Updated on July 21, 2025

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On Thursday, July 10, 2025, the U.S. Department of Health and Human Services (HHS) announced a significant policy change by issuing a notice (0991-ZA57) setting forth its revised interpretation of the term “Federal public benefit” as used in Title IV of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), 8 U.S.C. § 1611. HHS rescinded its 1998 interpretation of the term (63 FR 41658) and expanded the agency’s interpretation of “Federal public benefit” to include programs, including Head Start and numerous community health-related programs. The notice specifically states that programs serving individuals, households, or families are subject to eligibility restrictions, and in its view, no HHS programs have been formally exempted under PRWORA’s limited exceptions.

HHS states that the revised policy takes effect immediately upon publication in the Federal Register, but does not alter funding levels. The notice advises that additional verification guidance will be forthcoming, stating that “even if PRWORA and related regulatory activity do not mandate an entity to conduct verification of the immigration status of a person applying for benefits, nothing in the statute prohibits such an entity from conducting verification.”

HHS identified the following programs as satisfying the statutory definition of “Federal public benefit”:

• Certified Community Behavioral Health Clinics
• Community Mental Health Services Block Grant
• Community Services Block Grant (CSBG)
• Head Start
• Health Center Program
• Health Profession Education and Training Assistance’’, as described above (including grants, loans, scholarships, payments, and loan repayments)
• Health Workforce Programs not otherwise previously covered (including grants, loans, scholarships, payments, and loan repayments).
• Mental Health and Substance Use Disorder Treatment, Prevention, and Recovery Support Services Programs administered by the Substance Abuse and Mental Health Services Administration
• Projects for Assistance in Transition from Homelessness Grant Program
• Substance Use Prevention, Treatment, and Recovery Services Block Grant
• Title IV-E Educational and Training Voucher Program
• Title IV-E Kinship Guardianship Assistance Program
• Title IV-E Prevention Services Program
• Title X Family Planning Program

HHS notes that this list is NOT exhaustive. The notice states: “Any programs not listed in this notice or established after the date of this notice may still fall under the definition of Federal public benefit. Any additional programs determined to be Federal public benefits will be announced in program specific guidance.”

An announcement and the pre-publication draft of the proposed notice are available on HHS’s website here. As noted above, the notice establishing the revised policy takes effect immediately upon publication in the Federal Register. Comments on the proposed rule will be due to HHS within 30 days after the notice is published in the Federal Register, which can be expected to occur sometime this week.

Our federal grants, Head Start, and health care attorneys are evaluating the details of the Notice and will provide more detailed information soon.

Be sure to join Feldesman’s upcoming webinars on PRWORA impacts and federal grants updates: