Nebraska’s work requirements for Medicaid coverage start on Friday.
Though last year’s One Big Beautiful Bill Act – or H.R. 1 – required states to implement work and community engagement requirements for Medicaid recipients by Jan. 1, 2027, Nebraska is ahead of schedule. It will be the first state to comply under the new law.
Most able-bodied enrollees between 19 and 64 will need to log at least 80 hours a month of employment, work program attendance, volunteering or schoolwork. Recipients making at least $580 a month will also be considered to have met the requirement.
Some Nebraskans will be exempt. The standard Medicaid population – including aged, disabled, pregnant and child recipients – and people considered “medically frail” will not have to meet work requirements.
Proponents of work requirements say they promote employment and lift people out of poverty.
“This is a hand up, not a handout,” Gov. Jim Pillen said at a December press conference announcing the state would implement the requirement early. “It's a key piece of giving the discipline for our families to be successful. It's a key piece of self-worth. It's a key piece of mental health and stability.”
Pillen said the state would “err on the side of people’s welfare.” Exemptions are also made for “temporary hardships” such as hospitalization.
Opponents say they add administrative burden to states and cause eligible people to lose health coverage. According to the nonpartisan policy research group Center for Budget and Policy Priorities, between 28,000 and 41,000 Nebraskans are “at risk of losing coverage” once work requirements are implemented.
That estimate is based on the number of people who would need to take action to stay enrolled in Medicaid, said CBPP researcher Elizabeth Zhang. If Nebraska is successful at identifying which enrollees are in compliance with work requirements or exempt from them without most enrollees having to take action, it’s likely that fewer people will lose their coverage, she said.
DHHS said that number – and similar estimates by other groups – are modeled at a national scale and makes “broad assumptions” about the Medicaid expansion population. The department said those numbers assume administrative burden and would account for more coverage loss than non-compliance, but Nebraska’s system is designed to address those concerns.
“None of this means we are complacent about coverage continuity,” the DHHS Office of Communications wrote to Nebraska Public Media News. “We take the risk of unintended coverage loss seriously, and we will monitor implementation closely. But we believe the national estimates, while useful as a policy planning tool, do not fully account for the operational advantages Nebraska brings to this work or the safeguards we have built into our approach.”
DHHS said Medicaid work requirements will not apply to all Medicaid expansion members right away but will be enforced the next time enrollees are up for renewal.
“Members with renewal dates in May or June 2026 will not be subject to the requirements. The first group impacted will be those with eligibility periods ending July 31, 2026, with phased implementation continuing through June 2027,” a press release from DHHS stated. “Existing members must demonstrate at least one month of compliance with work requirements since their initial eligibility determination or most recent renewal.”
Implementation
The Nebraska Department of Health and Human Services administers the Medicaid program in Nebraska. Director of Medicaid and Long-Term Care Drew Gonshorowski said the department is ready for the change.
“Ultimately, it's similar to how eligibility works in Nebraska currently, which is the applicant, enrollee, caseworker and system all work together.”
Gonshorowski said Nebraska is “uniquely positioned” to implement requirements early.
“There's a few factors on our system side that are particularly relevant in terms of what we were able to leverage here. One of those things is we own our state enrollment and eligibility system,” Gonshorowski said. “We're just in a situation where we can be more nimble in terms of how verification actually works.”
Many other states rely on third-party vendors for their enrollment software and do not have direct control over the system.
According to the DHHS website, the department will use information it already has to determine if an individual is meeting work requirements.
“Medicaid agencies – and this is eligibility broadly as well – are required to use available information to confirm if an applicant or enrollee is already meeting work requirements before asking them to provide information,” Gonshorowski said.
DHHS said many enrollees “are expected to qualify based on existing information without needing to take additional action.” The department estimates about 40% of Medicaid expansion enrollees in the state make at least $580 a month, and 60-72% of members are likely already meeting work or community engagement requirements.
If DHHS cannot verify compliance based on information it has, the department will request more information from the enrollee, who will have 30 days to respond.
Gonshorowski said Nebraska DHHS has worked with the federal Centers for Medicare & Medicaid Services (CMS) to set up the new work requirements, hosting an on-site visit in January and meeting on a weekly basis since then.
“We also have loads of outreach from other states in terms of our ability to collaborate, and we actively engage in national forums, like the National Association of Medicaid Directors, the Medicaid Enterprise Systems Conference, and then also working with other state agencies through the American Public Human Services Association,” Gonshorowski said. “We've been actively engaged in ensuring that we have the most pertinent information as we work to implement this.”
However, staff will undergo updated training.
