Series 14: State Implementation of Medicaid Work Requirements
On May 14, 2025, a month before the One Big Beautiful Bill Act became law, Angie Garcia told a Utah Department of Health and Human Services public hearing about her daughter Aramina, who is five years old and lives with Apert syndrome. Medicaid paid for the hand surgery that gave Aramina functional use of her fingers. Aramina wants to become a veterinarian. Garcia did not testify about work requirements in the abstract. She testified about what happens when bureaucratic conditions separate children and families from the coverage that makes surgery possible, therapy accessible, and futures imaginable.
A few speakers later, Marcella Patino, a nail salon worker already navigating SNAP and child care work requirements, described the “constant stress and uncertainty” of proving compliance across multiple programs simultaneously. Bill Tibbitts of the Crossroads Urban Center was more direct: “People who are homeless and working out of their car do not need extra negative incentives. Threatening to take away people’s healthcare if they do not do a bunch of busywork is not really helpful.”
What none of the speakers at that May hearing could have known was that within weeks, a provision buried deep in the OBBBA would transform Utah’s work requirement debate from a policy discussion into an existential fiscal crisis. The law’s FMAP penalty for states covering noncitizens through the State Children’s Health Insurance Program would collide with a Utah trigger statute in a way that forces state leaders to choose between healthcare for 2,000 immigrant children and healthcare for 75,000 expansion adults. Medicaid Director Jennifer Strohecker would later acknowledge that the FMAP penalty “would trigger a law to ’terminate’ Utah’s adult Medicaid expansion program.” Dr. William Cosgrove, writing in the Deseret News, named the dilemma precisely: Utah’s legislature now faces its own “Sophie’s choice.”
From Ballot Box to Legislative Override#
Utah’s path to this moment began at the ballot box. In November 2018, voters approved Proposition 3 by a margin of 53% to 47%, mandating full Medicaid expansion to 138% of the federal poverty level under the Affordable Care Act. The measure did not include work requirements. It did not include enrollment caps. Voters approved straightforward expansion.
The Utah Legislature disagreed with voters. In February 2019, it passed Senate Bill 96, modifying Proposition 3 in ways that fundamentally altered what the electorate had approved. SB 96 initially limited expansion to 100% FPL pending federal waiver approval, added work requirements for adults ages 19 to 59, included enrollment caps if costs exceeded projections, and conditioned full expansion on CMS approving an 1115 waiver incorporating these modifications. Courts upheld the legislature’s authority to rewrite the initiative. Utah is one of 11 states with no restrictions on legislative modification of voter-approved ballot measures, making Proposition 3 an expression of voter preference rather than a binding constraint on legislative action.
The state submitted its Section 1115 waiver in March 2019 seeking approval for full expansion with work requirements, enrollment caps, and premium requirements for higher-income enrollees. The work requirement design was notably moderate: 48 hours monthly of qualifying activities, well below what would become the federal 80-hour standard. Verification relied on self-attestation with documentation available for audit rather than upfront proof. CMS approved the waiver in part, but work requirements were never implemented. Federal litigation outcomes in Arkansas and Kentucky created legal uncertainty through 2019, and the pandemic’s continuous enrollment requirement suspended any implementation from March 2020 onward. Utah completed Medicaid unwinding in 2023 and 2024 and returned to normal eligibility processes, but work requirements remained a theoretical authorization rather than an operational reality.
The July 3 Filing and the Pathway Pivot#
On July 3, 2025, one day before President Trump signed the OBBBA into law, Utah submitted a new 1115 waiver amendment to CMS. The timing was not coincidental. The state had been preparing for months, holding the May 14 public hearing to fulfill federal notice requirements, and filed just before the federal landscape shifted beneath it.
The filing sought to align Utah’s existing waiver authority with anticipated federal requirements. But the OBBBA changed the calculus. The federal law mandates 80 hours monthly of work, education, training, or qualifying activities for all expansion adults, imposes semi-annual redetermination cycles, and requires participation verification before enrollment rather than the enrollment-before-compliance approach Utah had originally proposed. These are not minor technical differences from Utah’s 2019 design. They represent a fundamentally different relationship between the state, its members, and the verification infrastructure required to connect them.
