Medicaid Expansion in Kansas: Impacts of Federal Policy Options Under Consideration and Updated Estimates

Introduction

Federal budget proposals discussed in 2025 proposed altering funding for Medicaid expansion. If enacted, these changes would likely shift more costs to the states. Proposed cuts include eliminating the enhanced federal match rate (90 percent) for newly eligible adults and eliminating the 2021 American Rescue Plan Act (ARPA) incentive for states, which provides additional federal funding to states that newly expand Medicaid. Proposed changes also include instituting work requirements for Medicaid. While some proposals have suggested significant cuts or restructuring that would affect the current KanCare program as well as expansion estimates, no changes to the Medicaid program have been enacted as of the publication date of this brief. Under current law, an estimated 120,157 Kansans would be expected to newly enroll in KanCare if expanded, at an estimated 10-year net cost to the state of $75 million after accounting for federal match rates, incentives, new state revenues, administrative costs and offsetting savings.

Since 2012, when the U.S. Supreme Court made Medicaid expansion optional for states, the Kansas Legislature has debated whether to expand coverage to adults age 19–64 with incomes at or below 138 percent of the federal poverty level (FPL; $21,597 for an individual or $44,367 for a family of four in 2025). In 2025, Governor Laura Kelly again proposed expanding Medicaid in the Healthcare Access for Working Kansans (HAWK) Act, which included a work requirement for expansion enrollees with some exceptions. However, even with current incentives in place, Kansas lawmakers have not adopted Medicaid expansion. Currently, Kansas offers Medicaid to certain groups, such as low-income parents, pregnant women, people with disabilities, children and seniors. Most other states — 40 plus Washington, D.C. — have expanded Medicaid. Some did so under standard Affordable Care Act (ACA) rules, while others used federal waivers to tailor their programs.

This brief estimates how expanding Medicaid in Kansas under current law would affect KanCare enrollment and spending, based on the latest data. It also discusses how federal policy options under consideration could impact the estimates.

Impacts of Proposed Changes for Medicaid Expansion

The Kansas Health Institute (KHI) analyzed how specific federal proposals, if enacted, would impact costs if Medicaid is expanded in Kansas. See Figure 1 for how the changes discussed would impact the state’s share of projected costs for Medicaid expansion.

For more analysis of proposed federal changes to Medicaid and impacts to Kansas, see Hill to the Heartland, a product series from KHI providing regular updates on federal health policy discussions.

Figure 1. Kansas State Costs of Expansion Under Select Federal Policy Scenarios, 2026 to 2035

Source: Kansas Health Institute analysis of IPUMS USA 2023 American Community Survey data; U.S. House of Representatives Reconciliation Options, January 2024, Fiscal Year 2024; and 2025 Medical Assistance Reports from the Kansas Department of Health and Environment and the Kansas Department of Corrections.

Eliminate Enhanced Federal Medical Assistance Percentage (FMAP) for Medicaid Expansion

Under current law, the federal government covers 90 percent of the cost for the expansion population on a permanent basis, with states being responsible for covering the remaining 10 percent of costs. Proposals to reduce the enhanced FMAP (i.e., match rate) for Medicaid expansion, if adopted, would likely reduce the federal government’s share for the expansion population to each state’s regular match rate.

States would need to adjust their budgets to take on a much larger share of expansion costs. Some may roll back expansion due to provisions that require them to do so if the 90 percent federal match rate goes away. Nine states have trigger laws in place to automatically end their expansion if the 90 percent federal match were to be eliminated. These states are Arizona, Arkansas, Illinois, Indiana, Montana, New Hampshire, North Carolina, Utah and Virginia. The HAWK Act also includes such a provision.

Eliminate the Additional Incentive for States to Implement Medicaid Expansion

Under current law, if remaining non-expansion states were to adopt Medicaid expansion, they would receive an additional 5 percentage point increase in their regular FMAP (for non-expansion enrollees) for two years, no matter when they newly expand. Currently, the ARPA incentive remains available to states that have not yet expanded Medicaid. Kansas would receive an estimated $542 million over two years if it expanded Medicaid in 2026, which is the equivalent of approximately nine years of net state expansion costs. However, if Congress eliminates this provision from ARPA, non-expansion states would lose this financial incentive, which has been a major driver in other states, such as North Carolina’s decision to expand Medicaid. Without the funding incentive, states like Kansas may see slower, or stalled, expansion decisions.

