Series 14: State Implementation of Work Requirements
When CMS Administrator Mehmet Oz praised Georgia’s Pathways to Coverage program in September 2025 as “a very smart path for states who are not expanding Medicaid,” he was describing a program that had enrolled roughly 8,000 people against projections of 100,000, spent $110 million doing so, and never actually enforced the work verification system it was built around. Two months later, when the One Big Beautiful Bill Act created a federal work requirement mandate effective January 1, 2027, Georgia found itself in a position no other state occupies: operating America’s only active Medicaid work requirement while simultaneously preparing for a federal mandate whose parameters may not align with the program already running.
Georgia’s experience is the most complete real-world dataset available on what happens when work requirements meet implementation reality. The lessons are not encouraging.
State Profile#
Georgia’s Pathways to Coverage program covers adults up to 100% of the federal poverty level, not the 138% FPL that defines Medicaid expansion in other states. This partial expansion structure means the program serves a smaller and poorer population than the expansion adults in states like Ohio or California. Approximately 175,000 to 240,000 Georgians fall in the coverage gap between traditional Medicaid and marketplace subsidy eligibility. Full Medicaid expansion would cover 359,000 to 440,000 uninsured residents.
The state’s 159 counties span dramatically different realities. The 29-county Atlanta metropolitan region holds 55 to 57% of the population and generates the vast majority of Pathways enrollment. Fulton County alone accounts for 1,180 people who have ever enrolled. In rural southwest Georgia, Webster and Baker counties have had zero enrollees. Of Georgia’s 159 counties, 118 are classified as rural. More than 40% had fewer than ten enrollees after a full year of operation.
The coverage gap population is approximately 45% Black, 35% white, and 12% Hispanic or Latino. Sixty percent are employed but lack employer-sponsored coverage. Only 41% of Georgia employers offer health insurance. The state follows the federal minimum wage of $7.25 per hour. Georgia’s uninsured rate of 12 to 14% ranks among the highest nationally.
Twelve rural hospitals have closed in the past decade, most in communities where Pathways enrollment is near zero. The agricultural workforce concentrated in South Georgia faces seasonal employment patterns that complicate monthly hour documentation. A growing Hispanic population, now 10.5% of the state and increasing 32% since 2010, encounters language barriers in a system designed primarily for English speakers.
Work Requirement History and Enrollment Outcomes#
Governor Brian Kemp’s administration submitted the Pathways Section 1115 waiver in November 2019, proposing partial expansion conditioned on 80 hours monthly of qualifying activity. CMS approved it in October 2020. The Biden administration sought rescission, Georgia sued, and a federal judge sided with the state in August 2022. Implementation launched July 1, 2023, coinciding with the Medicaid unwinding period, which meant state eligibility systems and staff were simultaneously processing redeterminations for existing enrollees while launching a new program with complex verification requirements.
The results have been far below projections. The state projected 100,000 enrollees in year one and achieved 4,231. By June 2025, only 13,369 Georgians had ever been enrolled, with 8,077 actively covered. By late 2025, cumulative enrollment reached approximately 15,000 ever enrolled. At current rates, reaching the state’s own five-year projection of 52,509 would take over twelve years.
The enrollment process itself created the barriers. Over 110,000 Georgians demonstrated initial interest in applying during year one, but only about half submitted complete applications. The Georgia Gateway portal proved difficult to navigate. Applicants faced steep documentation requirements including pay stubs, employer letters, and time records. Focus groups with potentially eligible Georgians revealed widespread confusion about requirements and frustration with system functionality. Despite $21 million in awareness campaign spending funded through ARPA, many eligible Georgians remained unaware of the program.
The Cost Structure#
A Government Accountability Office report released in September 2025 found that in the first 15 months, two-thirds of total Pathways spending went to administrative costs rather than healthcare. Total program expenditures through mid-2025 reached approximately $110 million, distributed roughly as follows: healthcare benefits received 31% of total spending, eligibility and enrollment technology consumed 47%, and awareness and outreach campaigns took 22%.
Per-enrollee costs reached approximately $13,597 through June 2025. Full Medicaid expansion would cost an estimated $496 per enrollee, with the federal government covering 90% rather than Georgia’s standard match of approximately 67%. The state contracted primarily with Deloitte Consulting for technology and outreach services. The technology was intended to automate verification of qualifying activities and manage monthly reporting. It largely failed to deliver workable verification systems, and the state never implemented automated audits of monthly reporting.
The comparison with North Carolina is instructive. North Carolina expanded Medicaid in December 2023 without work requirements. Within comparable periods, North Carolina enrolled 553,890 people while Georgia enrolled approximately 8,000. North Carolina achieved this with lower per-enrollee administrative costs, standard enhanced federal matching rates, and no litigation expenses. Thirty-seven percent of North Carolina enrollees live in rural counties, demonstrating that rural populations can be reached through conventional expansion.
