Proposed changes to the federal Medicaid program announced last week by the Centers for Medicare and Medicaid Services are drawing alarm from healthcare advocates in Texas, where nearly five million residents — including more than two million children — depend on the program for their health insurance coverage, and where access to care already lags significantly behind national averages.
The proposed rule changes, which CMS has put out for a 60-day public comment period, would give states greater flexibility to impose work requirements on certain adult Medicaid recipients, tighten eligibility verification processes, and adjust reimbursement formulas in ways that could reduce federal matching funds flowing to states. Healthcare advocates say the cumulative effect in Texas could be the loss of coverage for hundreds of thousands of people.
“Texas already has one of the highest uninsured rates in the country, and these changes could make a very difficult situation significantly worse,” said Dr. Elena Garza, executive director of the Texas Health Policy Institute. “Work requirements sound reasonable in the abstract, but the evidence is clear that they primarily result in eligible people losing coverage due to administrative complexity, not because they actually don’t meet the requirements.”
Texas has among the most restrictive Medicaid eligibility rules in the nation, having declined to participate in the Affordable Care Act’s Medicaid expansion that was adopted by most other states. As a result, the Texas Medicaid program primarily covers children, pregnant women, elderly residents, and people with disabilities — leaving a large coverage gap for low-income working-age adults who earn too much to qualify for Medicaid but too little to afford marketplace insurance plans.
The proposed work requirement provisions would apply primarily to able-bodied adults without dependents — a category that represents a relatively small share of Texas Medicaid recipients given the state’s eligibility structure, but advocates warned that the administrative burden of proving compliance could lead many eligible Texans to lose coverage inadvertently.
Texas Republican lawmakers largely welcomed the proposed flexibility, with several members of the congressional delegation issuing statements supporting the work requirement provisions as a means of encouraging self-sufficiency and reducing long-term Medicaid dependence. Representative Chip Roy called the changes “a commonsense step toward sustainable healthcare policy.”
Healthcare providers, including hospital systems and community health centers that serve large Medicaid patient populations, expressed greater concern. Texas Hospital Association President John Hawkins said the reimbursement formula changes could put significant financial strain on safety-net hospitals in low-income urban and rural areas that depend on Medicaid funding for operational viability.
Texas Health and Human Services Commission officials said they were reviewing the proposed rules and would submit formal comments through the CMS process. The commission noted that any final rules would require an assessment of state budget and operational impacts before Texas could determine how to implement them.
Public comment on the proposed rules closes in late April, with final regulations expected later in 2026. Advocacy organizations urged Texans who depend on Medicaid or work in healthcare settings to submit comments during the public period and to contact their congressional representatives.
