Starting today, federal Medicaid matching rules narrow who counts as eligible for full coverage under Section 71109 of Public Law 119-21—the statute CMS April 8 State Health Official letter (SHO #26-001) calls the Working Families Tax Cut legislation.
CMS told states that, beginning Oct. 1, 2026, federal financial participation for most non-emergency Medicaid (and related CHIP) coverage is generally limited to U.S. citizens and nationals, lawful permanent residents, Cuban/Haitian entrants, and Compact of Free Association migrants. Groups that often received full coverage sooner under prior law—such as refugees, asylees, and certain trafficking victims—lose that federal match unless they qualify under a remaining category.
KFF Health News reported Sept. 30 that green-card holders are largely spared, while state agencies in nine states plus D.C. identified more than 281,000 immigrants at risk of losing Medicaid in October—including nearly 177,000 in Florida, about 29,000 in North Carolina, nearly 28,000 in Arizona, 15,000–25,000 in New Jersey, and about 11,000 in Washington. The Congressional Budget Office estimated the eligibility change would leave about 100,000 more immigrants uninsured by 2034.
Why this matters
Coverage losses hit people with disabilities who use Medicaid for HCBS as well as direct care workers and DSPs who rely on Medicaid themselves. Provider agencies should expect eligibility churn, appeal traffic, and disrupted service authorizations wherever immigrant enrollees lose federal match. States that keep coverage with state-only dollars will face budget trade-offs that can squeeze disability waiver capacity.