Why It Matters
Montana is set to strip Medicaid coverage from thousands of beneficiaries who cannot document employment, volunteering, or school attendance—including homeless individuals excluded from federal exemptions. The policy exposes a gap between federal work-requirement rules and the practical reality of people without stable housing, threatening health insurance coverage for a population already vulnerable to disease and premature death.
What Happened
The federal government has finalized Medicaid work-requirement regulations that demand beneficiaries prove ongoing employment, volunteering, or enrollment in school to maintain coverage. Montana, along with Arkansas and Nebraska, has moved to implement the rules ahead of a January 2027 deadline most states will follow. The state plans to begin removing non-compliant enrollees from Medicaid in October.
The Trump administration exempted people with disabilities, those over 64, pregnant individuals, and Native Americans from the work mandate. Notably, it did not exempt homeless people. Montana, Arizona, Kentucky, and Utah previously sought to add homelessness as an exemption category; federal officials rejected all such requests.
Individuals who do not fall into automatically exempt categories have 30 days to demonstrate their work or education status. Montana’s health department says an automated medical records system to process exemptions should be operational by October.
The Centers for Medicare & Medicaid Services declined to comment on the record but confirmed states must restrict exemptions to the federal list only.
By the Numbers
27% — increase in U.S. homelessness between 2013 and 2025
746,000 — people homeless last year
55% — portion of patients at Health Care for the Homeless programs enrolled in Medicaid in 2023
300 — roughly the number of Health Care for the Homeless programs nationwide
5 million — projected increase in uninsured people by 2034 due to work requirements, according to the Congressional Budget Office
30 — days non-exempt individuals have to prove work or school status
Zoom Out
The policy collision reflects a broader tension in the federal work-requirement rollout. Homelessness in the United States has climbed 27 percent over the past dozen years, making housing instability a growing public health challenge even as new coverage rules tighten eligibility. Twenty-five mostly Democratic-led states sued the Trump administration in June over the work-requirement regulations, challenging their legality and impact.
The Congressional Budget Office has projected that work requirements nationwide will increase the uninsured population by more than 5 million people by 2034. CMS leader Mehmet Oz has framed the mandate as necessary: “We need to get people to try to work.” The surprise and concern among health policy observers was immediate. Jennifer Tolbert, deputy director of the Kaiser Family Foundation, told reporters, “It took everyone by surprise.”, as first reported by the Montana Free Press
Montana passed its first Medicaid work-requirement bill in 2019, earlier than most states, setting the stage for rapid implementation once federal rules solidified.
A Case Study in the Coverage Gap
Tywon Pugh, 46, exemplifies the predicament. He became homeless in Missoula after his wife’s death in 2025, following 10 years of marriage. Pugh has seizures—a condition that may qualify for disability exemption but requires proof of diagnosis and documentation. Without stable housing, obtaining and submitting medical records within 30 days becomes significantly harder.
What’s Next
Montana will begin processing exemption claims and removing non-compliant enrollees this October. Most other states will follow suit beginning in January 2027. The practical outcome—whether Montana’s automated system can effectively reach and document homeless beneficiaries, and whether homeless people can navigate the 30-day proof window without stable addresses or access to medical records—will test whether work requirements can function as intended without a formal homelessness exemption.