Section 1115 Medicaid demonstration waivers offer states an avenue to test new approaches in Medicaid that differ from what is required by federal statute, if [in the HHS Secretary’s view] the approach is likely to “promote the objectives of the Medicaid program.” They can provide states additional flexibility in how they operate their programs, beyond the considerable flexibility that is available under current law. Waivers generally reflect priorities identified by states as well as changing priorities from one presidential administration to another. Nearly all states have at least one active Section 1115 waiver and some states have multiple 1115 waivers. This brief explains what Section 1115 waivers are and how they are used, summarizes key waiver requirements, and outlines the application and approval process.

What are waivers and how are they used?

Authority & Purpose. Under Section 1115 of the Social Security Act, the Secretary of Health and Human Services (HHS) can waive certain federal Medicaid requirements.¹  In addition, the Secretary may permit states to use federal Medicaid funds in ways that are not otherwise allowed. Each administration has some discretion over which waivers to approve and encourage (Table 1). While the Secretary’s waiver authority is broad, it is not unlimited. Section 1115 waivers have been challenged in court. The Secretary does not have authority to waive some elements of the program, such as the federal matching payment system for states, or requirements that are rooted in the Constitution, such as the right to a fair hearing.² 

Waiver Scope/Use. Waivers have been used to expand coverage or benefits, change policies for existing Medicaid populations (e.g., testing premiums or other eligibility requirements), modify delivery systems, restructure financing or authorize new payments (e.g., supplemental payments or incentive-based payments), as well as make other program changes. Waivers vary in size and scope. States can obtain “comprehensive” Section 1115 waivers that make broad program changes or narrow waivers focused on a specific population. Some policies introduced through 1115 waivers can only be implemented through Section 1115 authority while others could be implemented under other authorities (e.g., State Plan authority or 1915(c)). MACPAC analysis found about half of all Medicaid spending (in FY 2019) was authorized under Section 1115 demonstrations, but most of that spending could have been covered without an 1115 waiver. States may seek to include some populations or services in Section 1115 waivers that could be covered under other authorities to capture “budget neutrality” savings (discussed in more detail below). For example, although states can implement mandatory managed care for most populations under other authorities (e.g., State Plan or 1915(b)), states may implement managed care under 1115 authority to show budget neutrality savings, which can be used to finance other waiver costs that are not otherwise covered / allowed by Medicaid. In addition, many states have comprehensive waivers that make broad and intertwined program changes and may include both provisions that require 1115 authority as well as provisions that could be implemented without a waiver.

What are the rules about waiver financing?

Financing. Under long-standing policy and practice (although not required by statute), waivers must be “budget neutral” to the federal government over the course of the waiver. In other words, federal costs under an 1115 waiver may not exceed what they would have been for that state without the waiver. Typically, budget neutrality calculations are determined on a per enrollee basis—so, per enrollee spending over the course of the waiver cannot exceed the projected per enrollee spending calculated in the “without-waiver baseline” (putting states at risk for the costs per individual but not for the number of individuals enrolled). Waiver budget neutrality—measured against the estimated without-waiver baseline over the entire demonstration period—is not the same as a federal per enrollee limit on spending set at rates lower than expected under current law to generate federal savings. Budget neutrality calculations and the use of “budget neutrality savings” (to fund the federal share of costs not otherwise allowed) are negotiated between states and CMS (and the Office of Management and Budget (OMB)).

Because Section 1115 budget neutrality is not defined in statute or regulations, CMS agency policy and guidance to states has changed over time. For example, the Trump administration made changes to 1115 waiver budget neutrality policy in 2018, limiting the amount of federal funds that could be used for waiver spending. Later, the Biden administration made changes to Section 1115 budget neutrality policies that could provide greater flexibility for states to design and implement 1115 demonstration programs, including health-related social needs initiatives.

What are waiver timelines and processes?

Waiver Timeframe. Section 1115 waivers generally are approved for an initial five-year period and can be renewed, typically for three-to-five-year periods. Some waivers have been continually renewed over many periods, allowing waiver operations to continue for many years. Under the Trump administration, in a departure from prior policy, CMS approved waiver extension requests for up to 10 years.

Incoming administrations may let waivers expire, choosing not to renew certain waiver provisions if they don’t align with the administration’s waiver priorities or if they determine the provisions do not promote the objectives of the Medicaid program. Additionally, outlined in waiver approval terms and conditions, CMS reserves the right to withdraw Section 1115 waiver or expenditure authorities at any time (including those already in operation under an active/approved waiver). The Biden administration withdrew Medicaid work requirement waivers in all states that had approvals, concluding that the provisions do not promote the objectives of the Medicaid program. States can appeal withdrawal decisions to the HHS Department Appeals Board and/or challenge recissions in court.

Transparency, Public Input, and Evaluation. The Affordable Care Act (ACA) made Section 1115 waivers subject to new rules about transparency, public input, and evaluation.³  Regulations require public notice and comment periods to occur at the state and federal levels before CMS approves new Section 1115 waivers and extensions of existing waivers. Although the final regulations on public notice do not require a state-level public comment period for amendments to existing/ongoing demonstrations, CMS has historically applied these regulations to amendments as well. The Trump administration did not enforce state-level public notice and comment procedures maintained by previous administrations for certain 1115 waiver requests, including waivers that proposed significant changes.

The ACA also implemented new evaluation requirements for Section 1115 waivers, including that states must have a publicly available, CMS-approved evaluation strategy. States have traditionally also been required to submit quarterly reports as well as an annual report to HHS that describes the changes occurring under the waiver and their impact on access, quality, and outcomes.

