An exemption only protects people if the system can recognize who qualifies.
Federal law now requires certain adults to document at least 80 hours each month of work, education, job training or community service to enroll in or keep Medicaid coverage. People who qualify for an exemption do not have to complete or report those monthly activities.
The Centers for Medicare & Medicaid Services (CMS) issued an interim final rule explaining how states must implement this new community engagement requirement. The requirement is the policy created by Congress. The CMS rule provides the framework states will use to determine who is affected, identify and verify exemptions and decide whether someone can enroll in or keep Medicaid coverage.
CMS issued the rule with a public comment period, which means the agency can consider feedback and revise the framework before issuing a final rule.
The Global Health Advocacy Incubator’s (GHAI) Overdose Prevention Initiative submitted comments urging CMS to strengthen protections for people with substance use disorders.
The CMS rule includes exemptions for people with substance use disorders, people participating in treatment and people recently released from jail or prison. But those protections may fail if a state does not identify that someone qualifies, cannot verify the exemption through available records or requires documentation the person cannot obtain.
For someone who relies on Medicaid for medication, counseling, mental health care or peer recovery support, a missing record or unanswered notice is not a minor administrative problem. It can interrupt treatment during a period of instability and increase the risk of relapse or overdose.
GHAI is asking CMS to revise the interim final rule in response to public comments before issuing a final rule. The goal is to ensure that the exemptions protect eligible people in practice, not only on paper.
Make substance use disorder exemptions clear and accessible
The CMS rule exempts some people with substance use disorders, but it requires them to show that their condition “significantly impairs” their ability to meet the community engagement requirement. The rule does not clearly define what that means.
Without a clear standard, states could apply the exemption differently or require evidence that people cannot easily provide. Medicaid billing records may not show a person’s substance use disorder if they recently lacked coverage, received care outside a traditional treatment program or returned to use after a period of recovery.
The verification process could fail during the exact period when someone most needs care. A person experiencing a return to use may have difficulty collecting records, responding to notices or finding a provider who can complete the required documentation.
GHAI recommends that CMS provide clear, clinically grounded guidance and recognize that the effects of a substance use disorder can change over time. CMS should also allow peer specialists, certified recovery coaches and substance use disorder prescribers in primary care to help verify eligibility.
When other records are unavailable, people should continue to have a way to confirm their own eligibility or use another verification process that does not rely only on Medicaid billing records.
Recognize the full range of treatment and recovery support
The CMS rule also exempts people who actively participate in substance use disorder treatment, but it gives states broad discretion to decide what counts.
A narrow state definition could exclude someone who receives medication for opioid use disorder through primary care, works with a peer recovery coach, uses harm reduction services or lives in recovery housing.
That could create a system where a person qualifies for protection in one state but risks losing coverage in another while receiving the same type of care.
GHAI is urging CMS to establish a federal minimum standard that recognizes the different ways people receive care and support, including medications for opioid use disorder, primary care, harm reduction services, peer support and recovery housing.
Protect people returning from incarceration
The CMS rule temporarily exempts some people from the reporting requirement after release from jail or prison. This protection is intended to prevent an immediate coverage loss during the transition back to the community.
But the exemption only works if state Medicaid agencies can quickly confirm that someone was recently incarcerated.
Many states do not yet have automated systems that can verify incarceration status quickly. Without more time and clearer federal guidance, states may place the burden on individuals during the first weeks after release, when housing, communication and access to care may remain unstable.
People leaving incarceration face an especially high risk of overdose. Coverage should not depend on whether someone can locate and submit paperwork during that transition.
GHAI recommends that CMS extend the implementation timeline, explain what state data systems must be able to do and maintain coverage while the state verifies eligibility and gives the person a meaningful opportunity to respond before ending coverage.
Measure whether the policy causes harm
CMS cannot correct problems it does not measure.
States should publicly report whether people with substance use disorders are being denied exemptions, losing coverage or experiencing treatment interruptions after the rule takes effect.
GHAI is also asking CMS to track re-enrollment patterns and downstream health outcomes, including treatment gaps and overdose events. Without that information, policymakers will not know whether states are applying the exemptions consistently or whether eligible people are falling out of care.
The risk is straightforward. A person qualifies for an exemption. The state fails to identify or verify it. The person loses coverage. Treatment stops. The chance of relapse or overdose rises.
Medicaid policy should support treatment and recovery, not create new ways for eligible people to fall out of care.
Read GHAI’s full comments and recommendations to protect Medicaid coverage, treatment continuity and overdose prevention services.
Congress will spend much of August closer to home while fiscal year 2027 funding remains unsettled. Lawmakers still have major choices to make about the programs, research, workforce and public health systems communities rely on. During the House and Senate work periods, many members return to the states and districts they represent. For public health advocates, August is not a pause in the policy process. It is a chance to bring a clear request to the people who will pass a vote.
The Centers for Medicare & Medicaid Services (CMS) issued an interim final rule explaining how states must implement this new community engagement requirement. The requirement is the policy created by Congress. The CMS rule provides the framework states will use to determine who is affected, identify and verify exemptions and decide whether someone can enroll in or keep Medicaid coverage. The Global Health Advocacy Incubator’s (GHAI) Overdose Prevention Initiative submitted comments urging CMS to strengthen protections for people with substance use disorders.
Lower numbers do not mean the job is done. The 2025 National Survey on Drug Use and Health (NSDUH) shows that opioid use disorder declined, but only one in six people who needed substance use treatment received it. That is not simply a troubling statistic. It is a warning that millions of people remain unable to reach proven, effective care.
