Nebraska Starts Kicking People Off Medicaid Today, the First State in America to Do It

LINCOLN, Neb. — On Saturday, roughly 200 Nebraskans will wake up without health insurance, and they will be the first Americans in the country to lose Medicaid under the work rules President Trump signed into law last year.

Drew Gonshorowski, Nebraska's director of Medicaid and Long-Term Care, confirmed the number this week. The terminations take effect Aug. 1 and apply to people who did not document that they worked, volunteered, performed community service, or attended school or an apprenticeship for at least 80 hours a month. Enrollees can also satisfy the rule by earning at least $580 a month. The requirement covers so-called able-bodied adults ages 19 to 64 who gained coverage through the Affordable Care Act's Medicaid expansion.

Nebraska did not have to move this fast. The 2025 budget package known as the One Big Beautiful Bill Act gives states until Jan. 1, 2027, to stand up work requirements. Nebraska launched eight months early, becoming the test case for a policy that will eventually reach roughly 20 million people across 44 states and is projected to save the federal government about $325 billion over a decade.

"I view this as the ultimate bellwether on whether or not you got your process right on implementation," Gonshorowski said. He said the state built extra checks into the system before anyone is dropped: "We've ensured that we have extra steps in place making sure we review any denial multiple times before it goes out the door." Nebraska is running the program through the eligibility system it already owns rather than hiring an outside vendor, and it has not added staff. The state says it sent more than 75,000 letters, 38,000 text messages and 10,000 emails, and held 15 to 20 meetings with community groups, before flipping the switch.

Gov. Jim Pillen has defended the policy in blunt terms. "This is a hand up, not a handout," he said. "It's a key piece of giving the discipline for our families to be successful." State officials estimate that 40 percent of expansion enrollees already earn more than $580 a month and that between 60 and 72 percent already meet the engagement standard on paper.

Health advocates say the danger is not that people refuse to work — it is that they fail to file the right form on time. About 72,000 Nebraskans are subject to the policy, out of roughly 112,600 expansion enrollees and about 338,000 people on Medicaid statewide. The Urban Institute estimates roughly 25,000 residents could ultimately lose coverage; the Center on Budget and Policy Priorities puts the range at 28,000 to 41,000. NPR reported an estimate of about 30,000 Nebraskans by 2028. Nationally, projections of coverage losses run from 3 million to as high as 8.6 million over the same period.

"This is a really complicated system that's been set up to have people lose coverage," said Sara Maresh, health care access director at Nebraska Appleseed. Jed Hansen, president of the Nebraska Rural Health Association, has warned that the paperwork burden — not unemployment — will drive most of the losses, and that rural hospitals will absorb the cost when uninsured patients show up in emergency rooms anyway. Amy Behnke, who leads the Health Center Association of Nebraska, has raised similar concerns about awareness and staffing.

People who are aged, disabled, pregnant, medically frail, caring for young children or experiencing a temporary hardship such as hospitalization are exempt. Nebraska's Medicaid budget was cut by about $19 million for 2026 and roughly $103 million for 2027 in anticipation of smaller rolls. Enrollees who are flagged get a 30-day window to respond with additional information before coverage ends.

Every other state will be watching what happens over the next several weeks. If 200 people is where Nebraska's first month lands, supporters will call the rollout a success. If the number climbs sharply as later renewal cohorts hit their deadlines through June 2027, the state will become the cautionary tale that opponents of work requirements have been predicting since the law passed.