By early 2026, evidence suggests Utah may be abandoning the waiver pathway entirely. Ballotpedia reported in January 2026 that “Utah requested a work requirement waiver, but the state has since indicated that it will no longer be moving ahead with the waiver process.” KFF noted that several states, including Utah, “may no longer be moving forward with proposed 1115 waivers because they plan to implement early through a state plan amendment.” This mirrors Montana’s pivot from a waiver to a state plan amendment after CMS issued implementation guidance clarifying that the OBBBA’s statutory requirements could be implemented through simpler administrative pathways.
The distinction matters operationally. An 1115 waiver involves negotiation with CMS, public comment periods, evaluation requirements, and periodic renewal. A state plan amendment is a more straightforward administrative filing. For a state that submitted its waiver one day before the law changed, the pivot reflects practical acknowledgment that the federal mandate superseded the state-specific negotiations Utah had been pursuing.
The FMAP Trap#
Utah’s work requirement challenge is inseparable from a larger fiscal crisis that makes the state’s position unique among expansion states. The OBBBA includes a provision reducing the enhanced Federal Medical Assistance Percentage from 90% to 80% for any state that uses federal Medicaid or CHIP funds to cover noncitizen populations. Utah covers approximately 1,317 children, with capacity for 2,000, through its State CHIP program regardless of citizenship status. This coverage now carries an extraordinary price tag.
Utah Code Section 26B-3-210(5) contains a trigger provision that terminates the state’s Medicaid expansion program “no later than the next July 1” if the enhanced FMAP drops below 90%. The law was written as a fiscal safeguard, ensuring the state would not bear increased costs if federal support diminished. But the OBBBA has transformed this safeguard into a trap. If Utah continues covering noncitizen children through State CHIP, the federal FMAP penalty reduces expansion funding from 90% to 80%, which triggers the state statute, which terminates coverage for all 75,000 expansion adults.
The arithmetic is devastating. KFF estimates the FMAP penalty alone would cost Utah $924 million over ten years. But the real cost is not financial. It is the forced choice between two vulnerable populations. Representative Jim Dunnigan, a Republican, captured the fiscal reality: “We cannot afford, monetary-wise or policy-wise, to see our federal expansion funding cut.” Matt Slonaker of the Utah Health Policy Project framed the game theory: “a prisoner’s dilemma, a move in either direction does not make much sense.”
Utah could eliminate State CHIP coverage for noncitizen children, preserving the 90% FMAP and maintaining expansion. This sacrifices 2,000 children who are, by definition, among the most vulnerable people in the state. Or Utah could maintain children’s coverage and accept the FMAP reduction, which triggers the statutory termination of expansion and removes 75,000 adults from Medicaid. Or the legislature could amend the trigger statute, accepting the 80% FMAP and absorbing the additional state costs, but this requires affirmative legislative action in a political environment where Medicaid spending is already under scrutiny.
This fiscal crisis operates independently of work requirements but profoundly shapes the work requirement conversation. If the trigger statute fires and expansion terminates, work requirements become moot for the terminated population. If the legislature amends the statute to preserve expansion at 80% FMAP, the increased state cost share creates pressure to reduce the expansion population through aggressive work requirement enforcement. The FMAP trap does not merely complicate Utah’s work requirement planning. It threatens to render the entire discussion academic.
Who Actually Needs to Comply#
Understanding who would face work requirements in Utah requires looking past aggregate enrollment numbers to the population’s actual composition. As of August 2025, approximately 72,000 adults were enrolled in Medicaid through expansion, down from earlier estimates of 90,000 to 120,000 following the pandemic unwinding. Utah’s expansion population is the youngest of any expansion state: 48% are between 19 and 34, 30% between 35 and 49, and 22% between 50 and 64. This age distribution reflects Utah’s overall demographics, including the large Latter-day Saint population with higher birth rates and younger household formation patterns.
The critical statistic came from Nate Crippes of the Disability Law Center, who noted during the May public hearing that 60% of the expansion population has a mental illness or substance use disorder. Advocacy organizations estimate that 90% of expansion adults would qualify for exemptions, meaning only approximately 7,500 people would actually be subject to work requirements. Stephanie Burdick, a health advocate who testified at the hearing, identified the core problem: these individuals are largely already exempt, “but how they prove that they’re exempt is where it becomes an administrative burden.”
