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What is H.R. 1 and the Federal Changes to Medicaid?

Federally mandated changes will have a significant impact on Medicaid. They will change eligibility rules for some people and how Medicaid operates.

The Impact of H.R.1 and Federal Changes to Medicaid 

On July 4, 2025, the House Reconciliation bill (H.R.1), previously known as the “One Big Beautiful Bill Act,” was signed into law. These federally mandated changes will have a significant impact on Medicaid with the new Medicaid provisions taking effect over the next several years. They will change eligibility rules and how Medicaid operates.

H.R. 1 Enrollment and Eligibility - Upcoming Changes

Eligibility Changes for Certain Immigrants

This change will limit Medicaid eligibility to lawful permanent residents, certain Cuban and Haitian entrants and individuals from the Compacts of Free Association nations.

It excludes refugees, asylees and other humanitarian groups previously eligible for Medicaid coverage.

The impact on immigrant eligibility for Medicaid and Federal Marketplace (ACA) programs is effective October 1, 2026. This includes:

• Restricts the definition of qualified immigrants for purposes of Medicaid eligibility to legal permanent residents (i.e., green card holders), certain Cuban and Haitian immigrants, citizens of the Freely Associated States (COFA migrants) lawfully residing in the US and lawfully residing children and pregnant adults in states that cover them under the Immigrant Children's Health Improvement Act (ICHIA) option (also referred to as CHIPRA 214).
• Limits federal matching payments for Emergency Medicaid for individuals who would otherwise be eligible for expansion coverage except for their immigration status to the state’s regular Federal Medical Assistance Percentage (FMAP).

Changes to Retroactive Coverage

The following changes will affect people who apply for Medicaid benefits on or after January 1, 2027.

• The mandatory retroactive coverage period changes from 3 months to 1 month prior to the month of application for some low-income adults, ages 19 through 64, without disabilities (also known as the Medicaid expansion population).

•  Limits retroactive coverage for children, adults age 65+ and individuals with disabilities to 2 months prior to the month of application.

Work/Community Engagement Requirements

Requires some low-income adults, ages 19 through 64 without disabilities (also known as the Medicaid expansion population) who are current Medicaid beneficiaries or applying for Medicaid to work or participate in qualifying activities (such as work, participate in a work training program, or volunteer in the community) for at least 80 hours per month or attend school at least half-time unless they meet an exemption.

Who is exempt from the community engagement/work requirement?

• Children age 18 or younger
• People with disabilities, receiving Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI)
• Adults age 65 or older
• People who are pregnant or eligible for postpartum coverage (12 months after a pregnancy ends)
• Former foster care children age 25 or younger
• Parent or caregiver of a child under age 14
• Parent or caregiver of people with disabilities
• Veterans with a total disability
• American Indian/Alaska Natives
• People who are medically frail*
• People enrolled in a substance use disorder treatment program
• People who are incarcerated or people who have been released from incarceration in last 90 days
• People who qualify for Medicare

* Criteria still to be determined
Begins January 1, 2027 

Six-month Eligibility Redetermination for Certain Beneficiaries

Beginning December 31, 2026, some low-income adults ages 19 through 64 without disabilities (also known as the Medicaid expansion population) must have their Medicaid eligibility redetermined every 6 months instead of the traditional 12 months.

This applies to those applying for or renewing their Medicaid coverage.

Note: Information may change with the Centers for Medicare & Medicaid final rule.