Indiana Says 58,000 Medicaid Members Fall Short of New Work Rules

Indiana's Medicaid agency estimates that about 58,000 people covered through the Healthy Indiana Plan are not currently showing compliance with — or an exemption from — the work requirements the state begins enforcing on January 1, 2027, a figure state officials themselves describe as a rough guess.

The Family and Social Services Administration shared the internal estimate on Monday, according to WFYI Public Media and the Indiana Capital Chronicle. The Healthy Indiana Plan, or HIP, is the state's Medicaid program for low-income adults.

What the January rules require

Most HIP members between 19 and 64 who are not pregnant and not enrolled in Medicare will need to log 80 hours a month of work, school or volunteering, or meet an earnings test of $580 a month — the federal minimum wage of $7.25 multiplied by 80 hours. Activities can be combined to reach the monthly total, and the state allows a seasonal average of $580 for workers whose income swings.

People planning to apply for coverage in January had to begin meeting the requirement this month, under a three-month lookback the state applies to new applicants. HIP coverage renews every six months, and Indiana checks work hours or exemption status every three months. A member who falls out of compliance loses coverage and must reapply; marketplace financial help is unavailable in the meantime.

A number the state calls a guesstimate

Sunshine Beam, a spokesperson for the Family and Social Services Administration, said the 58,000 figure comes from income verification and other eligibility checks that flag "individuals who are not showing as working, individuals who are just not exempt for any other reason."

"It's really sort of a guesstimate at this point," she told WFYI, noting that some flagged members may already qualify but have not had their work or exemption recorded.

Secretary Mitch Roob framed the disclosure as a nudge. "We are sharing this information to strongly encourage HIP members to take personal responsibility for their coverage," he said in a statement. The state says it has notified more than 500,000 HIP members since June.

An exemption for treatment, and a definition still missing

Indiana's exemption list includes people in substance use treatment, a category that matters in a state where addiction treatment is heavily financed by Medicaid — the country's single largest payer of behavioral health services, according to Georgetown University's Center for Children and Families.

Other exemptions cover parents and caregivers of a child 13 or younger, caregivers of a person with a disability, pregnancy and the 12 months after, veterans with a 100 percent disability rating, former foster youth under 26, members of federally recognized tribes, people released from incarceration within 90 days, and people already following SNAP or TANF work rules. People who are medically frail or have special medical needs are also exempt.

But Indiana has not published its updated definition of medical frailty. "Drafts of that information for the general public and for providers and such is all in the hopper to be released soon," Beam said. Indiana is one of at least six states — with Arkansas, Idaho, New Hampshire, North Carolina and Ohio — that will require documentation of medical frailty rather than accepting an enrollee's own account.

Advocates warn of paperwork losses

Tracey Hutchings-Goetz of the advocacy group Hoosier Action said the burden of proving compliance falls hardest on people navigating a system that is still being built.

"Given the complexity of the program and the likelihood for errors, it is really critical that every HIP member is paying close attention," she said. "We know that a lot can go wrong, and the state sometimes has inaccurate data."

Hutchings-Goetz added that the state's messaging places responsibility on members rather than on the agency. "The state is obscuring their own responsibility for this system, which is not yet set up," she said.

A national rollout moving at different speeds

Starting January 1, 2027, 40 states and the District of Columbia must impose work and community engagement requirements on adults covered by Medicaid's expansion to low-income adults. About 20 million of the 82.4 million people enrolled in Medicaid in 2025 fell into that group, according to the Associated Press.

The Congressional Budget Office estimated in October 2025 that the work requirement alone would leave about 5.3 million more people uninsured by 2034. A group of 25 Democratic-led states and the District of Columbia sued in June to block the rules, arguing they unlawfully narrow exemptions for people with serious medical conditions; a federal judge denied that request in July. Montana began enforcing its requirements on October 1, and Pennsylvania has begun mailing notices to more than 700,000 expansion enrollees.

For people in recovery, a coverage gap can interrupt medication for opioid use disorder and counseling mid-treatment. People looking for care that accepts Medicaid can compare opioid rehab programs and ask each provider which plans and exemptions apply to them.