The federal government approved a “temporary hardship exemption” from new Medicaid work requirements Friday for Dawson County due to high unemployment.
Lexington, the county seat, has faced economic hardship since the Tyson Foods meatpacking plant closed in January. About 3,000 employees lost their jobs.
Exemptions to Medicaid work requirements are federally permitted if counties have an 8% or higher unemployment rate. Dawson County’s unemployment rate is nearly twice as high at 15.5%, according to May 2026 data from the Nebraska Department of Labor. The statewide unemployment rate is 3%.
The exemption will remain in effect until the unemployment rate dips below 8% – or 1.5 times the national average if it is lower.
In early June, Gov. Jim Pillen directed the Nebraska Department of Health and Human Services to seek the exemption from the federal Centers for Medicare and Medicaid Services.
Medicaid work requirements started in Nebraska on May 1, 2026, for most able-bodied adults under the “Medicaid Expansion” population. New enrollees are subject to the requirements whenever they apply, and current enrollees must comply by their next recertification to keep their coverage.
Nebraska was the first state to implement the federally mandated requirement from last year’s “One Big Beautiful Bill Act.” All states are required to comply by Jan. 1, 2027.
Some advocates for Medicaid recipients worry that work requirements could cause administrative burdens for the state and enrollees, causing confusion and loss of coverage for Nebraskans who need it. Nebraska DHHS says it has responded to concerns by conducting outreach, working closely with CMS and providing additional training to staff.