By Roberta Meyers and David Muhammad
With the passage of H.R. 1, also known as the One Big Beautiful Bill Act, in 2025, Congress enacted a sweeping overhaul of Medicaid, including new work reporting requirements that will begin taking effect in 2027. As states prepare to implement these changes, they face a set of choices that could carry life-or-death consequences for many residents.
Unless officials take deliberate action to preserve access to care, millions of people, including those returning home from incarceration, are likely to fall through the cracks, with damaging ripple effects on public safety and community stability.
States Still Have Choices
As states contend with H.R. 1’s cuts and new administrative burdens, they must understand that they still have a say in how these provisions take shape on the ground in their communities. State policymakers and Medicaid administrators will ultimately determine how aggressively they protect coverage for vulnerable populations, including through exemptions and reporting processes associated with the work requirements. They also will determine whether they continue building out Medicaid reentry waivers, which, once approved by the Centers for Medicare & Medicaid Services, allow states to leverage federal Medicaid dollars to connect people leaving jail or prison to coverage and community-based health care before release.
The stakes are especially high for the reentry population. Compared with the general public, people leaving jail and prison face elevated rates of chronic health conditions such as diabetes, HIV, hypertension, and hepatitis C, alongside significantly higher rates of behavioral health disorders. The risks can be immediate and severe: In the first two weeks postrelease, people’s risk of death is 13 times greater than the general mortality rate, and they are 129 times more likely to die from overdose. Access to Medicaid during this fragile period can be the difference between life and death.
Moreover, when people who are recently released lose access to health care, the consequences extend well beyond the individual. People leaving incarceration without care or support are more likely to return to active drug use and experience mental health crises and housing instability, all of which increase their likelihood of recidivism.
The ensuing harms undermine public health and safety, increase overall costs to taxpayers, and place communities at greater risk. Ensuring continuity of care for returning citizens is one of the most effective ways to support successful reentry, reduce reincarceration, and bolster collective well-being.
Bipartisan Support for Medicaid Reentry
There is broad, bipartisan recognition of the value of this approach. Seventy percent of Americans, including majorities across party lines, have expressed support for connecting people in reentry to care. The federal government has approved more than a dozen Medicaid reentry waivers, from California to West Virginia, and continues to invest in continuity-of-care planning. Earlier this year, Wisconsin’s legislature, where Republicans hold majorities in both chambers, voted to instruct the state to develop and submit a reentry waiver to CMS, again indicating continued bipartisan support for this commonsense policy. In addition, as of Jan. 1, 2026, states are no longer allowed to terminate Medicaid coverage during incarceration; rather, they are permitted only to suspend coverage, ensuring easier and quicker re- enrollment upon release.
States Should Build on Reentry Infrastructure
Despite this progress, some states have already begun pausing or scaling back their Medicaid reentry initiatives, citing the strain of preparing for H.R. 1. This is a mistake. Rather than retreating, states should build on the progress they have made and use existing reentry infrastructure to help facilitate processes associated with H.R. 1’s new work requirements. Doing so will help prevent massive coverage interruptions and losses, reduce the use of costly emergency services, and save lives.
Past experiences with similar work requirement policies have shown that many people lose coverage and access to care because of bureaucratic red tape, not ineligibility. It is therefore paramount that states implement these requirements thoughtfully. They should simplify and streamline reporting and verification processes by, for example, using automated verification, including data matching with corrections agencies.
For formerly incarcerated individuals, it is critically important to note that, despite strong evidence that people in reentry want to work, persistent stigma and administrative hurdles make them particularly vulnerable to burdensome employment-related requirements. For this reason, other compliant activities, such as volunteering and participating in educational programs, are particularly important.
Exemptions Are Critical for Reentry
H.R. 1 also provides exemptions from the requirements for certain high-need populations, including people recently released from incarceration. This postrelease exemption, however, lasts only three months. It will therefore be essential for states to instruct their carceral systems and reentry provider networks to work with individuals to identify other longer-lasting exemptions, such as the “medically frail” exemption. This exemption may assist people leaving incarceration, given the disproportionately high rate of complex medical needs among this population. States and providers also should help individuals obtain the necessary documentation, so they do not experience lapses in coverage or care while working to stabilize their health, secure housing and employment, and successfully reintegrate.
According to CMS’ interim final rule on implementing the new Medicaid work requirements, released June 1, 2026, states must develop a list of diseases, diagnoses, disorders, or other health conditions that meet the medically frail criteria. States should develop these lists as robustly as possible and should explicitly include substance use disorders, which data show affect more than half of all incarcerated individuals.
Individuals whose qualifying physical, mental, or behavioral health conditions significantly impair their ability to comply with the work requirement should qualify for the exemption. However, because CMS is limiting the use of self-attestation, states also must accept verification of this exemption from a wide range of credentialed providers, including physicians, nurse practitioners, physician assistants, psychologists, counselors, therapists, and community social workers.
States Must Act to Protect Coverage
Just as crucial will be states’ public education campaigns around such exemptions. Equipping people recently released from incarceration with information will be especially critical because most will not have claims data already in the Medicaid system that administrators can use to verify an exemption. These individuals will therefore need to take proactive steps to protect their coverage.
The choice before states is clear. They can implement the new Medicaid rules in ways that cushion the blow while simultaneously working to advance their reentry waivers. Or they can double down on red tape, retreat from Medicaid reentry, and watch disparities deepen, costs rise, and communities suffer.
Yes, this requires coordination, foresight, and a commitment to treating health care access as a core component of successful reentry. But don’t we all ultimately want less recidivism, better health outcomes, and stronger, safer communities?
H.R. 1 should not be a reason to abandon this sound approach. If anything, it raises the stakes for getting it right.
About the Authors
Roberta Meyers is vice president of state strategy and reentry at the Legal Action Center, where she works to execute strategic state-based criminal justice and health advocacy goals through a racial justice lens to promote successful reentry, end the criminalization of health conditions, and build health equity among systemically under-resourced communities.
David Muhammad, executive director of the National Institute for Criminal Justice Reform, is a former deputy commissioner of the New York City Department of Probation and a speaker for the Law Enforcement Action Partnership.