Waiver Application, Monitoring, and Evaluation Process. Medicaid policy changes, including through Section 1115 waivers, may require state legislative action or may be authorized at the direction of the governor. Once proposed policy changes have been formulated, a demonstration waiver proposal must be drafted. Key steps in the waiver process include (Figure 1):

• State public notice and comment.⁴  Prior to submitting an 1115 waiver application (or extension request) for official federal review, states must provide a 30-day public notice and comment period and must hold at least two public hearings, sharing sufficient detail about the proposed waiver to allow for meaningful public input. The state must share waiver proposal materials on its website. Federal rules also require tribal consultation (with federally recognized tribes) prior to application submission.
• Waiver application submission. State waiver applications must contain specific components including a comprehensive description of the demonstration, enrollment estimates (including for each category of beneficiaries impacted by the demonstration), a list of specific requested waiver and expenditure authorities, research hypotheses, and written documentation of the state’s compliance with public notice requirements, with a report of the issues raised and how the state considered those comments when developing the application.
• Federal public notice and comment.⁵  The federal government conducts a review for application completeness and sends the state a notice of receipt, indicating the start date of a 30-day federal comment period. CMS will publish the waiver application on its website and must make the comments received publicly available. Rules require CMS to review and consider all comments submitted by the deadline.
• Federal review and negotiation. CMS reviews the waiver application sometimes with the involvement of other HHS agencies and the Office of Management and Budget (which reviews the budget neutrality component). Significant negotiation may occur between the state and HHS.
• Approval. If a waiver is approved, CMS issues an award letter to the state (also published on Medicaid.gov), listing the specific sections of the Social Security Act and applicable regulations that are being waived or modified and the types of expenditures allowed as well as the “terms and conditions” of approval, including a budget neutrality agreement. There has been significant variation in the length of time it takes to get final approval of a waiver. NAMD has noted the typical negotiation / approval timeframe ranges from 6 months to 2 years.
• Implementation plans and protocols. For some waiver initiatives, CMS may require states to submit detailed implementation plans or protocol documents for review and approval.
• Monitoring & Evaluation.^6 ,7  Because Section 1115 authority is intended for research and demonstration purposes, states must have an approved evaluation strategy in place that is publicly available. States are required to submit an interim evaluation report (one year before a waiver’s expiration or with a renewal application) and a summative evaluation (due 18 months after a waiver period ends). States have traditionally also been required to submit quarterly reports as well as an annual report to HHS that describes the changes occurring under the waiver and their impact on access, quality, and outcomes. States must also hold public forums to solicit feedback following waiver approval / implementation.
• Amendments & Renewals. States may submit “amendment” requests to CMS to alter existing / ongoing 1115 demonstrations. To ensure public transparency, CMS has historically required states to follow public notice and comment rules (even though final regulations left open the applicability of public notice requirements to proposed amendments). Extension / waiver renewal requests must contain specific components enumerated by CMS, including evaluation results.

*State waiver applications (including amendment and renewal requests), CMS issued approval documents, required implementation plans and protocols, and monitoring and evaluation reports are made publicly available on Medicaid.gov (search by state).

1. 42 U.S.C. § 1315. ↩︎
2. The Secretary’s waiver authority is limited to the provisions of 42 U.S.C. § 1396a, provided that waivers are demonstration projects that further Medicaid program objectives. 42 U.S.C. § 1315. ↩︎
3. [3] §10201(i) of P.L. 111-148 added a new subsection (d) to Section 1115 of the Social Security Act. CMS issued final regulations implementing these provisions of the ACA (42 CFR Part 431 where a new Subpart G is added). ↩︎
4. § 431.408 ↩︎
5. §431.416 ↩︎
6. §431.424 ↩︎
7. §431.428 ↩︎

At the start of 2025, many issues are at play that could affect Medicaid coverage, financing, and access to care. Medicaid is the primary program providing comprehensive health and long-term care to one in five people living in the U.S. While Medicaid was not discussed much on the campaign trail, there are expectations that big changes will likely be proposed through executive actions by the Trump administration and as part of a tax and spending debate in Congress. Even without Congressional action, the Trump administration can make significant programmatic changes through administrative action (including state demonstration waivers, regulations, and other guidance). Other areas to watch with Medicaid implications include state budgets and long-term care workforce challenges.

Federal Funding Cuts and Financing Reforms

The most significant changes to Medicaid in 2025 could include federal funding cuts and financing reforms. According to documents reported on by Politico, House Republicans are considering $2.3 trillion in Medicaid cuts from policy changes that include: imposing a per capita cap on federal Medicaid spending, reducing the federal government’s share of costs for the Affordable Care Act (ACA) expansion group, imposing Medicaid work requirements, reducing the minimum federal matching rate for Medicaid expenditures, changing the match rate for the District of Columbia, and repealing the incentive for states to newly adopt the Medicaid expansion that was passed in the American Rescue Plan Act. These policy changes would fundamentally alter how Medicaid financing works and federal spending reductions of this magnitude would put states at significant financial risk, likely forcing them to cut the number of people covered, cover fewer benefits, and cut payment rates for physicians, hospitals, and nursing homes. If the House and Senate pass a budget resolution with a $2.3 trillion target for Medicaid, Congress will need to come up with detailed legislative policy proposals to hit that target through the budget reconciliation process.

Under current law states are guaranteed federal matching dollars without a cap for qualified services provided to eligible enrollees. The match rate (the share that the federal government pays, known as the federal medical assistance percentage or “FMAP”) varies across states based on per capita income. States receive a higher match rate for some services and populations, most notably, the 90% enhanced match for the ACA expansion population, and sometimes, Congress adjusts the match rate upwards during economic downturns.

Work Requirements

With a second Trump administration and Republican control of Congress, work requirements are likely to be back on the agenda—through federal legislation or state Medicaid waivers. During the first Trump administration, 13 states received 1115 waiver approval to condition Medicaid coverage on meeting work and reporting requirements. Only Arkansas implemented work and reporting requirements with consequences for noncompliance; however, the waiver ended in 2019 when a federal court found the work requirement approval unlawful. 18,000 people lost coverage in Arkansas, primarily due to failure to regularly report the fact that they were working or document eligibility for an exemption. These approvals were either rescinded by the Biden administration or withdrawn by states, and Georgia is the only state with a work requirement waiver in place (following litigation over the Biden Administration’s attempt to stop it). Several states have continued to pursue work requirement waivers despite data showing that most Medicaid adults are working or face barriers to work. Among adults with Medicaid who are under age 65 and do not have Medicare or Supplemental Security Income (SSI), 91% are working, or are not working due to an illness, caregiving responsibilities, or school attendance. A Congressional Budget Office analysis of a recent work requirement proposal shows that the policy would reduce federal spending due to reductions in enrollment and increase the number of people without health insurance but would not increase employment.

