How to Prepare Your Hospital Before H.R. 1 Hits in 2027

I’ve been in healthcare long enough to know that silence doesn’t mean agreement. The last few weeks have reinforced that belief.

Across the country, hospital teams have been briefed on what the upcoming changes to H.R. 1 mean. Often at the end of the sessions all that can be heard is crickets. Hospitals are overwhelmed by the information coming their way. They are still waiting for guidance from the state and CMS, and, frankly, waiting to see how enforcement will play out before they commit real resources.

While I understand the instinct, October 2026 is just around the corner, and those who prepare now will be in a much stronger position to navigate the changes.

The scale that changes everything

H.R. 1 is expected to cut federal Medicaid and CHIP spending by approximately $990 billion over ten years – the largest reduction in the program’s history. Combine this with expiring ACA marketplace subsidies, more than 14 million Americans could be uninsured by 2034. The work requirement alone is projected to account for about 5.3 million of those losses.

Understanding these losses requires looking beneath the surface. For instance, in Arkansas and New Hampshire, which both ran work requirement programs before the federal expansion, disenrollment was primarily driven by reporting failures. People who qualified for coverage simply lost out because they couldn’t navigate the reporting process in time.

We saw similar documentation failures play out nationally during the 2023–24 redetermination period, when states reverified Medicaid eligibility after the Covid continuous enrollment ended. This particularly hits rural hospitals hard, considering nearly half of them had negative operating margins even before H.R. 1 passed. To make matters more difficult, the Rural Health Transformation Fund covers just over a third of projected rural revenue losses, according to KFF.

Deadlines and what they mean

States are already working on completing Medicaid member outreach, with required notices going out across late summer and early fall under the interim final rule CMS issued in June 2026. Implementation work has already begun in states like Nebraska, with Montana and Arkansas close behind. Every state is required to have work requirement infrastructure in place by December 31, 2026.

Redetermination cycles will go from 12 months to six months for renewals scheduled on or after December 31, 2026, which means double the effort when it comes to documentation, outreach, and eligibility verification, especially for workflows that most teams haven’t revisited since 2024.

A deadline many are not tracking is October 1, 2026. It’s the day federal Medicaid funding ends for refugees, asylees, and humanitarian parolees. For hospitals that serve these populations, eligibility staff should be prepared to address patient questions when coverage changes take effect.

How this plays at your front desk

A patient arrives at your front desk, and she has been on Medicaid for years. She received a letter about work requirements a few weeks earlier. She works part-time and thought it didn’t apply to her. Her renewal period is now six months, but nobody called her.

The eligibility system shows she is covered when she checks in. But halfway through the visit, the system refreshes. The claim comes back denied because she is no longer covered, and the revenue cycle team spends countless hours on partial recovery. It’s a scenario I’ve seen before, and unfortunately, we will see it play out again if hospitals are not prepared for what’s to come.

The math is stark: uncompensated care runs roughly $40 billion nationally. Even at a conservative $1,000 per uninsured patient, coverage losses translate into billions of dollars in financial risk for hospitals. The retroactive billing period is now down from 90 days to 30 for expansion adults and 60 for everyone else, which makes the situation worse, because traditionally hospitals depended on this buffer period for years.

When coverage breaks down, it results in the following issues:

• Patients do not know that the renewal cycle has changed from annually to every six months. By the time they realize the change, their coverage may have already lapsed.
• Work requirement documentation is going to catch people off guard, especially those working informally or inconsistent hours, considering that the federal standard requires 80 hours of qualifying activity per month. 
• With the retroactive billing buffer cut by two-thirds, hospitals may need years to clean up missed eligibility on the back end. For revenue cycle teams, this means changing the workflow before the change takes effect.

What are prepared systems doing?

• Start with proactive outreach: As a provider, you need to reach patients before state notices do, and for most states those go out in September. Then work with financial counselors to understand what the requirements actually demand, identify which categories are exempt, and determine how you can walk patients through the process during their visits.
• Run eligibility checks before the appointment: You will need to check whether a patient still has Medicaid days or weeks before their scheduled appointment, instead of doing it as they walk in the door. This will allow you to call them, help them re-enroll, or find an alternative if their policy has lapsed.
• Get finance and billing into the room now: Your billing team now has 30 days instead of 90 to recover revenue from expansion adults who turn out to be Medicaid-eligible after their visit, and 60 days for everyone else. Missing that window effectively means the money is gone. In expansion states, as federal spending starts to drop annually from 2028, finance teams will have to start preparing now. When coverage lapses at scale, denied claims will pile up as well. That essentially means you will have to track denials by insurer and patient type before they become a cash flow problem.
• Track what is happening to your patient population: Eligibility and outreach data supports DSH status, 340B participation, and relationships with state agencies and community funders. Hospitals that kept accurate records during redetermination were better positioned for every difficult conversation that followed.

Start preparing for H.R. 1 now

We’ve watched this play out once before, and the scale is much bigger this time around. The systems that moved early managed it well. The ones that waited then spent months in reactive mode, and their patients lost coverage because the paperwork never happened in time.

It’s important to understand that H.R. 1 is much bigger, the timelines are more stringent, and the October eligibility deadline arrives before the main wave. 

For many providers, the volume of new information is overwhelming, and so is the responsibility to do right by patients and staff. The best path forward is operational readiness before the October deadline arrives. 

Photo: izusek, Getty Images

This post appears through the MedCity Influencers program. Anyone can publish their perspective on business and innovation in healthcare on MedCity News through MedCity Influencers. Click here to find out how.