to implement.
State health departments are having to funnel resources into hiring more staff, paying for overtime, and upgrading their aging technology systems so they can determine which low-income residents are working, volunteering, caregiving, or studying enough hours to keep their Medicaid coverage. They are also building new systems to determine who is sick enough to qualify for an exemption.
