Page 1 GAO-25-108160 Medicaid Demonstrations
September 3, 2025
The Honorable Ron Wyden
Ranking Member
Committee on Finance
United States Senate
The Honorable Frank Pallone, Jr.
Ranking Member
Committee on Energy and Commerce
House of Representatives
The Honorable Jon Ossoff
United States Senate
The Honorable Raphael Warnock
United States Senate
Medicaid Demonstrations: Information on Administrative Spending for Georgia Work
Requirements
Section 1115 demonstrations, which allow states to test new approaches to providing coverage
and services, have become a significant feature of the federal-state Medicaid program.
1
Section
1115 of the Social Security Act authorizes the Secretary of Health and Human Services to waive
certain federal Medicaid requirements and allow expenditures that would not otherwise be
eligible for federal matching funds for demonstration projects that, in the Secretary’s judgment,
are likely to promote the objectives of the Medicaid program. The Centers for Medicare &
Medicaid Services (CMS), within the Department of Health and Human Services, oversees
Medicaid demonstrations. In fiscal year 2023, federal spending for demonstrations was about
$194 billion, representing about a third of total federal Medicaid spending.
In January 2018, CMS issued guidance announcing a new opportunity for states to use
demonstrations to require certain beneficiaries to work or participate in community engagement
activities, such as vocational training or volunteer activities, as a condition of Medicaid eligibility
(referred to in this report as work requirements).
2
Since 2018, CMS has approved 13 state
demonstrations to test work requirements, including approving such a demonstration in Georgia
in 2020. However, a federal district court vacated the approvals in some states. CMS withdrew
approvals for other states. This included withdrawing the approval of certain authorities,
1
42 U.S.C. § 1315(a). Medicaid is a joint, federal-state program that finances health care coverage for low-income
and medically needy individuals. The federal government and states share in the financing of Medicaid expenditures
with the federal government matching most state expenditures.
2
See Centers for Medicare & Medicaid Services, Re: Opportunities to Promote Work and Community Engagement
Among Medicaid Beneficiaries, State Medicaid Director Letter, SMD: 18-002 (Baltimore, Md.: Jan. 11, 2018).