Other Waivers and Administrative Changes

Beyond work requirements, the previous Trump administration’s Section 1115 waiver policy emphasized eligibility restrictions and capped financing. Eligibility restrictions included permitting states to charge premiums and lock out enrollees who are disenrolled for unpaid premiums. Waiver priorities shift across presidential administrations and the new Trump administration’s waiver priorities will likely differ significantly from those of the Biden administration; however, it is unclear how the Trump administration will treat certain waivers promoted and approved by the Biden administration, such as those focused on addressing health-related social needs, multi-year continuous eligibility primarily for children, and leveraging Medicaid to help individuals leaving incarceration transition to the community. The Trump administration could choose not to approve waivers that remain pending, rescind existing waiver guidance, and withdraw approved waivers, although some of these waivers, particularly those that are using Medicaid to assist with reentry from incarceration, have been pursued by both Republican and Democratic governors.

Trump administration could delay implementation of new regulations or issue new rules or guidance related to access, managed care, and enrollment processes. The Biden administration finalized a number of major Medicaid regulations designed to promote quality of care and advance access to care for Medicaid enrollees as well as to streamline eligibility and enrollment processes in Medicaid and the Children’s Health Insurance Program (CHIP). These rules are complex and are set to be implemented over several years. Congress may consider legislation to overturn these rules, without legislation, the Trump administration could delay implementation of certain provisions or could issue new regulations that would undo these final rules. (Rules related to long-term care are discussed below). Finally, the Trump administration could issue guidance and implement policy to make it more difficult for people to obtain and maintain coverage, which would reduce enrollment and spending. Previously, the Trump administration sought to reduce Medicaid enrollment by encouraging states to conduct eligibility verification processes in between annual renewal periods.

State Budget Constraints and Priorities

State fiscal conditions remained stable at the beginning of state FY 2025, but the longer term fiscal outlook is less certain. Heading into FY 2025, revenue collections had begun to stabilize and states were returning to more “normal” state budget environments, following multiple years of high revenue and spending growth as well as pandemic-related volatility and unpredictability. States appeared to be in a stable fiscal position, though there is variation across states. According to FY 2025 enacted budgets, most states anticipated revenue growth would continue to flatten and state general fund spending growth would slow. While states have made a number of Medicaid investments in recent years, including to expand access to behavioral health services, improve Medicaid reimbursement rates (particularly for long-term care), and to use Medicaid to help address social determinants of health, and reduce health disparities, expectations of reduced revenue collections beyond 2025 may dampen enthusiasm for further investments in Medicaid and could even prompt spending reductions. Reduced state revenues may be tied to implementation of state tax cuts, the expiration of pandemic-era federal funding, and other macroeconomic uncertainties Any reductions in federal Medicaid spending would put further pressure on state budgets and lead to program cuts.

The Long-Term Care Workforce

It is unknown whether new administrative actions will undermine efforts to bolster the long-term care workforce. There are also longstanding challenges finding enough workers to provide long-term care for people who need such services, and the COVID-19 pandemic exacerbated those issues considerably. As of February 2024, employment levels in most long-term care settings remained below pre-pandemic levels. The Biden Administration finalized two rules intended to address those challenges and increase access to services. The Administration finalized a rule that would create new staffing requirements in nursing facilities, require state Medicaid agencies to report on the percent of Medicaid payments for institutional long-term care that are spent on compensation for direct care workers and support staff, and provide funding for individuals to enter careers in nursing facilities. The rule will increase the number of staff in many nursing facilities, but also increase Medicaid spending. The Administration also finalized a rule aimed at ensuring access to Medicaid services, which included several provisions aimed specifically at home care, which is long-term care provided in home and community environments. The “access” rule requires states to spend least 80% of total payments for certain home care services on compensation for direct care workers. It’s unknown whether the Trump Administration will implement those rules or revise them, and it is possible Congress will overturn them.

Cuts to Medicaid and changes in immigration policy may exacerbate workforce challenges, reduce payment rates for long-term care workers, and erode supports to family caregivers. In response to workforce challenges, many states have adopted payment rate increases for nursing facilities and home care providers with the goal of boosting staffing levels. All states have also created supports for family caregivers, recognizing that caregiving can be very demanding, particularly when there are shortages of paid caregivers. Those initiatives may be impossible to sustain if federal support for Medicaid is reduced by one third. Beyond reducing Medicaid resources, President Trump’s planned crackdown on immigration may further strain the long-term care workforce, which relies heavily on foreign-born workers.

What to Watch

The issues identified in this policy watch could have major implications for Medicaid coverage, financing, and access to care. As these issues play out, the following key questions will be at the forefront:

• Federal funding cuts and financing reforms: Will Congress enact major cuts to federal Medicaid funding and changes to how the Medicaid program is financed? What will federal cuts in Medicaid mean for people enrolled in the program, states, and providers? How will the impact of any federal policy and funding changes vary across states?
• Work requirements: Will Congress pass legislation to allow or require work and reporting requirements in Medicaid? If Congress does not include work requirements in legislation, which states will pursue work and reporting requirement waivers under a second Trump administration? How will such policies affect coverage?
• Other waivers and administrative changes: Beyond work requirements, what waivers will be encouraged and approved under the second Trump administration? Will the administration withdraw any approved waivers or rescind Biden administration waiver guidance? What will happen with major access and eligibility / enrollment regulations finalized under the Biden administration? How will other administrative guidance affect coverage?
• State budget constraints and priorities: What are current projections for state revenue growth? How will changes in state fiscal conditions affect states’ ability to continue to pursue and maintain recent investments in Medicaid for behavioral health, long-term care, reimbursement rates, social determinants of health, and efforts to reduce disparities? How will federal Medicaid policy changes affect state budgets?
• The long-term care workforce: Will Congress or the new Trump administration overturn final rules that would bolster nursing facility staffing, wages for long-term care workers, and payment transparency? How will broader changes in Medicaid affect states’ ability to retain higher payment rates for long-term care workers and supports for family caregivers? How will changes in immigration policies affect the direct care workforce?

