New Mexico Medicaid Director Dana Flannery told the state Medicaid Advisory Committee on Monday the New Mexico Health Care Authority will need more staff to comply with the federal One Big Beautiful Bill Act, which Congress passed and President Donald Trump signed into law last month.
By Dec. 31, 2026, states must renew Medicaid recipients’ paperwork at least every six months. New Mexico currently confirms eligibility annually.
“When you enhance the frequency of those, the likelihood of more people falling off the rolls of Medicaid is much stronger,” Flannery said.
The new law also adds work requirements to the renewal process, meaning Medicaid recipients will have to prove they’ve completed 80 hours of work or community service per month, or meet exemption criteria to enroll in and maintain coverage. Flannery said the federal Centers for Medicare and Medicaid Services has not yet offered guidance about what kind of proof people will need to qualify for an exemption.
While several parts of the new federal law will lead to people losing their health insurance, work requirements alone will result in approximately 88,000 people in New Mexico getting kicked off the rolls, Flannery said.
“This doesn’t mean, necessarily, that people aren’t doing the work requirements or aren’t already working,” she said. “A lot of people fall off of Medicaid due to not doing the paperwork required to stay.”
It will cost $32.7 million initially for New Mexico to change its system for administering these benefits, and $6.5 million each year thereafter, according to a preliminary cost estimate provided by Health Care Authority Director of Communications Marina Piña to Source NM.
Flannery told the committee she’s still working on an exact number of full-time workers she will need to increase the pace of processing Medicaid paperwork. Her agency is deciding whether to ask the federal government for an extension to delay the work requirements, she said.
Gary Housepian, executive director of Disability Rights New Mexico, told the committee his organization thinks many more people could lose their health insurance as a result of the new law, including those who don’t qualify for Social Security but are still disabled and won’t be able to meet the work requirements to receive Medicaid and SNAP.
Gov. Michelle Lujan Grisham told Face the Nation on Sunday that there is “no real way to implement” the health care changes in the new law.
“It’s more paperwork for the federal government, for state governments, for county governments, for local hospitals, for independent providers,” Lujan Grisham said. “It’s more paperwork for everyone.”
