Nebraska’s Medicaid work requirements are causing coverage losses mainly through unanswered verification notices, not through enrollees failing to meet the rules, according to a Sept. 29 analysis from KFF.
KFF researchers drew the data from Nebraska’s Sept. 17 Medicaid Advisory Committee meeting. The analysis covers 4,089 applications processed from May through August and 7,280 renewals processed from July through mid-August that required a work requirement determination.
Here is what revenue cycle leaders should know:
1. Unanswered paperwork causes most coverage losses. Fourteen percent of applicants subject to the requirements, or 557 people, were denied. Seven percent of renewing enrollees, or 533 people, lost coverage. Nonresponse to requests for more information caused 84% of those denials and 92% of those disenrollments. Only 16% of denied applicants and 8% of disenrolled enrollees were affirmatively found noncompliant.
2. Enrollees have 30 days to respond. When Nebraska cannot automatically verify compliance through available data, it mails a notice and a declaration form. The individual must return the form within 30 days.
3. Income and hours are the main path to compliance. Among applicants who met qualifying activities, 92% did so by working at least 80 hours in the month before applying or earning at least $580 in monthly household income. Among renewing enrollees, the figure was 97%. School, volunteering, work programs and combined activities made up the small remainder.
4. Claims history supports frailty exclusions. Medically frail enrollees made up 39% of renewal exclusions and 25% of applicant exclusions. KFF said Nebraska may have been able to automatically verify medical frailty for more renewing enrollees because states are more likely to have claims history for people renewing coverage than for new applicants.
5. Frailty rules may tighten. CMS told Nebraska it must change how it verifies medical frailty. If the state tightens that process, fewer patients may qualify for the exclusion. That change could increase the number of patients who must prove work compliance or risk losing coverage.
6. Hospital admissions can trigger a hardship exception. Nebraska adopted optional short-term hardship exceptions. They include exceptions for residents of counties with high unemployment or natural disasters, people admitted to a hospital or nursing facility, and people who travel outside their community for extended medical care for themselves or a dependent. Uptake has been limited: 92 applicants and 127 renewing enrollees received a hardship exception. Most of the renewal exceptions went to residents of counties affected by natural disasters.
7. Key questions remain open. KFF noted that the data do not yet show whether people who ignored notices were ineligible, unaware of the requirement or unable to produce documentation. The data also do not show whether denied individuals will reapply. All Medicaid expansion states must implement work requirements by Jan. 1, 2027.