With President Trump now in office, his cabinet nominees continue to testify at congressional hearings as part of the nomination process. Robert F. Kennedy Jr. is the nominee to be the secretary of the Department of Health and Human Services (HHS), and his nomination hearings will spotlight a range of HHS activities but may not touch on the full scope of the department’s responsibilities. To better understand HHS’s impact on the health care system and the American people’s coverage, public health, safety, and well-being, what follows is an overview of the activities of the department.

Overview of HHS

The Department of Health, Education, and Welfare was established in 1953 and evolved into the Department of Health and Human Services in 1980 after the Department of Education was established as an independent entity. A relatively new department of the 15 current executive branch departments, HHS has a Fiscal Year (FY) 2024 budget funding estimated at $1.7 trillion, and the department’s budget is about a quarter of the total FY 2024 U.S. federal budget. It has the largest budget of any federal agency and is the largest grant-making agency.

Most federal executive branch health policy is implemented and managed within HHS, though the White House typically plays a major role in policymaking. The department has 13 operating divisions, most of which have a health focus in areas of coverage, research, regulation, resource delivery, and training. Others are focused on social assistance and support for families and communities in need. More than 80,000 HHS employees are located across the U.S. and the world and half of the workforce is outside the greater Washington, D.C. area.

The Public Health Service (PHS) predates HHS and now exists across ten of the 13 operating divisions within the department:

• The Administration for Strategic Preparedness and Response (ASPR)
• The Advanced Research Projects Agency for Health (ARPA-H)
• The Agency for Healthcare Research and Quality (AHRQ)
• The Agency for Toxic Substances and Disease Registry (ATSDR)
• The Centers for Disease Control and Prevention (CDC)
• The Food and Drug Administration (FDA)
• The Health Resources and Services Administration (HRSA)
• The Indian Health Service (IHS)
• The National Institutes of Health (NIH)
• The Substance Abuse and Mental Health Services Administration (SAMHSA)

Led by the Assistant Secretary of Health and the U.S. Surgeon General, the more than 6,000 United States Public Health Service Corps work across HHS and several other federal departments in everyday roles involving their health expertise, but they are also the country’s frontline workers for emergency response including public health emergencies.

Health Care Coverage and Affordability

The largest division of HHS is the Centers for Medicare and Medicaid Services (CMS), responsible for administering or overseeing health insurance coverage for Medicare, Medicaid, the Children’s Health Insurance Program, and the Affordable Care Act’s Health Insurance Marketplaces. Together, these programs provide health coverage access to 170 million Americans—more than half the population. However, the impact of HHS on the nation’s health insurance system goes well beyond the programs it administers, as it is heavily involved in the federal regulation of private health insurance, including employer-sponsored health insurance covering more than 150 million people, in conjunction with the Departments of Labor and the Treasury.

Beyond the core health insurance programs CMS administers, HHS also supports access to health care services in several other ways. Community health centers provide primary care and some additional services to low-income and uninsured populations and often serve special populations, e.g., people experiencing homelessness, migratory agricultural workers, and rural residents. HHS has a central role in setting standards and providing significant funding through various sources. HHS also provides medical and public health care to American Indians and Alaskan Natives through a network of providers run or contracted by the Indian Health Service. It has programs addressing the needs of specific populations, including the Ryan White HIV/AIDS program, refugee health, mental health and substance use treatment programs, and maternal and child health, to name a few.

Public Health and Disease Control

The public health role of HHS has been in the spotlight due to the COVID-19 pandemic, but its role during the crisis was based on pre-existing infrastructure and routine activities that adapt to the needs of the day. The department has a long-standing role in monitoring, preventing, and reducing the spread of infectious and non-communicable diseases. Its role encompasses a wide range of responsibilities, including research, screening, policy development and guidance, public education, treatment, and funding for state and local health departments.

Aside from COVID-19, HHS has been active in addressing infectious disease outbreaks of H5N1 avian flu, mpox, and hepatitis A in the past five years and works on long-term challenges like the HIV/AIDS epidemic. The role of HHS in vaccination dates back to the 1950s polio vaccine and it continues to have a substantial role in influencing the country’s vaccine policy.

Emergency Preparedness and Response

The routine health activities of HHS often merge with its role in addressing the health impacts of public emergencies and disasters. Events like the September 11, 2001, terrorist attacks, the opioid epidemic, the Flint, Michigan water crisis, natural disasters of hurricanes, tornadoes, and wildfires, and disease outbreaks have all triggered an HHS response in conjunction with other federal agencies.

HHS has provided emergency coordination and strategic planning to set up shelters for acute medical care and mental health support, sometimes utilizing the National Disaster Medical System, accessed stockpiles of critical equipment and medicine, led investigations and expanded on testing and monitoring activities, and assisted with survivor and community recovery including continuity of health care services.

Food and Drug Safety

Arguably, the broadest touch point for HHS’ impact on Americans’ daily lives is its role in food safety. The Food and Drug Administration (FDA) oversees most food safety aside from meat and poultry and shares responsibility for egg products with the Department of Agriculture. It also regulates the information about dietary supplements provided to consumers, though it does not have authority to approve them for safety and effectiveness. Among the activities related to food safety are conducting inspections of facilities, labeling requirements, issuing food recalls and alerts, and ensuring imported food meets U.S. standards. However, the FDA isn’t the only HHS agency that plays a significant role in food safety, as the Centers for Disease Control’s broad role of monitoring and responding to disease outbreaks also includes those related to consuming contaminated food.

HHS has a major role in regulating medical drugs and devices, mainly through the FDA. This includes pre-market testing for the safety and effectiveness of a product’s intended use, monitoring of approved products for any harm to consumers, and regulations for producing and labeling such products.

Scientific Research and Innovation

HHS, primarily through the National Institutes of Health, is the world’s largest public funder of health research. While the research often conducted can center on the basics of science and biomedicine, it has led to breakthroughs like the first successful polio vaccine, treatments for cancer and HIV/AIDs, the development of MRI technology, and the ability to personalize medicine because of the mapping of the human genome.