This is the verification paradox that Arkansas demonstrated in 2018 and that every subsequent state analysis has confirmed. In a state with 2.5% to 3.0% unemployment and a workforce struggling to fill positions, almost everyone who can work is already working. The expansion adults who are not working are overwhelmingly people who cannot work due to disability, mental illness, substance use disorders, caregiving obligations, or other circumstances that qualify for exemptions. Work requirements in this context do not incentivize employment. They create documentation requirements for people whose exemption status is clinically or circumstantially obvious but administratively difficult to prove.
The Cultural Infrastructure Gap#
Utah’s dominant Latter-day Saint culture shapes the work requirement landscape in ways that are both supportive and exclusionary. LDS theology and institutional practice emphasize self-sufficiency and productive work. The Church operates its own welfare system, centered on Welfare Square in Salt Lake City, that conditions assistance on work and service. Ward and stake structures provide informal community support networks that can help members navigate bureaucratic requirements, share information about compliance deadlines, and connect with resources. For LDS expansion enrollees, work requirements may feel culturally familiar, even comfortable, echoing institutional practices they already participate in.
The problem is that the populations most likely to struggle with work requirement compliance are precisely those least likely to have access to LDS community infrastructure. Salt Lake City hosts significant refugee resettlement populations from Burma, Congo, Syria, and other nations. These communities face language barriers that make English-language verification systems nearly impenetrable, employment documentation challenges in industries like meatpacking, hospitality, and janitorial services where informal practices make employer verification difficult to obtain, and cultural unfamiliarity with American administrative assumptions about how government programs function.
Resettlement agencies including Catholic Community Services, the International Rescue Committee, and Lutheran Immigration and Refugee Service provide navigation support, but their capacity to scale to work requirement verification for thousands of additional enrollees is uncertain. The Pacific Islander communities in the Salt Lake Valley, predominantly Tongan and Samoan, face similar cultural and linguistic navigation challenges. And Utah’s tribal populations across the Navajo Nation, Ute Mountain Ute, Uintah and Ouray reservations, and Paiute and Goshute lands present the same verification complications as tribal populations in Arizona and Montana: distinctive employment patterns, sovereign governance structures, and geographic isolation that standard compliance systems cannot accommodate.
The cultural infrastructure gap means that Utah effectively operates two compliance environments. Along the Wasatch Front, where 80% of the population lives and institutional support networks are dense, work requirement compliance may function relatively smoothly for an already-employed population. In rural Utah, on tribal lands, and within refugee and immigrant communities, the same requirements create fundamentally different burdens.
The Managed Care Patchwork#
Utah’s managed care infrastructure adds another layer of complexity. The state operates multiple delivery models across different geographies. Utah Medicaid Integrated Care plans serve the five largest counties: Davis, Salt Lake, Utah, Washington, and Weber. Accountable Care Organizations cover enrollment in Box Elder, Cache, Iron, Morgan, Rich, Summit, Tooele, and Wasatch counties. Prepaid Mental Health Plans deliver behavioral health and substance use disorder services in non-UMIC counties. And 16 rural counties, including Beaver, Carbon, Daggett, Duchesne, Emery, Garfield, Grand, Juab, Kane, Millard, Piute, San Juan, Sanpete, Sevier, Uintah, and Wayne, operate under fee-for-service arrangements.
This patchwork means that work requirement verification support will vary dramatically depending on where an enrollee lives and which delivery model covers their care. UMIC plans in the urban corridor have the organizational infrastructure to deploy care coordinators, flag members at risk of non-compliance, and coordinate with the Department of Workforce Services. Rural fee-for-service counties have no managed care entity to perform these functions. The verification burden falls directly on enrollees and on a county-level infrastructure that, in places like Piute County with fewer than 2,000 residents, barely exists.
Utah’s Standard Plans launched in July 2021 and are still maturing. Adding work requirement verification to managed care organizations that are themselves relatively new creates implementation risk that would not exist in states with more established managed care relationships.
