CMS Requires More Restrictive Definition of Medical Frailty in New Medicaid Work Requirements Rule
On June 1, 2026, the Centers for Medicare and Medicaid Services (CMS) issued a long-anticipated interim final rule that will guide state implementation of Medicaid work requirements. The 2025 reconciliation law requires 43 states to condition Medicaid eligibility for adults in the Affordable Care Act (ACA) Medicaid expansion group and enrollees in partial expansion waiver programs (Georgia and Wisconsin) on meeting work requirements starting January 1, 2027 or sooner at state option. Most Medicaid adults are already working or face barriers to work, and the Congressional Budget Office estimates that the new requirements will not meaningfully increase employment by Medicaid enrollees, but that millions of people will end up uninsured.
At nearly 400 pages, the rule is quite long and complex and will require time to fully assess its implications. Given the complexity of the provisions in the rule, states will likely face significant challenges in operationalizing the requirements in the next six months. With the short implementation timeline, states were already making implementation decisions that may not align with the rule. These challenges present risks for states given the potential for audits and financial penalties, but also for individuals who now face greater barriers to obtaining and maintaining coverage.
Significantly, the rule adopts a restrictive definition of medical frailty that differs from states’ early expectations. States have been eagerly awaiting clarification on how to define medical frailty. Early indications from CMS offered through informal meetings with states hinted that the federal definition might mirror an existing medical frailty definition used for determining individuals who are exempt from receiving an alternative benefit package, and that states would be given flexibility to go beyond the federal definition. However, on both counts, the rule adopted a more restrictive approach, first tying medical frailty specifically to the ability to comply with the community engagement requirement (i.e., the ability to work) and prohibiting states from adding categories of individuals to the medical frailty definition. To operationalize this definition, the rule requires states to develop lists of health conditions but prohibits them from categorically exempting people with those conditions without considering an individual’s ability to meet the community engagement requirement based on their health. The rule does not provide states with a list of diagnoses or criteria for measuring severity or ability to meet new requirements. For example, the rule does not allow states to exempt all people with cancer, HIV, Parkinson’s disease, or multiple sclerosis. This significant change may pose challenges for states that had been moving forward with developing lists of diagnosis codes assuming a less restrictive definition and could make it more difficult for individuals to document medical frailty.
The rule temporarily allows for self-declaration in limited circumstances to verify work or exemption status, including for medical frailty. Acknowledging that states will need time to establish systems upgrades to access new data sources and particularly to implement the medical frailty exemption, the rule allows states to accept self-declaration of work or exemption status when reliable data are not available through 2027. However, starting January 2028, except for verifying medical frailty, states must request documentation from individuals when the state does not have data on file. In the case of medical frailty, states are permitted to accept self-declaration only one time during the enrollment period. For example, if self-declaration of medical frailty is accepted at application, individuals must provide documentation at renewal, typically six months later.
While a temporary period of allowing people to self-attest to their compliance with work requirements will ease the effects for some, the more restrictive definition of medical frailty adopted by the Trump Administration will be challenging for states to implement and could lead to more people falling through the cracks and losing coverage.