Supporting Families and Communities

The health of individuals can be impacted by several non-medical factors often categorized as social determinants of health. HHS has a range of social service programs that may not be typically considered health services, but usually factor in the stability of individual and family lives.

Financial assistance for low-income families with children has long been a federal program, and Temporary Assistance for Needy Families (TANF) is the primary cash assistance program for this population. TANF is administered by the HHS Administration of Children and Families (ACF) which also has programs related to child support enforcement, foster care, adoption, and child care. It also promotes early childhood development in low-income children under the age of five through Head Start.

One element of the department’s support services that has gained significant attention over the past decade, particularly as refugee resettlement submissions to the U.S. have sharply increased, is the array of services offered by the Office of Refugee Resettlement (ORR). Established 45 years ago, ORR aims to integrate individuals, including unaccompanied minors, and families into American society and provide a pathway to self-sufficiency. Services offered include financial assistance, housing, medical care, and employment services.

Medicare provides health insurance coverage to 67 million adults—20% of the U.S population—and is a major source of revenue for physicians and other health providers. In 2024, Medicare spending on Part B services (including physician services, outpatient services, and physician-administered drugs) accounted for nearly half (49%) of total Medicare benefit spending. Physicians are not required to participate in Medicare, though the vast majority of them choose to do so.

In recent years, physician groups and some policymakers have raised concerns that physicians would opt out of Medicare due to reductions in Medicare payments for many Part B services, potentially leading to a shortage of physicians willing to treat people with Medicare. Medicare payments are lower, on average, than payments from private insurers and are not automatically indexed to keep pace with inflation in medical practice costs. Every year, as required by law, the Centers for Medicare & Medicaid Services (CMS) updates Medicare payments to physicians under the physician fee schedule through rulemaking. Since 2021, Congress has enacted four temporary, one-year increases to physician payment rates to soften scheduled cuts. However, Congress has not enacted a payment increase for 2025, and a 2.93% drop in average Medicare payments to physicians went into effect on January 1.

Despite these ongoing concerns, virtually all (98%) of non-pediatric physicians participate in the Medicare program. Furthermore, Medicare beneficiaries report access to physician services that is equal to, or better than, that of privately-insured individuals, with similar shares reporting delays in needed care or difficulty finding a physician who takes their insurance.

This brief uses the most recent CMS data to document the extent to which non-pediatric physicians have opted out of Medicare, by specialty and by state, as of November 2024, updating prior KFF analyses. (See Methods for details).

Key Takeaways:

• About one percent of all non-pediatric physicians have formally opted out of the Medicare program in 2024. The share was highest for psychiatrists (8.1%), followed by plastic and reconstructive surgeons (4.5%) and neurologists (3.2%).
• In 11 specialties, the share of physicians who have opted out of Medicare is 0.5% or lower, with the lowest shares seen among emergency medicine physicians (0.1%), oncologists (0.1%), radiologists (0.1%), and pathologists (<0.1%).
• Psychiatrists account for the largest share (39.0%) of all non-pediatric physicians who have opted out of Medicare in 2024, followed by family medicine physicians (21.5%) and internal medicine physicians (13.0%).
• Less than two percent of non-pediatric physicians have opted out of Medicare in 47 states. The rate is slightly higher in three states and the District of Columbia: Alaska (2.8%), Colorado (2.3%), Idaho (2.2%), and the District of Columbia (2.9%).

Three options for physicians

Currently, physicians and other health providers seeking payment from Medicare for Part B services must enroll as a Medicare provider. Physicians may either agree to be a participating provider or non-participating provider. Providers who do not want to enroll in Medicare or receive Medicare payments are required to sign an “opt out” agreement with their patients.

• Participating providers agree to accept “assignment” on all Medicare claims for all of their Medicare patients, which means that they have signed a participation agreement with Medicare, agreeing to accept Medicare’s fee schedule amounts as payment-in-full for all Medicare covered services. Medicare beneficiaries seeing a participating provider can only be liable for the cost sharing required by Medicare. Providers have several incentives to be participating providers, such as being paid higher rates (5% higher) than the rates paid to non-participating providers. In 2022, the vast majority (98%) of physicians and practitioners billing Medicare were participating providers.
• Non-participating providers accept Medicare patients, but can choose whether to take assignment (i.e., Medicare’s approved amount) on a claim-by-claim basis. Unlike participating providers, who are paid the full Medicare-allowed payment amount, non-participating physicians who take assignment are limited to 95% of the Medicare approved amount. In 2022, 7% of fee schedule claims were paid on assignment. Physicians who choose to not accept assignment can charge beneficiaries up to 15% more than the Medicare-approved amount, a process known as “balance billing.” Medicare patients are financially liable for this additional amount plus applicable deductibles and coinsurance.
• Opt-out physicians and other practitioners must sign an affidavit to “opt out” of the Medicare program entirely. These providers enter into private contracts with their Medicare patients, allowing them to bill any amount they determine is appropriate. Providers who have opted out of the Medicare program must opt out for all of their Medicare patients, including those enrolled in Medicare Advantage. Medicare patients seeing a provider who has opted out of the Medicare program must sign this agreement and agree to be financially responsible for the entire cost of any services received. Neither the provider nor the patient can submit a bill to Medicare for reimbursement of any service covered under Medicare Part B. Opt-out agreements last for two consecutive years and are automatically renewed at the end of each two-year period.

What share of physicians have opted out of Medicare?

1.2 percent of non-pediatric physicians have formally opted out of the Medicare program. As of November 2024, 12,244 non-pediatric physicians have opted out of Medicare, representing a very small share (1.2%) of the total number active physicians, similar to the shares reported in 2013 and 2022 (Figure 1).

While the overall opt-out rate is low, opt-out rates are somewhat higher for certain specialties, such as psychiatry and plastic and reconstructive surgery. In 2024, 8.1% of psychiatrists have opted out of Medicare, followed by 4.5% of physicians specializing in plastic and reconstructive surgery and 3.2% of physicians specializing in neurology (Figure 2).

