Too sick to work? States must get their new Medicaid rules right.

Starting Jan. 1, 2027, Illinois will ask adults in its Medicaid expansion program to either prove they worked 80 hours in the last month or that they are too sick to work. The state will answer that second question mostly with billing codes.

For a woman between an abnormal mammogram and a confirmed diagnosis, the billing codes say she is fine. Her doctors do not.

Congress set the requirement. States decide how to run it. The hardest decision is how you tell from a claims file who is too sick to work. On July 30, a federal judge declined to pause the rule while a multistate challenge proceeds. States are building their systems now — Illinois shows what is at stake in getting it wrong. 

The law exempts people who are “medically frail,” a category meant to protect those with conditions that keep them from working. Cancer treatment can qualify, for example. The problem is how states find those patients.

Illinois, like most states, will lean on claims data, the billing codes generated when patients receive care. Those codes work well for a patient mid-chemotherapy, but they fail at both ends — both before a diagnosis is confirmed and after treatment ends while monitoring continues.

An abnormal mammogram creates a patient before it creates a diagnosis. Between the image and the pathology report, she moves through more imaging, a biopsy and specialists. The cancer code belongs to the end of that process. Until pathology confirms........

© The Hill