Implementing new federal Medicaid work requirements presents significant challenges for states, particularly in minimizing coverage disruptions for eligible members. To support effective implementation, state Medicaid agencies can partner with other state agencies to verify enrollee participation in work requirement activities, identify those with exemptions, help connect members to jobs, employment, and education supports, and align necessary systems changes and processes to support efficiency and accuracy. States can draw on lessons from existing cross-agency efforts to guide planning and implementation that addresses the operational aspects of work requirements, supports members’ access to employment opportunities and related services, and prioritizes coverage continuity.

What’s the issue?

Federal changes to Medicaid will tie coverage for many Medicaid members in the expansion population to meeting work requirements. State Medicaid agencies must verify exemption status and participation in qualifying activities such as employment, education, or work program participation when individuals apply for coverage and at renewal. While state Medicaid agencies are not required to help members participate in qualifying activities, they are well-positioned to collaborate with other state agencies to connect interested Medicaid members to other state or local workforce, education, and community services initiatives. Research increasingly recognizes employment as an upstream driver of health outcomes that can support positive outcomes for members, including greater economic security.

What’s the opportunity?

There are numerous opportunities for Medicaid to partner with other state agencies and organizations to create greater efficiencies for the state and members, and to minimize erroneous loss of Medicaid coverage. To verify compliance and certain exemptions, state Medicaid agencies can collaborate with state SNAP/TANF-administering agencies, tax departments, workforce agencies, education departments, corrections systems, and other partners to conduct data matching and analysis. Exhibit 1 outlines state agencies and offices that Medicaid can partner with to verify and promote participation in employment, work, or education programs, and to verify certain exemptions.

Exhibit 1. Opportunities for Medicaid Cross-Agency Partnership on Work Requirements

Support verification and exemption processes. Collaborating with state agencies and other cross‑system partners to support verification processes can:

• Create efficiencies that decrease the costs to state taxpayers for administering the program;
• Minimize reporting burdens for members; and
• Reduce erroneous denial of coverage for eligible members.

While detailed federal specifications for verification and data matching will be included in forthcoming CMS guidance, advance partnership development and planning can help position state Medicaid agencies to successfully meet CMS’ implementation timeline of December 31, 2026.

Connect members to qualifying activities. Cross-agency partnerships can also help connect members who face barriers to employment and education, particularly members with complex health and social needs, to organizations that facilitate job opportunities, training, and support services. Medicaid agencies have an opportunity to learn from workforce development colleagues about how to best create pathways to employment and economic security.

Align implementation to achieve administrative efficiencies. Over time, state Medicaid agencies can explore opportunities to align administrative processes across agencies, such as SNAP, that have prior experience implementing federal work requirements. This alignment can improve efficiency and reduce duplication.

How can state Medicaid agencies collaborate with other agencies to implement new processes accurately and efficiently?

Collaboration between state Medicaid programs, SNAP, workforce systems, and other state agencies can facilitate streamlined implementation of work requirements, helping to minimize coverage disruptions and promote coordinated service delivery. Below are key examples of how Medicaid can collaborate with key state agencies to support effective and efficient implementation of work requirements.

State Tax/Revenue Agencies – Relationships with tax and revenue agencies will play an important role in implementing the new federal work requirements policy, including verifying employment and hours worked. State Medicaid agency partnership and data sharing with Tax and Revenue Departments will be an essential activity to reducing the verification burdens on state Medicaid staff and members.

State Departments of Labor and Workforce Agencies – Partnering with the state workforce agencies, often housed in departments of labor, will be critical both in determining how to efficiently verify Medicaid member participation in job training and work programs and in supporting those seeking work through connections to job training and placement programs. Some state Medicaid agencies, including Kentucky, are proactively developing connections with workforce and employment agencies to support employment outcomes for Medicaid members.

State Departments of Education – Education departments may be important partners in verifying participation in qualifying education activities. An individual enrolled in an educational program (higher education, including 2 and 4-year programs, community colleges, and qualifying career and technical education) needs to demonstrate that they are enrolled for at least 40 hours per month. Medicaid members may also benefit from connections to education opportunities, which may fulfill compliance with new work requirements.