On the other hand, of the 26 specialty groups included in this analysis, 11 have opt-out rates that are 0.5% or lower, with the lowest rates seen among physicians specializing in emergency medicine (0.1%), oncology (0.1%), radiology (0.1%), and pathology (<0.1%) (Appendix Table 1).

Psychiatrists are disproportionately represented among the 1.2 percent of active physicians who have opted out of Medicare. Psychiatrists account for the largest share (39.0%) of opt-out physicians, followed by physicians in family medicine (21.5%), internal medicine (13.0%), and obstetrics/gynecology (5.9%) (Figure 3). This is consistent with prior analyses that found that psychiatrists are less likely than other physician specialties to accept new patients with Medicare or private insurance, suggesting that psychiatrists may prefer to be paid directly by their patients, in order to avoid the administrative burden of submitting claims to insurers and maintain the flexibility to charge higher fees.

In addition to physicians, another 4,474 select clinical professionals with doctorate degrees (i.e. oral surgeons, podiatrists, and optometrists) have also opted out of the Medicare program, with oral surgeons accounting for the vast majority (93.9%) of this group (Appendix Table 1).

Less than two percent of physicians have opted out of Medicare in all but three states and the District of Columbia. As of November 2024, the District of Columbia (2.9%), Alaska (2.8%), Colorado (2.3%), and Idaho (2.2%) have the highest rates of non-pediatric physicians who have opted out of Medicare (Figure 4). In twelve states (Alabama, Arkansas, Iowa, Kentucky, Minnesota, Mississippi, Nebraska, North Dakota, Ohio, South Dakota, West Virginia, and Wisconsin) the opt-out rate is 0.5% or lower (Appendix Table 2).

Due to data limitations, this analysis only includes opt-out rates at the state level. Opt-out rates may vary based on rural status and other county-level factors, and some counties may have opt-out rates that are higher than the state average.

Appendix

Supplemental Tables

Introduction

Title 42 of the Public Health Services Act is a public health authority that authorizes the Director of the Centers for Disease Control and Prevention (CDC) to suspend entry of individuals into the U.S. to protect public health. This rarely utilized authority was implemented by the Trump administration in March 2020 in response to the COVID-19 pandemic to allow for quick expulsion of migrants, including asylum seekers, seeking entry into the U.S. at the land borders. After a series of delays due to court challenges, the restrictions were lifted when the Biden Administration declared an end to the COVID-19 public health emergency (PHE) on May 11, 2023. The Biden administration subsequently took increasingly restrictive executive action to restrict border entry.

Land border entries into the U.S. decreased as a result of Title 42 since individuals who had border encounters under this authority were immediately expelled due to the public health threat outlined by the Trump administration. However, research suggests that Title 42 restrictions did not result in a “better managed border” and increased cases of unauthorized re-entry, and public health experts stated that it put the health and well-being of migrants at risk. Recent reports suggest President-elect Trump may reinvoke Title 42 restrictions during his second term to close the border between the U.S. and Mexico, along with a number of other actions to restrict immigration.

This brief provides an explanation of Title 42 and its application in border regions, the impact of Title 42 on border expulsions and the health and well-being of migrants during COVID-19, and a discussion of the potential implications of reinvoking Title 42 restrictions for immigration and the health of migrants.

What are policies for migrants seeking entry at the U.S. border?

Under U.S. immigration law, individuals have a legal right to claim asylum when presenting at U.S. ports of entry. An asylee is an individual already present in the U.S. or seeking admission at a port of entry who is seeking protection based on “persecution or a well-founded fear of persecution on account of their race, religion, nationality, membership in a particular social group, or political opinion.” In fiscal year (FY) 2023, the U.S. granted asylum to over 54,000 individuals from close to a dozen different countries. However, as of October 2024, over 90% of asylum cases filed in FY 2023 were still pending with only 2% being granted approval due to immigration backlogs.

Migrants encountered at the border are processed and screened for asylum under Title 8 of the U.S. Code addressing “Aliens and Nationality.” Under Title 8, those determined to have a credible fear of persecution or other threats in their home country are either held in custody or released into the U.S. while their case is pending in immigration court. Those who the U.S. Citizenship and Immigration Services (USCIS) determine not to have a credible fear are permitted to appeal this decision to an immigration judge. If an individual chooses not to appeal or the immigration judge did not find fear, then the individual is removed.

In June 2024, the Biden administration took executive action to suspend and limit the entry of migrants at the southern border, including asylum seekers, to “address the historic levels of migration and more efficiently process migrants arriving at the southern border.” Under this rule, the suspension of entry will go into effect immediately after there have been 2,500 or more average daily border encounters (not including unaccompanied children) over seven consecutive days and can be lifted once there have been fewer than 1,500 average daily border encounters over seven consecutive days. As of April 2024, there were about 4,000 average daily border encounters, leaving the restrictions in place. U.S. Customs and Border Patrol (CBP) data show that border encounters following the executive order were at a three-year low with there being a 29% reduction in encounters between May and June 2024.

How did Title 42 change policy for migrants seeking entry at the border during the COVID-19 pandemic?

In March 2020, the Trump administration implemented Title 42 under the Public Health Service Act, which allowed for the immediate expulsion of migrants without screening for asylum. This order applied to all migrants arriving to the U.S. from Canada or Mexico regardless of their country of origin who would otherwise be held in a congregate setting at a port of entry or border patrol station. It did not apply to lawful permanent residents and their families, members of the armed forces or their families, or people who hold valid travel documents such as tourists or those in a visa waiver program. Officials also had authority to make exceptions for individuals on a case-by-case basis. Under this order, the CDC Director was authorized to “suspend the introduction of persons into the United States” and CBP officials were directed to process migrants promptly (within 15 minutes in an outdoor setting) without screening for asylum and expel them back to Mexico or Canada or their country of origin. The CDC stated the purpose of the order was to protect CBP personnel, U.S. citizens, lawful permanent residents, and other individuals from an increase in COVID-19 spread at land ports of entry, Border Patrol stations, and in the interior of the country. The order pointed to the introduction of individuals into congregate settings at the border and the increased strain this would put on the U.S. health care system during a public health emergency as primary reasons for implementing the restrictions on entry.