The ESI Complication#
Utah adds a layer of complexity that no other expansion state shares. Expansion adults who have access to employer-sponsored insurance are required to enroll in that coverage. Medicaid then reimburses their premiums and covers co-pays and deductibles that the employer plan does not. Failure to enroll in required ESI results in loss of Medicaid expansion eligibility.
This creates a two-stage compliance requirement unique to Utah. An expansion adult who works for an employer offering health insurance must first enroll in the employer’s plan, then maintain work requirement compliance to retain the Medicaid wrap-around coverage that makes the employer plan affordable. The verification infrastructure must track both ESI enrollment status and work activity hours, and a failure in either domain can result in coverage loss. For workers in seasonal industries, or those whose employer coverage changes during open enrollment periods, the interaction between ESI requirements and work requirements creates administrative complexity that other states’ systems need not address.
The Department of Workforce Services Advantage#
One structural advantage Utah possesses is its unusual administrative architecture. Medicaid eligibility determination sits within the Department of Workforce Services rather than a health agency. This integration means the same agency that processes SNAP benefits, administers TANF work requirements through the Family Employment Program, and operates workforce development programs also determines Medicaid eligibility.
The state has explicitly signaled its intent to leverage this integration. Utah’s waiver documentation indicated plans to “align closely with Utah’s work requirements and activities of the SNAP program work activities to ensure consistency and reduce complexity.” Deemed compliance provisions, where meeting SNAP work requirements automatically satisfies Medicaid requirements, could reduce duplicate verification burden for the overlapping population.
But the integration carries risk as well. When Medicaid eligibility lives within a workforce agency rather than a health agency, the institutional culture may prioritize employment outcomes over healthcare access. A September 2025 audit found that the office tasked with monitoring Utah Medicaid “failed to provide effective oversight,” a finding that raised questions about whether the administrative capacity to implement work requirements competently actually exists, regardless of the structural advantages the institutional arrangement provides.
The Legitimacy Wound#
Beneath all of Utah’s specific implementation challenges lies a legitimacy wound that distinguishes this state from every other. Voters approved Medicaid expansion without work requirements. The legislature overrode voters and added work requirements. The courts upheld the legislature’s authority. The question of democratic legitimacy remains unresolved.
The Protect Medicaid Utah coalition, which includes the Crossroads Urban Center, the Disability Law Center, the Utah Health Policy Project, and other organizations, traces its opposition to work requirements directly to the Proposition 3 campaign. Former Republican Representative Marsha Judkins of Provo, who attended the May 14 public hearing, told reporters that what she heard “broke my heart” and that she “felt like I needed to come and engage.” When a Republican former legislator attends a public hearing to express concern about a policy her own party championed, the political terrain is more contested than supermajorities suggest.
Whether this legitimacy tension translates into member non-cooperation, legal challenges, or merely background political noise depends on how implementation unfolds. But it shapes the environment in which every compliance letter is sent, every exemption form is processed, and every coverage termination is executed.
What Comes Next#
Utah enters 2026 facing a cascading set of uncertainties unlike those in any other expansion state. The FMAP trap may terminate expansion entirely before work requirements take effect. The implementation pathway has shifted from a negotiated waiver to what appears to be a state plan amendment. The managed care infrastructure is fragmented across multiple delivery models at varying stages of maturity. The enrollment population is smaller than earlier estimates suggested, with a majority already exempt from requirements they may struggle to document.
The state’s strongest asset is the Department of Workforce Services integration, which provides a structural foundation for cross-program coordination that most states lack. Its deepest vulnerability is the trigger statute that converts a federal penalty designed to restrict noncitizen coverage into an existential threat to the entire expansion program.
Aramina Garcia, the five-year-old who wants to become a veterinarian, does not appear in any compliance database. Her mother’s testimony does not generate a case number. But the system that paid for Aramina’s hand surgery depends on the same fiscal and administrative infrastructure that work requirements are about to stress in ways that no one fully understands. Whether Utah navigates that stress through competent administration or collapses under the weight of compounding federal mandates, fiscal triggers, and verification demands will determine outcomes for tens of thousands of people whose lives are far less visible than the policy debates that govern them.