One Big Beautiful Bill (OBBB) Act: Medicaid Coverage churn will rise—especially among adults 19–64
A practical playbook for HCBS & LTSS leaders (with actions across workforce, compliance, client support, and advocacy)
Coverage “churn” is when someone loses Medicaid for a short time and later re-enrolls. It interrupts care, increases no-shows and unpaid balances, and burns staff time. The One Big Beautiful Bill Act (OBBB) bakes in new churn risks for working-age adults—but providers can blunt the impact with smart operations and clear client education. Here’s what’s changing, why it matters, and how to respond—mapped to your four priority lanes.
What’s changing
Six-month renewals for expansion adults. States must re-determine eligibility twice a year for ACA expansion enrollees beginning the first quarter after December 31, 2026—that means more frequent paperwork and more points where coverage can lapse.
“Community engagement” (work requirement) is now an eligibility condition. Expansion adults must document 80 hours/month of work, school, workforce program, community service, or a combination; states verify at application and renewal (and can check more often). Exemptions and short-term hardship options apply, but states can’t waive the requirement.
Shorter retroactive coverage. Starting Q1 2027, retro periods shrink to 1 month for expansion adults and 2 months for others (CHIP also to 2 months). If intake happens before coverage starts, you’ll have less room to salvage payment.
Program-integrity rails tighten. States must:
run multi-state duplicate-enrollment checks (monthly SSN submissions to a new CMS system by FY2030), and
do quarterly Death Master File checks for enrollees and for providers (from 2028).
These generate more “status changed—act now” events your teams must reconcile.
Cost-sharing for some expansion adults (from FY2029). Copays up to $35 per item/service with a 5% of family income monthly cap; key exclusions apply (e.g., primary care, mental health/substance use disorder services, FQHC/CCBHC/RHC). States may let providers require payment at point of service.
Why this spikes churn: More frequent renewals + new monthly activity documentation + tighter data checks = more opportunities for procedural terminations (people who still qualify but lose coverage due to paperwork or verification timing). KFF defines churn as temporary loss and re-enrollment often tied to exactly these administrative frictions.
Summary timeline
Q1 2027: Six-month redeterminations begin for expansion adults; retro coverage shortens.
2027–2030: CMS duplicate-enrollment system phases in; monthly SSN reporting required by FY2030. DMF checks for enrollees/providers begin 2028.
FY2029: Cost-sharing for specified expansion adults starts (state-implemented).
What this means for your operation
1) Workforce development
Goal: Equip your front-line teams to prevent avoidable lapses.
Build “benefits navigation” skills into supervisor, scheduler, and intake training: what counts for 80 hours, common exemptions, what proof is acceptable, and how to coach clients to document it. Use quick-reference scripts and checklists.
Create specialist roles (or upskill current staff) who monitor renewal calendars and cost-share flags and who can triage issues before a shift is missed or a claim is denied.
Tie micro-credentials to retention: short modules on eligibility basics, documentation, and respectful cost-share conversations boost confidence and reduce escalation.
2) Compliance adherence
Goal: Prevent “erroneous excess payments” and strengthen audit-proof files.
Redesign intake & recert SOPs around the 6-month renewal clock: auto-texts/mailings 60/30/10 days out; supervisor sign-off for high-risk cases (job changes, school enrollment, address moves).
Add a pre-service eligibility checkpoint for first visits following a status change (new job, school, recent hospitalization) since these directly affect community-engagement standing.
Stand up a “program-integrity playbook”: document quarterly Death Master File reconciliations and workflows to resolve CMS duplicate-enrollment flags; track actions and timestamps for audit trails. Payments when eligibility is insufficiently documented can be treated as erroneous excess payments starting FY2030.
Tighten revenue-cycle guardrails for the shorter retro window: require benefits applications within 48 hours of referral; push real-time eligibility checks before starting services.
3) Client support
Goal: Keep eligible people continuously covered and reduce financial surprises.
Plain-language, multilingual education kits covering:
how to document the 80 hours (with examples),
six-month renewal timing,
who might face copays in FY2029 (and who is exempt), and
why applying sooner matters under the shorter retro window.
Warm referrals for transportation, food, caregiver stress, and dementia supports—stabilize households so they can meet new requirements and keep appointments.
Small-balance workflows for any required copays: point-of-service estimates, automated 5% family cap tracking, and a clear hardship exception path consistent with state rules.
4) Advocacy
Goal: Shape state rules to minimize harmful churn.
Ask your Medicaid agency (perfect conversation starter in Baltimore):
How will verification be as automated as possible at renewal (ex parte), and what will documentation look like for 80 hours?
What notice templates (multilingual) and data feeds (for providers and MCOs) will support renewals and cost-share flags?
How will the state implement the duplicate-enrollment system and DMF checks with minimal disruption?
Promote consumer-friendly policies: reasonable exemption lists, hardship pathways, alignment of renewal cycles with available data, and rapid reinstatement when terminations are erroneous. (CMS’ 2024 streamlining rule—now delayed to FY2035—was designed to reduce paperwork and disruptions; use it as a north star for state choices even during the delay.)
Simple explainer you can share with your team
“What counts for the 80 hours?”
Work for pay, approved job-training, community service, or school at least half-time—or any combination adding up to 80 hours/month. Some people are exempt (e.g., serious medical conditions; parents with children 13 and younger). States verify at application and renewal.
“What if someone misses paperwork?”
Coverage can stop—even if the person still qualifies. Help clients submit on time; if they’re cut off by mistake, trigger a fast appeal/reinstatement with your MCO contacts.
“Will everyone have copays?”
No. Only certain expansion adults over poverty, starting FY2029, and many services are exempt (e.g., primary care, MH/SUD, FQHC/CCBHC/RHC). Family copays can’t exceed 5% of income per month.
Metrics to watch (and bring to payer/State meetings)
Renewal success rate (kept coverage / due for renewal)
Average days from referral to benefits application
Denials tied to documentation vs. true ineligibility
Copay collection rate on applicable services and hardship approvals
Roster match rate with MCO files after monthly eligibility updates
Bottom line
Churn is predictable and manageable. If you:
upskill your team on benefits navigation,
hard-wire six-month renewal workflows,
get ahead of retro/cost-share exposures, and
push for consumer-friendly state implementation—
you’ll protect continuity for the people you serve and reduce financial risk for your organization.
References (APA)
Congress.gov. (2025, July 4). H.R. 1—One Big Beautiful Bill Act (Public Law 119-21): Health subtitle (Secs. 71101–71121). Retrieved August 21, 2025, from the Library of Congress website. (Congress.gov)
Centers for Medicare & Medicaid Services (CMS). (2024, Mar. 27). Streamlining the Medicaid, Children’s Health Insurance Program, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes—Fact Sheet. (CMS)
KFF. (2021, Dec. 14). Medicaid enrollment churn and implications for continuous coverage policies. (KFF)
