Prove It

Or you lose

Starting January 1, if you’re a disabled adult on Medicaid expansion, having a disability will no longer be enough to be exempt from the new work requirements. You’ll have to prove that your disability significantly impairs your ability to work eighty hours a month.

The story people are being told about why this is necessary and the story the government’s own inspector general published recently aren’t the same.

What actually changes

The 2025 reconciliation law requires states to condition Medicaid eligibility for expansion adults on eighty hours a month of work or qualifying activity, such as school or volunteer work, starting January 1, 2027. The law exempts people who are “medically frail,” and it names five categories:

-Blind or disabled
-Having a physical, intellectual, or developmental disability that limits activities of daily living
-Substance use disorder
-Disabling mental disorder
-A serious or complex medical condition.

That sounds like a real exemption. Congress wrote it as one.

On June 1, CMS issued a nearly four-hundred-page interim final rule interpreting it. The rule says states can’t expand beyond those five categories, and that being in one of them isn’t sufficient on its own. The condition must also significantly impair your ability to meet the eighty-hour requirement, and you have to document that.

CMS said that having a condition on your state’s list will not automatically make you exempt. The paperwork becomes the answer.

CMS’s own estimate is that this will reduce Medicaid enrollment by 2.3 million people in fiscal 2027, rising above 3 million after that. That’s the agency’s projection of how many people its rule removes. Nobody is arguing about that number, because the government published it.

Twenty-five states and DC sued over it. On July 30, a federal judge in Massachusetts declined to pause the rule while the case proceeds, on the grounds that the states hadn’t shown irreparable harm since CMS agreed to reimburse ninety percent of their implementation costs. He explicitly didn’t rule on whether the rule is lawful. That comes later, before January.

Worth noting what the states were arguing about. They said they don’t have the staff to build this by January and that it would cause harm and chaos. The judge said the money’s reimbursable.

The money is always reimbursable. The chaos isn’t.

It already started

On August 1, Nebraska became the first state in the country to remove people from Medicaid for failing to meet the new work requirements. Roughly two hundred people lost coverage that day.

Nebraska didn’t have to do this yet. The federal deadline is January. The state’s Medicaid director, Drew Gonshorowski, said they went early in part because he believes the rules will help people move toward economic stability. His words were “why wait.”

Here’s what you should know about Nebraska before you decide what this means.

It’s close to the “best” possible version of this. The state runs its own eligibility system, which many don’t. It can confirm compliance for about three quarters of affected people automatically, without ever contacting them. It has roughly seventy thousand people subject to the requirements, which is small enough for a hands-on process. It sent tens of thousands of letters, texts, and emails, and ran radio and TV ads. Gonshorowski said his team built in extra steps, reviewing every denial multiple times before it went out, because they don’t want people falling through the cracks.

Two hundred people fell through anyway.

And even in the best case, the friction showed up immediately. Advocates said the state’s notices were confusing and left low-income people unsure whether the rules applied to them at all. Reporters testing the state’s Medicaid help line hit long waits, a dropped call, and trouble getting through on the Spanish-language line.

Now think about the other forty-three states. Most are bigger. Many run eligibility systems that can’t automate three quarters of anything. None of them got the extra months Nebraska took. All of them have to do this by January.

The estimates of how many people lose coverage nationally range from three million to 8.6 million by 2028. That spread should tell you something about how confident anyone actually is.

But a big issue to be faced in the future is what Gonshorowski said he’s watching. He said appeals and fair hearings are the real measure of whether a state got it right, and that what keeps him up at night is a state getting it badly wrong because it missed that someone had a disability, or missed that they had earned income every month. He called that the one scary number.

The man running the first implementation in America named the failure mode himself, unprompted, and the failure mode is missing that someone is disabled.

The first Americans to lose coverage under this law lost it in the state that tried hardest to get it right.

Why we’re told this is necessary

For more than a year, the administration’s public case has been that people are stealing from these programs, and specifically that immigrants are. In May, Vice President Vance warned about tens of billions in fraudulent California payments going to undocumented people. The head of CMS claimed hundreds of millions in questionable expenditures tied to immigration. Stephen Miller went ahead and blamed the national debt on it.

If that’s true, then verification requirements make sense. We’re not cutting anyone off, we’re just checking.

What the government’s own report found

In July, the HHS Office of Inspector General submitted its semiannual report to Congress, covering enforcement actions from October 1, 2025 through March 31, 2026.

The money is at the top.

The CEO of a health care software company ran a telemedicine and durable medical equipment scheme worth more than a billion dollars, and was sentenced to fifteen years and $452 million in restitution. The owners of several wound graft companies submitted more than $1.2 billion in fraudulent claims, targeting Medicare beneficiaries, many of them in hospice. An insurance brokerage executive and a marketing firm CEO each got twenty years for a $233 million scheme that enrolled tens of thousands of people in ACA plans without their consent, targeting people experiencing homelessness, mental illness, and addiction.

Those are the headline cases. There are smaller ones in the report too, like individual providers and small practices. But, the dollars are concentrated at the executive level, and it isn’t close.

I want to be precise about what that does and doesn’t prove, because I don’t want anyone dismissing this on a technicality. An enforcement report shows what got prosecuted. It isn’t a census of everything that happened.