SNAP and TANF-Administering Agencies – Since meeting the current SNAP/TANF work requirements qualifies as a mandatory exemption from Medicaid work requirements, developing or strengthening existing partnerships with SNAP and county welfare agencies will be critical to ensuring Medicaid coverage for applicable members. Medicaid-SNAP/TANF partnerships may be the most important starting point as agencies in many states have active, ongoing partnerships between Medicaid and SNAP/TANF at the state departmental level and through administering organizations, such as local and county-level assistance offices. For example, states can cross-walk SNAP/TANF and Medicaid enrollment to identify enrollees who will qualify for mandatory exemptions. Note that while SNAP currently has work requirements in place, which Medicaid agencies can use to identify mandatory exemptions, H.R. 1 requires SNAP to implement more stringent work requirements and spending cuts on a to-be-defined time horizon. To minimize administrative burden, states can also invest in cross-trained eligibility workers and align recertification timelines to support a more streamlined work requirement verification process.

State Corrections Departments, State and Local Probation/Parole Agencies, Local Jails, and Reentry Organizations – While people leaving incarceration cannot be disenrolled within the 90-day period, many people leaving incarceration will need support in obtaining employment soon after reentry in order to comply with new work requirements. Corrections departments, probation, parole, jails, and reentry organizations have developed strategies to prepare people leaving incarceration to secure jobs, often done through strategic partnerships with private companies. The ongoing 1115 reentry demonstration opportunity and requirements under the Consolidated Appropriations Act of 2023 (sections 5121 and 5022) offer state Medicaid agencies an opportunity to form or strengthen connections with corrections departments. Many state Medicaid agencies and departments of correction have developed partnerships and are in the process of establishing data-sharing agreements to support effective reentry.

Continuums of Care, State Housing Agencies, Homelessness Offices, Public Housing Authorities, and Supportive Housing Providers – Local continuums of care, state housing agencies, and other housing organizations can be important partners to inform tenants or people experiencing homelessness about upcoming work requirements. While people experiencing homelessness are not categorically exempt from work requirements, many may qualify for exemptions under other criteria, including being medically frail.

State Child Welfare Agencies – Former foster care youth under 26 are exempt from federal work requirements but often face significant barriers to enrollment in Medicaid. Child welfare agencies can work with Medicaid agencies to both identify Medicaid enrollees who will be exempt and support effective outreach to this population to ensure this group does not face inadvertent coverage loss.

What are best practices for successful cross-system partnerships?

State Medicaid agencies can learn from existing cross-system efforts to build and strengthen cross-system partnerships. The following best practices can help guide these partnerships.

Align leadership and establish engagement cadence. Similar to other cross-agency efforts, buy-in and collaboration between state Medicaid and other departmental leadership will be important. Medicaid leaders can work with their counterparts in other state departments and agencies to develop a regular meeting cadence and engagement approach that aligns with the needs of both agencies.

When implementing new partnerships, states can draw on lessons from existing cross-system Medicaid partnerships, such as those with state public health and behavioral health departments. Effective strategies include developing a dedicated workgroup to lead the effort, understanding differences in organizational culture, clarifying agency roles and decision-making responsibilities, determining shared goals between agencies, and providing a space for learning and relationship building.

Prepare for data-sharing. The legislation creating federal Medicaid work requirements will necessitate states to implement data-sharing agreements to both ensure that members who qualify for work requirement exemptions are identified and to coordinate verification for those who are subject to requirements. The process, known as ex parte verification, requires the state to use available information to verify a member’s status and minimize, where possible, additional effort on the member’s part. As a first step, states can inventory existing data-sharing agreements, including interagency agreements, to determine what data is currently shared and where gaps exist.

As state Medicaid agencies begin to identify and develop specifications for data that will be needed from other state agencies for verification, it can learn from technical experts within SNAP, TANF, and state health insurance marketplace exchanges, which use similar eligibility determination processes relying on labor and tax/revenue department data.

Explore additional partnerships that expand opportunities for members to meet work requirements. Beyond other state agencies, Medicaid agencies can explore partnerships with local job training organizations, industry associations, faith-based organizations, and the state’s business and nonprofit communities. Nonprofit organizations like United Ways or Goodwill Industries may be able to connect members to qualifying work or volunteer opportunities that fulfill work requirements. Managed care organizations could also be effective partners in this work. In California, CalOptima Health has partnered with a non-profit organization, Chrysalis, to help members experiencing homelessness find employment in homeless shelters.

Looking Ahead

As state Medicaid agencies prepare to implement Medicaid work requirements, partnerships with other state agencies will be critical to effective policy implementation and can help avoid unnecessary coverage loss. Collaboration, data sharing, aligned goals, and close review of recent redetermination efforts are important ways to ensure new Medicaid work requirements are implemented as effectively as possible.