Recent federal changes to Medicaid eligibility are expected to shift millions of Americans off public coverage in the coming years.
Where many of them land next could have an impact on your group health plan.
Understanding what is inside your plan today puts you in a much better position when those changes begin to show up in your numbers.
The Overlooked Side of Medicaid Reform
On July 4, 2025, the One Big Beautiful Bill Act was signed into law. Among its many provisions, it makes significant changes to who qualifies for Medicaid and how that eligibility is maintained.
A few of the changes to be aware of:
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Starting January 1, 2027, Medicaid recipients will need to meet work requirements of 80 hours per month through employment, training, or volunteer activities to maintain their coverage.
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By December 31, 2026, states will be required to conduct Medicaid eligibility redeterminations at least once every six months, which adds administrative pressure and is expected to move people off the rolls, including some who remain technically eligible.
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The Congressional Budget Office estimates these changes will result in 11.8 million individuals directly losing their Medicaid coverage.
When people lose public coverage, they typically do not just go without insurance.
Many seek employment, or turn to a working family member, and land on an employer-sponsored group health plan.
This movement is called Medicaid churn. It is not new, but the scale of it connected to these reforms makes now a good time to pay attention, well ahead of your next renewal.
What This Could Mean for Your Health Plan
When formerly Medicaid-covered individuals move onto employer plans, a few things tend to happen:
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Enrollment increases in ways that can be difficult to anticipate during the planning cycle
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Claims risk shifts, particularly around maternity, chronic condition management, and age-related utilization
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Budget exposure changes before finance teams have had a chance to model it
The challenge is timing.
By the time the impact appears in your renewal number, it is already reflected in the data. The cost is already being justified by the carrier.
Getting a clearer picture ahead of renewal season puts you in a much stronger position to respond thoughtfully rather than reactively.
Getting Ahead of It
A proactive approach does not have to be complicated. Here is where to start:
Understand your current claims picture. What does your plan look like today across utilization categories? Where is the spend concentrated? A clear baseline makes it easier to spot changes early.
Think through enrollment scenarios. If your workforce includes dependents or employees who may have had family members on Medicaid, it is reasonable to consider how an enrollment shift could affect your plan’s cost structure.
Review your plan design. Some plan structures are better positioned to absorb enrollment changes. This is a reasonable time to revisit yours with a fresh set of eyes.
Bring leadership into the conversation early. Arriving at a renewal meeting with data and a clear strategy is a very different experience than reacting to a number after the fact.
If you would like to understand where your plan stands before the next renewal arrives, we are glad to walk you through it.
