Big, Beautiful Work Requirements

The federal Medicaid program was designed to help pregnant women, the disabled, and children. But today, it has become overrun with able-bodied, unemployed adults. Although Medicaid programs are administered by state governments, they are funded by federal tax dollars. This translates to a $12,100 cost per beneficiary paid by the American taxpayer. Roughly 62% of the able-bodied adults on Medicaid are not working, volunteering, or getting an education. Astoundingly, a plurality (35.9%) of all Medicaid spending is on able-bodied adults. That means a significant portion of the $12,100 each taxpayer is paying is going towards people who could work, but choose not to. This problem will finally be addressed through work requirements. A study conducted by the Office of the Assistant Secretary for Planning and Evaluation calculated that Medicaid work requirements could increase family net income by $12,034 and reduce poverty for Americans by 1.6 million to 2.9 million. This calculation projects that if these work requirements are effectively implemented by states, then they will significantly reduce poverty by promoting economic growth and labor force participation.

The Centers for Medicare & Medicaid Services released an interim rule, in accordance with the Working Families Tax Cut of 2025, that clarifies the law’s requirement for certain adult Medicaid applicants and enrollees to meet an 80 hours per month work requirement through employment, education, work programs, or community service. The Cato Institute reports that this reform will reduce $325 billion in Medicaid spending, which allowed Congress to relieve the tax burden on everyday Americans.

The CMS rule contains necessary guardrails around who qualifies as “medically frail” and thus is exempt from these work requirements. Someone who is “medically frail” is anyone with a serious medical condition or disability that significantly impairs their ability to live or comply with the work requirements. On top of this new definition, states must require documentation when it is available to prove if someone is medically frail, starting January 1st, 2028. Through 2027, states may accept self-assessment when reliable data isn’t available.

Work requirements for certain federal aid programs already exist and have shown to work in incentivizing employment and economic growth. Temporary Assistance for Needy Families (TANF) requires a minimum of 20 to 35 hours per week, depending on family structure and age of the youngest child to receive benefits. Research from the National Evaluation of Welfare-to-Work Strategies found that work requirements increased employment by 4.2 percentage points in the first 5 years. Another study done in Charlotte, North Carolina, found that enforcing work requirements for public housing residents for at least 15 hours per week resulted in the employment rate rising from 58% to 88%. This tangible evidence shows that work requirements are effective in increasing employment at both the local and national level.

Federal taxpayers spend more on Medicaid for able-bodied adults than they do for seniors, individuals with disabilities, and children. But work is plentiful, and an entry-level job would pay more than $15 an hour on average across the country. An able-bodied adult would only have to work 19 hours a week to lift themselves over the poverty line. Further, work requirements can also be met by receiving any kind of education, learning a trade, or volunteering at a soup kitchen. There is no reason an able-bodied adult without young children couldn’t meet these requirements. 

Food stamp work requirements have led to able-bodied adults leaving welfare to join the workforce in more than 1,000 industries and doubling their previous incomes within a year and tripling them within two. On top of this, the higher wages offset any lost welfare benefits. The able-bodied adults being pulled out of welfare programs due to work requirements start to contribute to the economy; this is a win for the American taxpayer and a win for those who pulled themselves out of a difficult situation.

Medicaid was designed as a bridge to temporarily assist those that genuinely need it. But it has been abused by able-bodied adults who are capable of employment. Work requirements not only work, but they also restore the original purpose of Medicaid. Work requirements also help relieve the taxpayer burden that Medicaid causes because, as of right now, a large portion of Medicaid money is going to able-bodied adults. The Working Families Tax Cut of 2025, along with the recent, strong CMS guidance, will deliver relief to American taxpayers, reduce poverty, and restore the intent of Medicaid.