Costs of Medicaid Expansion Under Current Law

The detailed estimate that follows assumes expansion as currently funded in federal law would be implemented on Jan. 1, 2026. Over 10 years, estimated total costs including federal and state spending would increase. However, offsetting cost savings and new revenues associated with expansion would significantly reduce costs to the state if current federal incentives remain in place. The estimated net cost to the state of $75 million over 10 years includes new revenues and savings from adults who would enroll in the new expansion group (with a federal match rate of 90 percent) rather than another eligibility group with a less-favorable match rate (regular match rate of around 60 percent) and additional administrative costs from new enrollment. State savings also are estimated to account for inmates who could be eligible for Medicaid in the case of a hospital admission longer than one day. The estimated state net costs do not include the projected effects on the workforce or the overall state economy. The estimate also includes a two-year, 5-percentage point bump in the federal match rate for traditional Medicaid populations enacted in the American Rescue Plan Act (ARPA) in 2021 as an incentive to states to newly expand their programs. For Kansas, the incentive would be worth an estimated $542 million over two full years, the equivalent of approximately nine years of net state expansion costs. The resulting estimated costs are presented in Figure 2.

Figure 2. Estimated Direct and Indirect Costs Related to Medicaid Expansion, 2026–2035 (in Millions)

Note: This analysis presents results by calendar year, assuming a Jan. 1, 2026, implementation. Numbers may not sum due to rounding. The total American Rescue Plan Act (ARPA) incentive only includes savings associated with the population currently eligible and enrolled. Costs for new enrollees who are currently eligible were accounted for separately in the two years that the ARPA incentive is applied. Detailed assumptions are available in a technical supplement. “()” indicates net savings. New adults indicate adults newly eligible for Medicaid if expanded who would enroll. Current adults and current children indicate adults and children who are currently eligible for Medicaid but would newly enroll if Medicaid is expanded.

Source: Kansas Health Institute analysis of IPUMS USA 2023 American Community Survey data, Fiscal Year 2024 and 2025 Medical Assistance Reports from the Kansas Department of Health and Environment and the Kansas Department of Corrections.

Enrollment Estimates

As in previous estimates from KHI, the estimate in this brief represents all those who are expected to newly enroll if Medicaid is expanded. This assessment differs from other estimates of Medicaid expansion enrollment, including state fiscal notes, because it includes potential indirect effects of expansion, such as currently eligible children and adults who might newly enroll in an expanded Medicaid program. The estimate of 120,157 additional enrollees includes 83,207 adults and 36,950 children. Of the 83,207 estimated new adult enrollees (Figure 3), 48,142 would be adults who are currently uninsured, of which all but 1,674 would be newly eligible, and 35,065 adults who might switch to KanCare from another insurance source.

Figure 3. Projected Kansas Adults Age 19–64 in Medicaid Expansion Population With Income Under 138 percent of the Federal Poverty Level (FPL)

Note: The estimate for newly eligible adults enrolling in Medicaid includes 1,782 uninsured adults assumed to have lost coverage during unwinding. Take-up rate is the estimated probability of enrolling in Medicaid if expanded among Kansans potentially eligible for Medicaid if expanded. Source: Kansas Health Institute analysis of IPUMS USA 2023 American Community Survey data and Kansas Department of Health and Environment 2023 Administrative Data. Estimates of poverty level use the State Health Access Data Assistance Centers (SHADAC’s) Health Insurance Unit (HIU) definition of family.

Source: Kansas Health Institute analysis of IPUMS USA 2023 American Community Survey data and Kansas Department of Health and Environment 2023 Administrative Data. Estimates of poverty level use the State Health Access Data Assistance Centers (SHADAC’s) Health Insurance Unit (HIU) definition of family.

