New Medicaid work requirements will apply to about 175,000 Coloradans

Starting in March, about 175,000 people currently covered by the Medicaid expansion in Colorado will have to meet new federal work requirements or get an exemption — though the state will more or less take their word that the requirement doesn’t apply to them for the first year.

People applying for new Medicaid coverage will need to attest that they’re working or volunteering at least 80 hours a month, enrolled in school at least part-time, or qualify for an exemption starting in January. The new requirements are part of H.R. 1, known as the “big beautiful bill,” which the Rand Corporation estimated would reduce Medicaid funding in Colorado by $267.6 million in 2028.

People enrolled under Medicaid expansion, which opened the program to adults without children earning up to 138% of the poverty line, should have received notices about the work requirements in September, with another letter scheduled for late October or early November.

Colorado and 24 other states sued to block the work requirements for new enrollees from taking effect Jan. 1. On Thursday, a federal judge issued an order throwing out federal rules for disability exemptions that went beyond the law’s text, but left the overall work requirement intact.

Other changes coming in January include reviewing enrollees’ eligibility every six months, rather than annually, and limiting healthcare providers’ ability to seek reimbursement for care they gave to patients who were eligible for Medicaid, but not enrolled.

About 377,000 of the 1.2 million people in Colorado covered by Medicaid, also known as Health First Colorado, are in the expansion population, said Adela Flores-Brennan, Medicaid director with the Colorado Department of Health Care Policy and Financing.

More than half of them aren’t subject to the work requirements, she said.

In Colorado, new applicants for Medicaid will have to show they met the work requirement the month before, while people coming up for renewal must prove they met it in at least one of the previous six months, said Marivel Klueckman, the department’s eligibility division director.

In an unknown share of cases, the state will be able to verify compliance with the requirement without talking to the enrollee. Households that earn at least $580 per month (80 hours at federal minimum wage) are deemed in compliance, and the state should be able to check that using tax records, though people doing informal jobs wouldn’t show up. At Colorado’s higher minimum wage, that would come out to about 37 hours of work per month.

People with traditional jobs will be able to sign something attesting to their hours if the state can’t verify them. Those doing gig work or in-kind work, such as odd jobs for food and shelter, will need to find some way to prove it.

People with children under 14 or who act as caregivers to someone with a disability are exempt. If the parent and child live in the same home, the state should be able to establish the relationship relatively easily, though proving caregiving could be more challenging for parents with part-time custody or people providing care to someone who lives elsewhere.

Other exemptions cover pregnancy, the first postpartum year, the initial years after a child ages out of foster care and the first months after someone leaves jail or prison.

The law exempts people with serious or complex medical conditions, including substance use disorders, blindness and disabilities that interfere with everyday activities. The federal Centers for Medicare and Medicaid Services added that the disability must interfere with a person’s ability to meet the work requirement, though it didn’t say how states should assess that. Thursday’s ruling would apparently reduce the necessary documentation for people with chronic conditions, though the Department of Health Care Policy and Financing said it is still reviewing the implications.

“The timelines to implement this large policy change are challenging; we appreciate the court’s decision,” the department said in a statement. “As requirements evolve, coordination across policy, eligibility operations and technology will be essential.”

Next year, Colorado will accept people’s word that they have a qualifying disability, but the department and stakeholders are still working out how patients will prove they should be exempt starting in 2028, Flores-Brennan said. Part of the plan is to use software to comb medical records, but it isn’t clear what share of those who are eligible the software will flag.

Because the federal government didn’t fully define who should receive a disability exemption, people with the same condition and similar levels of impairment could have different experiences from state to state, or even depending on which doctor they see. Medical records can document which conditions a person has, but doctors don’t routinely assess their patients’ ability to work, unless they specialize in determining who qualifies for Social Security disability payments.

The option to attest to a disability will ease the process in the short term, but people who have a condition that’s likely to last for years will probably want to get themselves re-categorized as eligible for Medicaid based on their condition, so they won’t have to go through the process of proving their exemption over and over, said Julie Reiskin, co-executive director of the Colorado Cross-Disability Coalition.

Reiskin said she worries most about people whose disability affects focus, task management and similar cognitive functions. For them, paperwork is a major challenge, particularly if they don’t have a family member who can help them document their work or their exemption, she said.

“Those are the people I’m losing sleep over,” she said.

The state seems to be trying to make the process as easy as possible, but some people likely will fall through the cracks, Reiskin said. Healthcare providers will have to work to fill in the gaps and connect their patients with care coordinators to help navigate the system, she said.

Kelly Daughtery, executive vice president of service delivery operations at Clinica Family Health and Wellness, said the group of safety-net clinics has been working with a vendor to set up online resources to help people navigate the new Medicaid processes. They have enrollment specialists and plan to train their providers and support staff to help, but simply don’t have the ability to walk every affected individual through the process, he said.

Clinica’s patients generally know that Medicaid changes are coming, but aren’t sure what they’ll need to do, Daughtery said. He estimated the state, patients and providers will need 18 to 24 months to find and fix bugs in the process.

“People are going to be confused and people are going to have questions,” he said.

In Nebraska, which implemented the work requirement in May, about 14% of new applicants and 7% of those renewing their coverage were denied because they didn’t meet the requirement or receive an exemption. The majority of those denied didn’t fill out the paperwork, so no one knows how many truly qualified.

Unhoused people are going to be at particular risk of falling through the cracks, since they may not receive the state’s messages about the work requirements, said Cathy Alderman, chief communications and public policy officer at the Colorado Coalition for the Homeless.

The population they work with generally has more health needs than housed people, both because severe illness is one factor that pushes people into homelessness and because living on the street can cause new medical problems, she said.

The coalition’s clinics are notifying patients and developing procedures to help them either document their work or apply for an exemption, but people who rarely seek care could be surprised to find out they no longer have Medicaid coverage when they do eventually come in, Alderman said.

“It’s really scary for those folks, because those folks are already the most vulnerable,” she said.

In addition, Medicaid is the major payer for the coalition’s clinics, so they could have to limit care to uninsured patients to make up for declining revenue if too many people lose coverage, Alderman said.

Ultimately, it doesn’t serve anyone if eligible people lose coverage, because their health will get worse, leaving them less able to work and forcing providers to offer uncompensated care, Reiskin said.

“No one wants to be poor, so if people can work, they generally do,” she said.

____