Leveraging Managed Care Plans to Support Implementation of Medicaid Work Reporting Requirements

Oct, 24, 2025

Leveraging Managed Care Plans to Support Implementation of Medicaid Work Reporting Requirements

Ellen Montz, Kinda Serafi, and Michelle Savuto, Manatt Health

Background

Managed care plans (MCPs) are well-positioned to support state Medicaid agencies as they develop their policy, operational and information technology (IT) system plans to implement federally mandated work reporting requirements. Specifically, MCPs have robust data systems and reporting tools, established care management infrastructure and staffing, member communication channels, and extensive provider networks and community-based partnerships —all of which are capabilities and resources that can be leveraged to support implementation of new federal work reporting requirements policy.

While MCPs cannot make determinations of work reporting compliance or exemptions under H.R.1,^[1] they can provide states with data analysis, evidence, and recommendations which states can use to make determinations. MCPs can also take on valuable outreach, direct assistance to enrollees, and can do so in collaboration with providers and community partners.^[2] For example, MCPs played a critical role during the Medicaid unwinding period, supporting outreach and education efforts for enrollees and community partners, and helping state agencies update enrollee contact information to reduce churn and ensure continuity of care. MCPs can also act as key partners in supporting states’ implementation goals of ensuring eligible expansion adults enroll in and stay enrolled in Medicaid during periods of policy or process changes that affect eligibility and enrollment. This expert perspective describes MCP partnership strategies to support the implementation of work reporting requirements to promote continuity of coverage and minimize procedural disenrollment risks.^[3]

Identifying Exemptions Through Claims/Encounter Data and Care Management Systems and Staff

H.R.1 expressly exempts certain individuals from mandatory work reporting requirements. This includes, for example, individuals participating in a substance-use or alcohol use treatment program and individuals who have a disabling mental disorder; substance-use disorder (SUD); serious or complex medical condition; or a significant physical, intellectual, or developmental disability.^[4]By leveraging their (1) claims and encounter data; and (2) care management systems and staff administrative data, MCPs can play a critical role in identifying individuals who meet exemption criteria.

For example, through billing claims from providers, MCPs have diagnosis and procedure code data to identify individuals who may be eligible for an exemption.^[5] States with timeliness requirements on MCPs for claims adjudication and near real-time encounter data reporting may already have actionable data to leverage to identify potentially exempt individuals. States without timely access may want to consider imposing new data reporting requirements on MCPs, given that MCPs might receive claims data significantly in advance of when the state does.^[6]

MCPs may also leverage existing data or collect new data for reporting to the state from their care management systems and processes. These systems contain rich, member-level data that can be used to flag exemptions. For example, MCPs could monitor their care and utilization management systems for hospitalizations, diagnoses, or indications of circumstances that could exempt enrollees from work reporting requirements and report these to the state.^[7],[8] MCPs could also require their care managers to help identify their members, based on health risk assessments, care plans, and care needs assessments, who may be exempt from work reporting requirements and share this information with the state for a determination. The state could also develop and require plan or provider-based care managers to administer additional tools (e.g., a screener or checklist) to identify exemptions and share this information with the state.

Conducting Member Outreach and Engagement

States can partner with MCPs to assist members in understanding and complying with work reporting requirements. MCPs may take a range of potential actions that vary in resource intensity from broad engagement to direct member support.

Broad Engagement (Low Intensity): MCPs can conduct broad-based education and outreach through mailers, call centers, member handbooks, websites, videos, provider networks, and contact members via phone calls or federally-compliant text messaging. This outreach will build upon the requirement that MCPs support states in updating member contact information (as required by H.R.1, effective January 1, 2027).
Strategic Outreach (Moderate Intensity): MCPs or their care managers can engage specific populations of focus (e.g., individuals nearing the end of the 30-day compliance window or those likely to be disenrolled); and/or manage deployment of community health workers, peer navigators, and community-based organizations to conduct tailored outreach and identify qualifying activities like volunteer opportunities in the community. MCPs could also push alerts to community-based primary care and behavioral health providers when patients are on the at-risk timeline to engage them in office or outreach channels, such as through their patient portals.
Direct Member Support (High Intensity): MCPs and their care managers can assist members in completing and submitting information, connect individuals to employment supports and qualifying activities, and/or follow up with disenrolled individuals. For example, MCPs could assist individuals in responding to requests for information regarding their compliance with or exemption from work reporting requirements. MCPs could also provide General Education Development (GED) classes directly as highlighted by Blue Shield of California’s Promise Health Plan’s partnership with a GED Testing Service.