This brief also considers that some adults already enrolled in KanCare could shift to the expansion group, which is estimated to reduce state costs. Approximately 7,000 current KanCare members who might otherwise have enrolled in pre-expansion eligibility categories could instead become eligible in the new expansion group. That effect would increase the adult enrollment in the expansion group but not the total enrollment, so the group is not included among the estimated 83,207 “new” adult enrollees. Expanding Medicaid would not change the eligibility levels for children, but it is assumed that more currently eligible children who are not enrolled would enroll in KanCare, as outreach efforts following expansion reached more people, particularly if their parents were to newly enroll. The estimate of 36,950 newly enrolled children (Figure 4) includes 14,617 currently uninsured children and 22,333 children who might switch to KanCare from other coverage.

Figure 4. Projected Kansas Children Affected by Potential Medicaid Expansion for Adults

Note: The estimate of total new children in Medicaid or the Children’s Health Insurance Program (CHIP) includes 1,020 children assumed to have lost coverage during unwinding. Take-up rate is the estimated probability of enrolling in Medicaid if expanded among Kansans potentially eligible for Medicaid if expanded. Source: Kansas Health Institute analysis of IPUMS USA 2023 American Community Survey data and Kansas Department of Health and Environment 2023 Administrative Data. Estimates of poverty level use the State Health Access Data Assistance Centers (SHADAC’s) Health Insurance Unit (HIU) definition of family.

Source: Kansas Health Institute analysis of IPUMS USA 2023 American Community Survey data and Kansas Department of Health and Environment 2023 Administrative Data. Estimates of poverty level use the State Health Access Data Assistance Centers (SHADAC’s) Health Insurance Unit (HIU) definition of family.

Impacts to Expected Medicaid Enrollment in Kansas

The latest enrollment estimates for Medicaid expansion in Kansas are lower, in part, due to a smaller pool of individuals being eligible under expansion and key shifts in insurance coverage, including:

• Marketplace Enrollment Growth: In part because of large gains in health insurance marketplace enrollment, there have been fewer uninsured Kansans in recent years. If Medicaid is expanded, marketplace enrollees with income below 138 percent FPL would likely enroll in Medicaid. However, enhanced federal subsidies enacted during the pandemic are set to expire at the end of 2025, which is expected to reduce marketplace enrollment in 2026 and beyond.
• Medicaid Unwinding: Fewer people lost coverage during Medicaid unwinding (the process of redetermining eligibility following the end of the COVID-19 public health emergency’s continuous coverage requirement) than expected — as many likely shifted to marketplace plans or another source of coverage.

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Medicaid Expansion and Work Requirements

Proposals to include work requirements for Medicaid are under consideration at the state and federal level. In 2025, Governor Laura Kelly again proposed expanding Medicaid in the Healthcare Access for Working Kansans (HAWK) Act, which included a work requirement for expansion enrollees with some exceptions. Under the proposal, KanCare would have been expanded to cover adults age 19–64 with income up to 138 percent of the federal poverty level (FPL), approximately $44,367 per year for a family of four in 2025. Medicaid expansion has been a recurring issue in Kansas since the U.S. Supreme Court made it optional for states in 2012. While 40 states and Washington, D.C., have expanded Medicaid, Kansas remains among the 10 states that have not. It is important to understand how work requirements would impact the expansion population as discussions continue around instituting work requirements for Medicaid at the federal level.

Experiences in Arkansas and Georgia have shown how a Medicaid work requirement under expansion could impact enrollment. See details below.

Figure 1. Potential Impacts: Experiences From Other States

Georgia

• Georgia is a non-expansion state that implemented a Medicaid work requirement through its Pathways to Coverage program, which officially launched in July 2023.
• Unlike full Medicaid expansion, this program offers limited coverage to adults age 19–64 with income up to 100 percent FPL, who complete 80 hours of work or activities (e.g., job training, education) per month.

Impacts: Work requirements may place additional administrative burdens and costs on state Medicaid programs.

• Georgia initially required monthly verification of work or qualifying activities, but it proved to be complex and resource intensive, leading to higher administrative costs and less potential savings from decreased enrollment.
• In early 2025, Georgia shifted from monthly to annual verification to reduce the administrative burden for both enrollees and the state.
• Because of the work requirement and limited eligibility criteria, Georgia’s Medicaid program saw less enrollment than initially projected. As of April 2025, 7,447 individuals were enrolled in the Pathways to Coverage program, representing approximately 29.7 percent of the state’s initial first-year projection of 25,028 enrollees. It is estimated that 240,485 uninsured low-income Georgians may be eligible for the program.

