The Verification Flow: Before & After HR1 Medicaid Work Requirements
Money-Flow Diagram № 3 · Verification
HR1 § 71119 · Community Engagement Requirements
Medicaid Work Requirements · Compliance Mechanics
How HR1 actually verifies you're working.
Most coverage between Medicaid agency and provider runs on claims paperwork — but work-requirement verification runs on a completely separate track. Providers never see your work hours. The state matches data first, asks you for proof only when matching fails. This is where a structural data gap is about to create coverage losses for millions of eligible people.
First thing to know
Provider claims and work-hour verification run on separate pipes.
The hospital, doctor, or managed-care plan billing your Medicaid coverage never asks about your work hours. They just submit a claim the way they always have. Your eligibility is determined upstream — at application and at renewal — and the verification check happens entirely between you, the state Medicaid agency, and a set of databases.
If you're eligible on the day you walk into the ER, your claim gets paid. If you've been disenrolled because the state couldn't verify your hours, your claim gets rejected at the eligibility check — but the provider never gets pulled into the work-requirement question itself.
View
Watch the verification path. Solid green = success route. Dashed red = failure route to coverage loss.
Verification before HR1
Pre-2027 baseline · annual renewal, no work check
Process flow
Coverage continues
Path to disenrollment
New step (HR1 only)
Annual eligibility renewal, before HR1
How it worked before January 1, 2027
Where the verification system breaks
The law's design — match data first, ask the person second — only works if the state's data sources can find the activity. They can't. Five of ten qualifying activities produce no record a state Medicaid agency can match against. Those five are exactly the activities most common among low-income enrollees who don't hold W-2 jobs.
● Captured
W-2 employment
Employers report quarterly to state UI agencies. The gold standard data source. Easy to verify automatically.
● Captured
In-state college / CTE
State higher-ed data systems usually share enrollment status with eligibility systems via existing MOUs.
● Captured
SNAP / TANF work program
Sister agencies share records. If you meet SNAP work requirements, that satisfies Medicaid's automatically.
◐ Partial
1099 / gig work
May appear in tax records, but with delay. Real-time hour tracking is generally invisible to states.
◐ Partial
Out-of-state schooling
No data-sharing agreement with another state's universities. Burden shifts to the enrollee for proof.
◐ Partial
Job training programs
Captured only if the program reports to the state. Most private/nonprofit-run programs don't.
○ Invisible
Volunteer hours
No state agency tracks volunteer hours systematically. Yet community service is a qualifying activity.
○ Invisible
Community service
No central registry exists in any state. Court-ordered service is recorded by courts but not shared with Medicaid.
○ Invisible
Caregiving for relatives
Unpaid family caregiving qualifies for some exemptions, but isn't captured in any state database.
○ Invisible
Cash-paid informal work
Day labor, household work, and informal service work produce no electronic record at all.
Why this matters for CHC
The volunteer-hours gap is the gap CHC was already built to fill.
CHC's No Wrong Door volunteer hour tracking initiative sits exactly on the seam where state verification systems fail. The 4,000+ partner organizations in CHC's network engage millions of volunteer hours annually — hours that currently produce no electronic trail any state Medicaid agency can match against.
If those hours can be captured, standardized, and exported in a format state Medicaid IT systems can ingest, every NWD-tracked volunteer becomes a person who passes ex parte verification automatically — without ever receiving a notice, without filling out paperwork, without risking procedural disenrollment.
The window to claim this position is narrow. CMS must publish its interim final rule by June 1, 2026, and states are already selecting eligibility-system vendors and writing data specs. A working prototype before Q1 2026 puts CHC in the room when those specs get finalized. After the rule publishes, the conversation is about adapting — before, it's about defining.
For the full strategic case, see the companion brief: Positioning CHC in the HR1 Verification Gap.
Definitions — terms used on this page
Ex parte verification
Latin for "from one side." The state checks its own data sources to verify compliance without involving the enrollee. HR1 requires this be tried first, before any paperwork burden falls on the individual.
Community engagement requirement
HR1's term for the work requirement. 80 hours/month of work, school, training, community service, or some combination. Applies to ACA expansion adults aged 19–64 who are not exempt.
