Nebraska on Friday became the first U.S. state to enact Medicaid work requirements, seven months ahead of the deadline set by the Republicans' "big, beautiful bill" law.

Health care policy experts say they are closely watching Nebraska's early rollout of the new rules, which apply to people enrolled in Medicaid under an expansion that allowed more low- and middle-income earners to qualify for the government health insurance program. About 70,000 Nebraskans enrolled in Medicaid through the expansion, out of the roughly 346,000 Medicaid recipients in the state. 

House Speaker Mike Johnson, a Republican from Louisiana, in 2025 described the new requirements as a way to cut "fraud, waste and abuse" in Medicaid. 

However, several experts warn the restrictions could hinder access, with The Urban Institute estimating that the changes may result in up to 10 million people losing Medicaid coverage in the next two years.

"Nebraska going early is going to allow us to kind of see what might be working, what aspects of implementation may not be working," said Jennifer Tolbert, deputy director of KFF's Program on Medicaid and the Uninsured, in an online event on Thursday focused on the work requirements. 

About 25,000 Medicaid enrollees in Nebraska could lose their health insurance under the new rules, or about 36% of those subject to the restrictions, according to the Urban Institute. 

The new rules apply to Medicaid expansion enrollees aged 19 to 64. who must show they are working or performing community service for at least 80 hours a month, or are at least part-time students. There are some exemptions, including for people with medical issues, pregnant women and caregivers of disabled people.

Many losing coverage are enrollees who meet requirements but are dropped for paperwork issues or failure to prove exemptions, such as being disabled, the group said.

Recipe for chaos?

Three other states plan to implement the Medicaid work requirements by year-end: Iowa, Montana, and Nebraska. Montana has signaled it will start enforcing the rules on July 1, while Iowa will implement them Dec. 1, according to KFF.

Yet even as Nebraska moves forward with the new Medicaid rules, many questions remain about how to implement the policy, health care experts said. For instance, states are still waiting for guidance from federal authorities on how to define an enrollee in the program as "medically frail," which is one of the exemptions from the work requirements, a KFF analysis found.

Because the "big beautiful bill," which President Trump signed into law in 2025, requires the rules to be instituted by Jan. 1, 2027, many states are still developing plans to implement them, KFF said.

Amy Behnke, CEO of the Health Center Association of Nebraska, told the Associated Press that staff members who help people enroll in Medicaid and their clients have questions that the state hasn't yet answered. For example, people who travel to a hospital for care are exempt from the work rules, but it's not clear how far the journey has to be to qualify, she said.

"The speed at which we are choosing to implement work requirements hasn't left a lot of space for really meaningful communication," Behnke said.

Frail rate

Other U.S. states are now working through their plans and hiring more state workers or contractors to handle the additional work, KFF found in its analysis. Six states plan to use artificial intelligence to help with processing documents and data matching, according to the health policy research firm.

One major issue facing states is how to prove someone is "medically frail," which the "big beautiful bill" says includes people who are blind or disabled; those with physical, intellectual or developmental disabilities; individuals with substance use disorder or a "disabling" mental disorder; or those with "serious or complex" medical conditions.

States are grappling with whether they can use medical claims to verify medical frailty or rely on enrollees' self-declarations, said Kate McEvoy, executive director of the National Association of Medicaid Directors, during KFF's webinar.

In a statement in December, Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, applauded Nebraska for announcing it would be the first state in the nation to introduce the new work requirements, describing the early rollout as showing the state's "commitment to helping more Nebraskans move toward greater independence and opportunity."

In the same statement, Nebraska Gov. Jim Pillen described the new rules as helping Medicaid recipients win "greater self-sufficiency through employment and other meaningful activities." 

As of February, Nebraska had one of the lowest unemployment rates in the U.S., at 3.1%, compared with a national jobless rate that month of 4.4% (Unemployment fell to 4.3% in March.)

Learning from Arkansas and Georgia

Some experts are skeptical that Medicaid work requirements will spur more program participants to get jobs, pointing to what happened in two states, Georgia and Arkansas, that enacted similar rules several years ago.

Arkansas' requirements failed to boost employment, according to an analysis from researchers at Harvard University's T.H. Chan School of Public Health. But about 18,000 adults in the state lost health care coverage after the policy went into effect, with more than half reporting that they delayed medical care and more than 6 in 10 saying they delayed taking medications because of cost. 

Arkansas dropped the mandate after a court struck it down in 2019, a year after it was implemented. 

Georgia's program proved costly, with a pricetag of $110 million, and rejected about 60% of Medicaid applicants, often for paperwork issues such as failing to provide a birth certificate or driver's license, according to the Georgia Budget and Policy Institute, a state-focused think tank. Over its first two years, the program enrolled about 8,000 Georgians. 

"At their core, work requirements keep people from or take away health coverage, and indeed people will lose coverage by the millions, even if they are eligible," the Center on Budget and Policy Priorities, a nonpartisan think tank, said in a report this week. "This conclusion is supported by ill-fated, real-world experiences in Arkansas and Georgia."