For all of these strategies, states are encouraged to require that MCPs conduct outreach and engagement that is culturally competent and accessible to individuals with limited English proficiency, digital literacy, or disabilities. MCPs may need to develop new training materials to ensure consistent messaging across staff and partners.

Implementation Considerations

When assessing the role of MCPs in supporting work reporting requirements, states will first want to conduct a baseline analysis on claims/encounter data availability and timeliness within their own systems and MCP systems.

MCPs provide a promising source of data and partnership when it comes to compliance, but they are only one important source to help ensure eligible individuals gain and do not lose coverage. Specifically, to maximize efficiency of resources and minimize enrollee confusion, states should establish strategic hierarchal automated processes^[9]to first identify individuals who are exempt (e.g., parents and guardians with children under age 13; American Indians/Alaska Natives; individuals who are pregnant and postpartum; individuals who are blind and disabled ) or in compliance [e.g., earning at least $580/month (federal minimum wage x 80 hours in 2025)] before activating MCP data exchange and outreach activities.

Additionally, states may wish to leverage their previous experiences and lessons learned supporting members in collaboration with MCPs during the Medicaid unwinding period. States should not only consider successful strategies implemented during unwinding but also examine implementing new strategies through consultation with MCPs as well as with enrollees through the Medicaid Advisory Committee and Beneficiary Advisory Councils.

States may need to formalize changes in MCPs’ roles and responsibilities through contract amendments and modified data sharing processes.^[10]And, as a best practice, but particularly in light of difficult implementation timelines, states may establish monitoring and performance metrics to assess MCPs’ ability to identify potential compliance/exemptions, complete outreach and member support activities, and prevent coverage loss due to paperwork or other procedural barriers. Processes may need to be retooled or retired as states learn how best to keep eligible individuals enrolled.

Conclusion

Evidence lays bare that work reporting requirements lead to coverage loss because individuals get caught in difficult and confusing reporting and paperwork requirements rather than because they are non-compliant with the underlying rules of the program. Medicaid work reporting requirements are projected to lead to significant coverage loss for millions of people, particularly people of color, individuals with disabilities, rural communities, and other groups. States will need to use all of the policy and operational levers at their disposal, including leveraging the full capabilities of MCPs, to ensure continuity of coverage for eligible individuals. While additional guidance from CMS is forthcoming, states can act now to engage MCPs in their implementation planning and activities.

[1] H.R.1 states: “A State shall not use a Medicaid managed care entity or other specified entity (as such terms are defined in section 1903(m)(9)(D)), or other contractor to determine beneficiary compliance under such section unless the contractor has no direct or indirect financial relationship with any Medicaid managed care entity or other specified entity that is responsible for providing or arranging for coverage of medical assistance for individuals enrolled with pursuant to a contract with such State.”

[2] States can contract out work reporting requirements determinations to Primary Care Case Management or vendors unaffiliated with any MCP. The state should monitor for compliance but is not required to review each individual determination.

[3] State laws may prohibit certain activities.

[4] For the full list of exemptions, please refer to the SHVS toolkit, “Medicaid Work Reporting Requirements: Verifying Compliance and Exemptions.”

[5] For members identified as potentially exempt based on claims/encounter data.

[6] States may consider conducting an analysis to inform decision making around potential new data reporting requirements.

[7] Some MCPs have case management designations to automatically exempt a person [e.g., California’s Enhanced Care Management (ECM) program] or are enrolled in the highest level of care management program intervention, such as North Carolina’s Tailored Plans.

[8] Some of this same information and potentially more may be available through a state’s Health Information Exchange. States may analyze which existing data and process flows already deliver this information to the Medicaid agency or MCPs as they build their work reporting requirement system and business processes.

[9] For more information on strategic hierarchy in data verification see SHVS’ toolkit, “Strategic Verification Hierarchy for Medicaid Work Reporting Requirements.”

[10] Suggested timing for managed care contract updates is from January 1, 2026 to June 30, 2026. For other related implementation partners, suggested timing for contract updates is from April 1, 2026 to September 30, 2026, as applicable (e.g., care management and assister entities, if directly contracted by the state). More information is available in SHVS’ toolkit, “Medicaid Work Reporting Requirements: Implementation Planning Milestones.”