Arkansas

• The first state to implement a Medicaid work requirement, applying it to the Medicaid expansion population from June 2018 to March 2019.
• Required enrollees to report 80 hours of work per month or other qualifying activities, such as job training, education or volunteering.

Impacts: Enrollees of Medicaid may be at risk of disenrollment despite meeting work requirements due to reporting barriers and administrative complexities.

• More than 18,000 individuals, or approximately a quarter of expansion enrollees subject to the requirement, lost coverage within the first nine months, primarily due to noncompliance in reporting, not necessarily because they were unemployed.
• The policy faced significant legal challenges, and in March 2019, a federal judge blocked the work requirement, citing concerns about coverage losses and the program’s failure to fulfill Medicaid’s purpose of providing health care.
• Research found no evidence that employment rates and number of hours worked increased.

Medicaid Expansion and Potential Impacts of Work Requirements Under Consideration

Federal and state proposals to implement work requirements for Medicaid enrollees are currently under consideration, but no proposal has passed. The details of these proposals vary, which would result in different impacts on Medicaid enrollment and coverage.

Kansas Medicaid Expansion proposed in the HAWK Act includes a work requirement similar to the one proposed in 2024. It would require:

• Adults age 19–64 in the expansion population must demonstrate employment in the previous 12 months at the time of application and renewal completed at their renewal date. Includes exemptions for parents or guardians of a dependent child under 18 years of age or of an incapacitated adult, full-time students, full-time caregivers, veterans, volunteers, individuals experiencing homelessness, Kansans with medical conditions and former foster youth under age 22, among others.

At the federal level, work requirements are being considered as a part of an overall effort to reduce spending. Recent legislation was passed by the U.S. House of Representatives, but it is not yet law. It would require:

• Adult Medicaid enrollees without dependents to work, attend school or a job training program, or participate in community service for at least 80 hours per month. Exemptions include individuals with disabilities or health-related barriers to employment, individuals who are pregnant, primary caregivers of dependents or an individual with a disability, foster youth and former foster youth under age 26, individuals who are already complying with TANF or SNAP work requirements, and persons who are incarcerated or released within the past 90 days.

Potential Impacts of a Work Requirement on Medicaid Expansion in Kansas:

If a work requirement were in place, analysis of adults age 19–64 likely eligible for Medicaid if expanded (not discounting for take-up rates but excluding those already enrolled in Medicare or Medicaid) indicates:

• Approximately 7 in 10 (71.3 percent) are working and would meet the HAWK Act requirement.

Likely eligible Kansas adults age 19–64 who are not employed (28.7 percent) may meet some exceptions to the proposed work requirement in the HAWK Act. Analysis indicates that among individuals who are not employed in the expansion population:

• 33.1 percent have a child under age 18 in their household and could potentially be eligible as parents or guardians.
• 14.9 percent are individuals with disabilities.
• 25.7 percent are current students.
• 2.1 percent are veterans.

Note: Characteristics are not mutually exclusive.

Projected Impact of Work Requirements on Medicaid Expansion Enrollment in Kansas

• Analysis of available data suggests that Medicaid enrollment in Kansas would likely decline if a work requirement were implemented as proposed in the HAWK Act. Specifically, new enrollment as a result of expansion would be projected to decrease from 120,157 to 99,921, reflecting a 16.8 percent reduction from a traditional expansion scenario. This estimate accounts for likely enrollees who are unemployed but likely would qualify for exemptions, including parents of children under age 18, students attending higher education, veterans and those with a disability.

However, the analysis does not factor in all exemptions outlined in the HAWK Act for which data is less readily available, such as:

• Parents or guardians of incapacitated adults, individuals not fit for employment as determined by the Kansas Department of Health (KDHE) secretary, or those with pending applications for supplemental security income or social security disability insurance (many of whom would be included as individuals with disabilities).
• Volunteers working at least 20 hours per week at nonprofit organizations.
• Homeless individuals.
• Former foster youth under age 22.
• Individuals experiencing hardship as determined by the KDHE secretary.

Incorporating these additional exemptions would likely increase the number of eligible individuals and result in higher enrollment than current estimates suggest.