“Our current verification team already has extensive experience and expertise in determining eligibility and they are well positioned to manage this process,” Director of Communication Jeff Powell said. “The team will also complete newly developed training specific to work requirements by April 30 to ensure a smooth and effective implementation.
By the numbers
Most people subject to work requirements are Medicaid expansion recipients. Nebraska adopted Medicaid expansion via a ballot initiative in 2018, and expanded coverage was available starting in 2020. The program is called Heritage Health Adult in Nebraska. Able-bodied adults making up to 138% of the federal poverty level – about $22,000 a year for a single person – are eligible.
According to Nebraska DHHS’ Division of Medicaid and Long-Term Care 2025 annual report, about 112,600 Nebraskans were enrolled in Medicaid expansion. There were about 338,000 total Medicaid enrollees.
Sorting out who has to meet work requirements could be a challenge for enrollees – and as Nebraska Appleseed’s Healthcare Access Program Director Sara Maresh said, for DHHS.
“A vast majority of Nebraskans are working or would meet an exemption, but it is the red tape that's what causes the problems and really causes people to lose coverage,” Maresh said on a Wednesday call with reporters.
Maresh called the rollout of Nebraska’s work requirements “a rush job.” She said concerns about lack of staff and training, which conditions exempt people as “medically frail” and coverage loss are front of mind.
“I think it's very telling that other states are sounding the alarms that even implementation by January 1 of 2027 is way too early and rushed,” Maresh said.
Education and outreach is the biggest concern for Maresh and other advocates.
“We think the state hasn't been doing enough outreach. People don't know what's coming, and they don't know it applies to them, and they're just, frankly, unable to understand this,” Maresh said. “This is a really complicated system that's been set up to have people lose coverage.”
President of the Nebraska Rural Health Association Jed Hansen said that outreach is a key piece of who will lose coverage.
“And it's not necessarily because of a lack of work, but because of the reporting burden and the overall awareness of the requirement,” Hansen said.
He said loss of coverage could have greater effects on rural Nebraska.
“The Medicaid population in general in Nebraska skews towards more heavily rural and towards greater Nebraska. We also know that we disproportionately see Medicaid disparities show up in things like emergency department care, maternal care, mental health and dental – all things that we desperately need coverage in to ensure that some of those downstream health complications don't become worse.”
Hansen also worries rural hospitals could see additional burdens – both in a potential increase in uncompensated care and in educating their communities.
“My concern is that – for our rural hospitals and clinics – a lot of this burden is going to ultimately fall on them to make sure that those in their community that are eligible for coverage are able to stay covered,” Hansen said.
Filling those needs could take up staff capacity and raise costs for rural hospitals that already run on tight margins.
To alert Medicaid enrollees of changes, DHHS sent out letters, emails and text messages, and ran TV, radio and social media ads.
“Efforts include distributing more than 75,000 letters, 38,000 text messages, and 10,000 emails. Since January 1, the department has also sent monthly communications to newly enrolled members, averaging 4,000 notices, 2,000 text messages, and 400 emails per month,” DHHS’s Powell said.
The department said it also held 15-20 meetings with community groups and outreach organizations.
DHHS is not planning to hire new staff members to assist with Medicaid enrollment. There is also no new state funding allocated to support the additional verification.
According to the Legislative Fiscal Office, the department’s budget was cut by about $19 million for the 2026 fiscal year, and by about $103 million for the 2027 fiscal year – about a 5% cut from the original $2 billion budget. Most cuts were to programming, not administration.
Gonshorowski said extra staff or funding would not be necessary.
“We do anticipate some administrative costs, but there are federal grants that were afforded specific to work requirements in H.R. 1, and we do not anticipate any part of the state cost exceeding that,” Gonshorowski said.
DHHS has a "structured internal governance process” to oversee implementation. It will track data and listen to enrollees to flag problems when they appear.
“Our current verification team already has extensive experience and expertise in determining eligibility and they are well positioned to manage this process,” Director of Communication Jeff Powell s. “The team will also complete newly developed training specific to work requirements by April 30 to ensure a smooth and effective implementation.S statement to Nebraska Public Media reads.
As work and community engagement requirements go into effect, advocates like Maresh with Nebraska Appleseed will be watching the effects on Medicaid enrollees and healthcare providers, such as increases in uncompensated care or non-emergency use of emergency rooms.
We'll also be getting things like stories from enrollment assisters and providers and hospitals and organizations who provide legal assistance and services to folks with Medicaid coverage,” Maresh said. “We attend events where people have Medicaid coverage and are able to get some of those qualitative stories about what the impacts actually are.”