On April 8, 2026, the Centers for Medicare and Medicaid Services (CMS) issued guidance directing states to restrict Medicaid and Children’s Health Insurance Program (CHIP) eligibility for certain categories of non-citizens effective October 1, 2026. CMS guidance is available here.   

According to CMS, Section 71109 of the Working Families Tax Cut Legislation (WFTC) limits the availability of federal financial participation (FFP) for Medicaid and CHIP services provided to individuals who do not fall within specifically authorized immigration categories.

Categories Eligible for Full Medicaid and CHIP Benefits

CMS’s interpretation of WFTC, federal reimbursement will continue to be available for healthcare services provided to the following individuals: 

•  U.S. citizens or U.S. nationals
• Lawful permanent residents (green card holders) who have completed the five-year waiting period
• Certain Cuban and Haitian entrants
• Individuals lawfully residing in the United States in accordance with the Compact of Free Association
• Children  and pregnant adults lawfully residing in states that elect to provide such coverage

Continued Availability of Limited Benefit

Non-citizens who are not included in the above categories may still be eligible for healthcare benefits, including:

• Medicaid and CHIP benefits to treat emergency conditions
• Healthcare benefits for lawfully residing non-citizens funded solely by the States and Territories (also known as the CHIPRA 214 Option) for states that participate
• Services provided under a Health Services Initiative (HSI), which are certain services provided to improve the health of low-income children

Non-Citizen Categories Losing Full Benefits Beginning October 1, 2026

CMS’s guidance states that, effective October 1, 2026, the following categories of non-citizens will no longer qualify for full Medicaid or CHIP benefits funded through FFP:

• Refugees
• Asylees
• Certain parolees admitted for at least one year
• Individuals granted withholding of removal
• Conditional entrants
• Survivors of domestic violence with pending or approved applications under the Violence Against Women Act (VAWA)
• Victims of trafficking and certain qualifying family members
• Amerasian immigrants
• Certain lawfully residing veterans, active-duty servicemembers, and qualifying family members
• American Indians born in Canada and certain tribal members who are not U.S. citizens
• Certain Afghan and Ukrainian parolees

Additional Eligibility Verification for Non-Emergency Services

CMS’s guidance also imposes new eligibility verification obligations on states beginning October 1, 2026. To continue receiving FFP reimbursement for non-emergency Medicaid and CHIP services, states must verify beneficiaries’ immigration status before providing coverage. 

In addition, states must undertake prompt redeterminations of current beneficiaries’ immigration status where eligibility cannot be verified electronically. If a state determines that an individual is no longer eligible, it must provide advance notice of adverse action, including information regarding applicable appeal and due process rights, before terminating coverage or reducing benefits.

Key Takeaways

The guidance represents a significant change in Medicaid and CHIP eligibility policy and may affect state Medicaid agencies, managed care organizations, healthcare providers, hospitals, and advocacy organizations. Stakeholders should prepare for increased eligibility verification requirements, operational changes, and potential coverage disruptions affecting non-citizen populations currently receiving full benefits.

Healthcare organizations and state agencies should review current eligibility determination procedures and prepare for implementation ahead of the October 1, 2026, effective date.

If you have any questions regarding changes to Medicaid and CHIP eligibility for non-citizens, please contact Jesi Carlson, Phillip Escoriaza, or Kevin Lutes.