Title 42 continued to be enforced under the Biden administration until the end of the COVID-19 PHE declaration in May 2023. However, unaccompanied minors were exempted from the order based on a district court ruling in November 2020 and by a CDC order issued under the Biden administration in February 2021. The CDC order continued to apply the original Title 42 order to single adults and families. After facing legal challenges, Title 42 restrictions were lifted in May 2023 following the end of the COVID-19 PHE declaration.

How did implementation of Title 42 impact immigration and the health of migrants?

Between FY 2021¹  and 2023, there were over 6.5 million encounters at the Southwest land border of which about four in ten (41%) were under Title 42 authority. Enforcement encounters refer to “apprehensions or inadmissibles processed under CBP’s immigration authority;” these include individuals apprehended under Title 8 as well as individuals expelled under Title 42. While Title 42 applies to both the Northern and Southwestern Borders, nearly all Title 42 encounters occurred at the Southwestern Border. Between FY 2021 and FY 2023, Title 42 encounters at the Southwest Border accounted for about four in ten (41%) of all Southwest Border encounters. The share of encounters that were under Title 42 varied by demographic group with Title 42 accounting for a majority (56%) of single adult encounters and one in six (17%) family encounters, while Title 8 accounted for virtually all (99%) encounters with unaccompanied minors reflecting their exemption from expulsion under Title 42 (Figure 1).

As of May 2023, there were over 2.5 million single adult expulsions, nearly 320,000 expulsions of individuals in a family unit, and nearly 16,000 expulsions of unaccompanied minors under Title 42. The number of family expulsions under Title 42 grew between FY 2020 and FY 2021, while expulsions of unaccompanied minors decreased, reflecting their exemption beginning in February 2021. These encounter counts reflect repeat encounters with individuals, as each attempt by the same individual to cross the border is counted as a new encounter.

Data indicate that Title 42 did not lead to a reduction in border encounters, but border entries into the U.S. went down due to the nature of the authority. While Title 42 was intended to reduce COVID-19 exposure risk at the border, it led to an increasing number of encounters at the border largely due to repeat encounters. This is in large part because, unlike Title 8, migrants apprehended under Title 42 were immediately expelled and those with repeat encounters did not face any penalties. Data from 2020 through 2023 suggest that while there were close to 3 million Southwest border expulsions under Title 42 authority, many of those expulsions were of the same individuals making repeated attempts to cross the border. In the last 6 months of 2021, a quarter of the encounters under Title 42 were of the same individuals on multiple occasions, with recidivism rates under the authority being at their highest levels in over a decade. In addition, there has not been a significant increase in border encounters since Title 42 was lifted with border encounters in FY 2024 (2.1 million) being lower than border encounters in FY 2022 (2.4 million) and FY 2023 (2.5 million). However, entries into the U.S. through land borders decreased as a result of Title 42 since individuals who had border encounters under this authority were immediately expelled due to the public health threat outlined by the Trump administration.

Research suggests Title 42 expulsions negatively impacted the health and well-being of migrant families while having little to no impact on preventing the spread of COVID-19 in the U.S. Physicians, epidemiologists, and public health experts repeatedly stated that Title 42 was counterproductive to preserving health and protecting individuals from COVID-19. Physicians suggested that being in close proximity with other individuals while being temporarily detained or transported back to Mexico, lack of medical screenings, and lack of provision of necessary medication could have adverse impacts on physical and mental health. Typically, the CDC recommends that asylees be provided an initial medical screening within 30-60 days of arriving in the U.S., but since Title 42 called for immediate expulsion, such screenings were not provided. Interviews conducted with over two dozen asylum seekers who were expelled under Title 42 authority found that a vast majority reported symptoms of depression, anxiety, and post-traumatic stress disorder (PTSD), and many reported that their children’s mental health was also impacted. Sending individuals back to potentially dangerous situations they were fleeing also poses risks. Title 42 may also have contributed to increases in family separations at the border. Media reports suggested that some families were separating from their children so that the children could seek entry as unaccompanied minors, who were exempt from Title 42 expulsions. These separations may have led to children facing dangerous situations traveling to the border and expose them to trauma and toxic stress. The impact of Title 42 on migrant families may also have been exacerbated by the “Remain in Mexico” or Migrant Protection Protocols program implemented under the first Trump administration, which required thousands of migrants (including children) to wait for their U.S. immigration court hearings in Mexican border towns that can be dangerous and unsafe. Close to 80% of migrants receiving medical treatment from Doctors without Borders/Medecins Sans Frontieres at border locations in Nuevo Laredo, Mexico, reported being victims of violence, with many experiencing depression, severe anxiety, and post-traumatic stress.

What are the potential implications of reinvoking Title 42?

The incoming Trump administration has indicated plans to reinvoke Title 42. President-elect Trump has proposed an array of policies focused on restricting immigration. Recent reports suggest that the incoming Trump administration is planning to reinvoke Title 42 to restrict immigration under the rubric of public health protection. Experiences during COVID-19 suggest Title 42 was not effective at reducing border encounters or preventing COVID-19 and had negative health impacts for migrants. Reinvocation of such a policy also raises questions about its use as a border enforcement tool and could potentially fuel xenophobic sentiment towards immigrants.

1. U.S. Customs and Border Protection, “Nationwide Enforcement Encounters: Title 8 Enforcement Actions and Title 42 Expulsions Fiscal Year 2021”. Accessed January 2025. ↩︎

With the incoming Trump administration and Republican-led Congress looking to ways to reduce federal spending, a new KFF Health Tracking Poll finds that the Medicare and Medicaid programs remain broadly popular, and more people favor more spending on those programs than less spending.

About eight in 10 Americans overall view Medicare (82%) and Medicaid (77%) favorably. This includes majorities across partisans, including most Republicans (75% view Medicare favorably and 63% view Medicaid favorably).

About half (46%) of the public say the federal government doesn’t spend enough on Medicaid, more than twice the share (19%) who say the government spends “too much.” The gap is even larger for Medicare, with half (51%) of the public saying the government doesn’t spend enough compared to 15% who say the government spends too much.