But, think about what that means here. This administration has spent more than a year looking for immigrant healthcare fraud. It controls federal enforcement and has every incentive to find those cases and every reason to feature them. Despite that, its own inspector general filed six months of enforcement actions and immigrants appear nowhere in the report as perpetrators of fraud.

If the cases were there, they’d have been brought.

There’s one more thing in that report worth noting.

OIG’s oversight of Medicare Advantage produced two settlements totaling $674 million, against two of the largest MA organizations in the country. The whistleblower allegations were that the plans submitted inaccurate diagnoses to make their enrollees appear sicker than they actually were, because sicker enrollees mean bigger government payments.

Five Kaiser Permanente affiliates agreed to pay $556 million. Between 2009 and 2018, they pressured physicians through financial incentives and internal targets to go back and add unsupported diagnoses to medical records. Aetna agreed to pay $117.7 million for the same category of conduct.

Insurers got paid more when patients looked sicker, so they made patients look sicker.

What happened to the people who actually did it

In May, the President granted clemency to Lawrence Duran. Duran owned a mental health company called American Therapeutic and was serving fifty years for orchestrating a $205 million Medicare fraud scheme.

Rick Scott was CEO of Columbia/HCA, the hospital chain at the center of what the Justice Department itself called the largest health care fraud case in U.S. history. The final figure was $1.7 billion, across settlements in 2000 and 2003, resolving allegations that included cost report fraud, kickbacks to physicians, and systematically overbilling Medicare and Medicaid.

The criminal charges weren’t entered in Columbia/HCA’s name. They were entered by two defunct subsidiaries, because a conviction under the parent company’s name would have triggered automatic exclusion from Medicare funding.

The company kept billing Medicare and no senior executive at Columbia/HCA was ever charged with a crime. Scott resigned in 1997 as the investigation closed in, and in a related civil deposition he invoked the Fifth Amendment repeatedly.

Then, he ran for governor of Florida and won. Then, he ran for Senate and won.

Then, last summer, he decided healthcare cuts weren’t deep enough. He filed an amendment to add another $313 billion on top of what the bill already did, dropping the federal match from 90 percent to 50 percent for new expansion enrollees after 2030. Nine states have laws on the books that would automatically end their Medicaid expansion entirely if the match fell that far.

The Senate declined to take it up. He voted for the bill anyway.

I have to prove I’m still disabled. He didn’t have to prove anything.

An analysis from the California governor’s office found that Trump’s pardons have wiped out close to $2 billion in victim repayment and taxpayer recovery across Medicare, tax, and other fraud. Meanwhile, the internal enforcement mechanisms have been cut and inspectors general have been fired.

The enforcement apparatus that catches actual fraud is being dismantled, the people convicted of actual fraud are being released, and the verification apparatus is being built to point at people like me.

By OIG’s own accounting, every dollar it receives in funding returns $12.70 to the federal government, and its Medicare and Medicaid work returns $15.20 per dollar.

Fraud enforcement is one of the few government functions that pays for itself several times over. It’s being cut anyway.

The part that makes me tired

I have to continually prove I’m still disabled.

Every disabled person on public benefits knows this ritual. My body hasn’t changed its mind and never will. My condition is progressive, which means it moves in exactly one direction, and every doctor who has ever examined me agrees with my DNA on this point. And still, at intervals, the system requires that I demonstrate it again and again.

You should hear the silence when the Medicaid customer service rep finds out my birthday and beginning of my disability are on the same day.

Starting in January, for people in the expansion population, it won’t be enough to be disabled. You’ll have to document that your disability significantly impairs your ability to work eighty hours a month, and if your paperwork doesn’t arrive, or arrives wrong or late, you lose your coverage.

Beginning in 2028, you may attest to medical frailty once per enrollment period. As though a body might get bored of being the same body.

Lawrence Duran stole $205 million and went home. Rick Scott ran the company at the center of the largest healthcare fraud case in American history and went to the Senate.

The mechanism

Fraud is the justification and verification is the mechanism. Disabled people are who it hits hardest.

Notice which direction the paperwork runs.

When an insurer stands to gain by making me look sicker, the documentation appears. Diagnoses get added to charts years after the fact. When I stand to lose coverage unless I prove I’m sick enough, the documentation becomes my problem, and if it doesn’t arrive on time, I’m the one who pays the price.

Same medical record and disability, but the responsibility falls wherever the money isn’t.

You don’t have to prove a single case of beneficiary fraud to get the policy. You just have to say the word enough times next to photos of people from Somalia that verification sounds reasonable. Then, you build a system where the burden of proof sits with the person who’s sick, and you let attrition do the rest.

Nobody gets declared ineligible and no politician has to defend a sentence like “disabled people shouldn’t have healthcare.” The coverage just quietly stops, one incomplete form at a time, and the resulting number gets described as people who didn’t comply.

What I want you to do with this

If you work in Medicaid administration, state government, disability services, or health policy, keep a close eye on what your state does with the medically frail definition. That single decision determines who in your state stays covered in January.

If you don’t, then just know the actual shape of it. When the coverage numbers drop next year, they will be described as fraud prevention working. In reality, it’s the paperwork working.

I’ll be over here proving I’m still disabled.

Solidarity forever.

-Steve