Trump Administration Finalizes Rule Tightening Medicaid Work Requirement Medical Exemptions
The Trump Administration finalized a rule that restricts medical frailty exemptions from the Medicaid work requirement enacted in the 2025 reconciliation law. The rule narrows exemptions for blindness, disability, substance use disorder, disabling mental disorders, and physical, intellectual, or developmental disabilities that impair ability to perform daily activities. The work requirement takes Medicaid coverage from enrollees who do not meet the requirement and do not qualify for an exemption. The rule is now in effect following finalization.
Medicaid MCOs will face increased disenrollment of members who cannot meet work requirements or qualify for narrowed medical exemptions, affecting revenue, medical loss ratios, and administrative burden related to exemption verification and member appeals.
Managed Care
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