Current Policy and Waiver Status#
The Trump administration extended Georgia’s waiver in September 2025 through December 31, 2026. The extension included significant modifications that effectively acknowledged the program’s operational failures.
Monthly reporting was eliminated. Members now report qualifying activities only at initial application and annual renewal, aligning Pathways with other Georgia Medicaid programs and recognizing that monthly verification was never enforced anyway. A caregiver exemption was added for parents and legal guardians of children under six enrolled in Medicaid. Retroactive coverage now begins on the first day of the month in which an application is received. Premium requirements that were never collected were formally dropped. Member Reward Accounts that were never operationalized were eliminated. Georgia’s reporting to CMS shifted from monthly to annual, reducing oversight and transparency.
The program essentially functions as a cumbersome enrollment gateway rather than an ongoing compliance system. Most of its distinguishing features were never implemented. Monthly work verification was required on paper but automated audits never occurred. The state did not suspend or terminate coverage based on monthly reporting failures. The October 2025 modifications formalized what had already become the operational reality.
The Dual-Policy Challenge#
Georgia’s waiver runs through December 2026, when federal work requirements under the OBBBA take effect nationally on January 1, 2027. This creates a dual-policy transition unlike anything any other state faces.
The Pathways population of adults up to 100% FPL operates under one set of rules. The federal mandate covers expansion adults up to 138% FPL, but Georgia never expanded to that threshold. Whether Georgia will align Pathways with federal parameters, seek continued waiver authority for deviations, or finally accept full expansion remains an open question.
The fiscal disparity is stark. Georgia pays roughly 34% of healthcare costs per Pathways enrollee under its standard matching rate, while expansion states pay approximately 10% under the enhanced 90% federal match. The Georgia Budget and Policy Institute has noted that Georgia will be the only state paying this disadvantageous rate for its expansion-like population. Legislation calling for full Medicaid expansion was introduced in early 2025, and alternative legislation proposed a privatized expansion model similar to Arkansas’s approach. Neither has advanced.
The CMS December 8, 2025, Informational Bulletin established federal parameters including data-first verification, a 30-day cure period before termination, and mandatory outreach beginning by December 2026. Georgia must determine how these requirements interact with its existing Pathways structure. The federal $200 million implementation funding allocation provides some resources, but Georgia’s unique position as a partial expansion state creates ambiguities about how federal parameters apply.
The semi-annual redetermination requirement under the OBBBA adds additional administrative burden. Georgia’s eligibility systems must handle more frequent renewals for whatever population falls under federal work requirement jurisdiction, alongside the ongoing Pathways administration.
What Georgia’s Experience Demonstrates#
Georgia designed a high-friction work verification system, invested over $100 million in technology and administration, and ultimately could not make it function. Rather than acknowledging failure, the state modified the program to remove the elements that were not working while maintaining the rhetorical commitment to work requirements. The October 2025 amendments represent a shift toward what might be called passive compliance, verification at enrollment and annual renewal only, broader exemptions, retroactive coverage, and no ongoing monthly monitoring.
This trajectory offers several findings for the federal mandate. Work verification systems are difficult and expensive to operate. Georgia spent 47% of program costs on technology that never delivered promised verification functions. States planning to build verification infrastructure by January 2027 must accomplish what Georgia could not in several years. Monthly reporting requirements create administrative burden without proportionate compliance benefits. Enrollment will be far below projections when barriers are high. Administrative costs dominate healthcare costs in high-friction designs.
The marketplace exclusion provision in the OBBBA compounds Georgia’s structural problem. Individuals in the coverage gap below 100% FPL already have no marketplace subsidy options, making Pathways their only potential coverage pathway. If Pathways becomes subject to more stringent federal parameters, or if Georgia’s waiver is not renewed after December 2026, this population faces the prospect of zero coverage options.
Georgia’s experience does not resolve whether work requirements can succeed. It demonstrates that the version Georgia attempted did not. Whether the implicit lessons of Georgia’s failures, visible in the October 2025 modifications that quietly abandoned most enforcement mechanisms, will inform other states’ implementation designs remains the open question as December 2026 approaches.
Cross-Program Context#
Georgia operates SNAP Employment and Training separately from Pathways. No automatic deemed compliance exists between programs, though the October 2025 waiver modifications now count SNAP compliance as a qualifying activity. Georgia’s TANF and Pathways programs operate independently with separate verification systems.
Georgia operates Georgia Access, a state-based health insurance marketplace. Enhanced ACA subsidies provide coverage options for people earning above 100% FPL, but the coverage gap population below 100% FPL has no marketplace subsidy options regardless of work requirement status.
Georgia has minimal dependence on provider taxes for Medicaid financing compared to states like New York or California, giving the state more fiscal flexibility but also meaning less pressure from hospital systems to expand coverage. The Georgia Hospital Association has supported Pathways as better than nothing but has called for full expansion to address uncompensated care costs straining the remaining rural facilities.