Lookback period
For new applicants: the 1–3 month window before application that the state checks for compliance. For renewals: any one month within the prior 6-month eligibility period counts.
Notice of noncompliance
When the state can't confirm compliance from data alone, it must send written notice (mail + one other channel: text, phone, email) giving the enrollee 30 calendar days to submit documentation.
Specified excluded individuals
HR1's term for who's exempt. Includes pregnant people, parents/caregivers of disabled people, people in substance-use treatment, the medically frail, and several other categories.
Procedural disenrollment
When an eligible person loses coverage because of paperwork failures — missed deadlines, lost mail, system errors — rather than actually failing the eligibility test. Arkansas's experiment showed this is the dominant failure mode.
Interim final rule
A federal regulation that takes effect immediately while accepting public comment. CMS must publish one for HR1 work requirements by June 1, 2026. It will define the technical implementation standards states must follow.
Good faith waiver
A delay states can request from CMS, extending implementation up to December 31, 2028. Granted based on the state's demonstration of significant barriers, detailed plan, and progress.
Single Streamlined Application
The federal-required Medicaid application form. States may need to add new questions about work activity to capture compliance data at application — adding friction at the enrollment door.
Federal data services hub
Existing federal infrastructure states use to verify SSNs, citizenship status, incarceration status, and Title II benefits. Could (but doesn't yet) include work activity data.
Encounter data
Medicaid claims and managed-care utilization records. The state already has these. HR1 says they can be used to identify exemptions — for example, evidence of regular treatment for a chronic condition.
Fair hearing
A formal appeal right enrollees have if their coverage is terminated. HR1 preserves this — but it operates after coverage has already been lost, not before.
Resources for state agencies, partner organizations, and advocates
Organization & document
What it covers
Best for
CMS CMCS Informational Bulletin (Dec 8, 2025)
First official federal guidance. High-level — leaves operational specifics for the June 2026 IFR. Confirms ex parte requirement and outreach timelines.
Federal
SHVS — Implementation Basics & State Decision Points
State Health & Value Strategies brief covering operational design choices states must make before federal rules drop. The most practical state-side guide.
State Plan
SHVS — Verifying Compliance & Exemptions
Detailed look at which data sources can verify which activities, and which questions states will need to add to applications to fill gaps.
Technical
CBPP — Reducing Coverage Losses Through Effective Implementation
Center on Budget and Policy Priorities guide on policy choices that minimize procedural disenrollment. Strong evidence base from Arkansas.
Advocacy
Georgetown CCF — State Readiness Tracker
State-by-state readiness analysis based on 8 eligibility-system performance metrics. Identifies states most at risk for poor implementation.
Diagnostic
CHCS — Federal Medicaid Work Requirements Summary
Center for Health Care Strategies overview of statutory provisions, exemption categories, and implementation timeline.
Reference
KFF Medicaid Work Requirements Tracker
Ongoing tracking of state implementation choices, waiver requests, and coverage-loss estimates. Updated as states announce decisions.
Reference
Sommers et al. (Health Affairs, 2019)
The definitive academic study of Arkansas Works (2018). Documents the procedural-disenrollment failure mode HR1's design tries to avoid.
Evidence
State Medicaid agency websites — FAQ pages
Many states (Colorado leading example) have begun publishing public FAQs as members get questions. Track these to see how states are framing it.
State-level
Sources
HR1 / P.L. 119-21 §71119 (community engagement requirements) · CMS Center for Medicaid & CHIP Services Informational Bulletin, December 8, 2025 · State Health & Value Strategies (SHVS) implementation guides, August–November 2025 · Center on Budget and Policy Priorities (CBPP) implementation guide, November 2025 · Georgetown Center for Children and Families implementation readiness tracker, September 2025 · Center for Health Care Strategies summary, December 2025 · Sommers et al., "Medicaid Work Requirements In Arkansas: Two-Year Impacts" (Health Affairs, 2019). The verification flow shown here simplifies reality — actual state implementations will vary based on data systems, vendor choices, and policy elections made under the eventual June 2026 interim final rule.
