Congress gave final approval on July 3, 2025, to H.R. 1, a budget reconciliation law that Disability Scoop reported cuts almost $1 trillion from Medicaid. President Donald Trump signed it July 4.
Provisions to watch in disability services
The law includes:
- Work requirements: states must require many adults in the Medicaid expansion group to show community engagement, starting no later than the first quarter after Dec. 31, 2026. CMS later issued guidance on the "medically frail" exemption.
- More frequent eligibility checks: states must redetermine eligibility every six months for expansion adults, for renewals starting after Dec. 31, 2026.
- A new HCBS waiver option: starting July 1, 2028, states may run a standalone 1915(c) waiver for people who do not meet an institutional level of care. States must show it will not materially lengthen waits for existing waivers and that per-person costs will stay below the average for institutional care.
- Provider taxes: the law limits how states can use provider taxes to fund their share of Medicaid.
Why this mattered for providers and DSPs
The work requirements and six-month checks apply to adults in the expansion group, not to people who qualify for Medicaid through disability-based pathways. But lower federal funding puts pressure on optional home and community-based services and provider rates. Advocates told Disability Scoop that more paperwork could cost eligible people their coverage. For DSPs who get their own health coverage through Medicaid expansion, the new rules could also affect their insurance.