The Affordable Care Act (ACA), sometimes called Obamacare, also remains popular, with nearly two thirds (64%) of the public holding favorable views, though with more of a partisan divide. Most Democrats and independents hold favorable views of the ACA, while about three quarters of Republicans (72%) hold unfavorable views.

Large majorities also say they are “very” or “somewhat” worried that people covered by each of the three programs in the future won’t get the same benefits available today. This includes 81% who say so about Medicare, 72% who say so about Medicaid, and 70% who say so about the ACA marketplaces. Republicans are less worried than other partisans about Medicaid and the ACA.

Ahead of President Trump’s inauguration, the poll also assesses how the public prioritizes 11 potential actions on health that the new administration and Congress could take.

About six in 10 say that boosting price transparency rules (61%) and limiting chemicals in the food supply (58%) are both a “top priority.” This includes majorities of Republicans, independents and Democrats.

During his first administration, President Trump issued federal regulations establishing price transparency requirements for hospitals and insurers, and Robert F. Kennedy Jr., his pick to head the U.S. Department of Health and Human Services, has long advocated against chemicals in food.

In contrast, few among the public rank several other health policies associated with President Trump and his allies as top priorities.

For example, about one in seven say that reducing federal spending on Medicaid (13%) or limiting access to abortion (14%) is a top priority, while much larger shares say each of these “should not be done” (44% and 51%, respectively). Other low-ranking priorities include cutting funding to schools that require students to get vaccinated (15%), encouraging communities not to add fluoride to their water supply (23%), and repealing and replacing the ACA (27%).

Among other health priorities:

• Medicare drug price negotiations. More than half (55%) of the public say it is a top priority to expand the number of prescription drugs subject to Medicare drug price negotiations, including most Democrats (65%) and about half of Republicans (48%). Only 3% say this shouldn’t be done.
• Regulating insurance claim denials. Most people (55%) say more closely regulating insurers’ decisions to approve or deny claims for health services or prescription drugs should be a top priority. This includes most Democrats (61%) and independents (59%), along with nearly half (45%) of Republicans. Overall, just 5% oppose this.
• Enhanced ACA subsidies. About a third (32%) say that extending the expanded financial assistance that helps make ACA marketplace health insurance affordable should be a top priority. This includes half of Democrats (50%) but few Republicans (16%). Only 7% say this shouldn’t be done.

The incoming Trump administration has established a new “Department of Government Efficiency,” or DOGE, charged with developing plans to cut federal spending and reduce regulations.

Most Americans (73%) say that reducing fraud and waste in government health programs would lead to “major” or “minor” reductions in federal spending overall. This includes most Republicans (80%), independents (72%), and Democrats (68%).

At the same time, more than half (55%) of the public also say that reducing fraud and waste would lead to reductions in the benefits that people receive from government health programs. At least half of Republicans (60%), Democrats (55%), and independents (51%) hold this view.

Other findings include:

• Most of the public say the government is not spending enough on the prevention of chronic diseases (60%) or prevention of infectious diseases and preparing for future pandemics (54%). Much smaller shares say the government spends “too much” on each of these.
• More than half (57%) of the public say they expect health care to become less affordable for their families over the next few years. This includes most (54%) Trump voters and half (51%) of Republicans despite the campaign’s emphasis on addressing rising costs, including in health care.

Designed and analyzed by public opinion researchers at KFF. The survey was conducted Jan. 7-14, 2025, online and by telephone among a nationally representative sample of 1,310 U.S. adults in English and in Spanish. The margin of sampling error is plus or minus 3 percentage points for the full sample. For results based on other subgroups, the margin of sampling error may be higher.

A new KFF analysis finds that there were 44 million people enrolled in health coverage through the Affordable Care Act’s Marketplaces and its expansion of the Medicaid program in 2024. That represents about 1 in every 6 people under age 65, or 16.4%.  

There was significant variation in ACA enrollment across states, ranging from about 1 in 4 nonelderly people in Louisiana, Oregon, Florida, and New York to fewer than 1 in 10 in Tennessee, Alabama, Wyoming, Kansas, and Wisconsin, according to the analysis.  

With the exception of Florida, the states with the largest ACA-related enrollment as a share of population had adopted the Medicaid expansion, while all five states with the lowest share of enrollment were non-expansion states. (The data includes enrollment in the Basic Health Program, an option offered by some states under the ACA to provide coverage for low-income residents who would otherwise be eligible to obtain coverage through the Marketplace. There were 1.3 million people enrolled in this option in 2024.) 

The new analysis helps illustrate how many people could potentially be affected by the anticipated policy debates in Congress, including whether to allow enhanced ACA Marketplace subsidies to expire this year, whether to reduce the federal share of Medicaid expansion funding, or whether to enact deeper spending cuts to ACA subsidies and Medicaid to help pay for expected tax cuts.   

From 2020 to 2024, total enrollment in ACA programs (Medicaid, Marketplace, and Basic Health Plan) increased by nearly 60%, with the largest increase among Marketplace enrollees, helping to drive the uninsured rate down to historic lows.  The number of Marketplace enrollees increased by 10 million people nationally, almost doubling, over the period, and the number of Medicaid expansion enrollees increased by 6.2 million people. States with the largest increases in enrollment, in percentage terms, included Missouri (243%), Oklahoma (227%), Texas (212%), Mississippi (190%), North Carolina (185%) and Georgia (186%).  

Growth in Marketplace enrollment over the period can be largely attributed to the temporary enhanced subsidies that were made available in 2021, which were extended through 2025. Marketplace enrollment climbed to a new record high in 2025, with nearly 24 million people signing up for plans during the current enrollment period.  Marketplace enrollment was 21.4 million in 2024.

Medicaid expansion enrollment increased due to more states implementing expansion (seven states—Idaho, Missouri, Nebraska, North Carolina, Oklahoma, South Dakota, and Utah—implemented Medicaid expansion during or after 2020) and because of the pause in disenrollments from the pandemic-era continuous enrollment provision. Medicaid expansion enrollment totaled 21.3 million people in 2024. Even with the unwinding of the continuous enrollment provision that was still in play through March 2024, overall enrollment in Medicaid expansion is higher than in 2020.