The work requirements conversation at most FQHCs is happening in the compliance and operations function. The question being asked is: what does it cost to build the infrastructure to document, track, and support patient compliance with the 80-hour monthly community engagement requirement?
That is a real question. It is also the wrong starting point.
Compliance infrastructure — staff, systems, outreach — is a known and bounded cost. It is manageable, fundable, and one-time in nature. The financial model for work requirements compliance is relatively straightforward to build and relatively easy to present to a board.
The model most FQHCs have not built is the one that answers a different question entirely: what happens to our revenue if 10, 15, or 20 percent of our Medicaid panel loses coverage because they cannot meet the documentation requirement — not because they are ineligible, but because the administrative burden of proving eligibility exceeds what their circumstances allow?
The calculation most FQHCs are running
Most FQHCs preparing for Medicaid work requirements are calculating compliance costs. That is the wrong calculation.
Compliance infrastructure — staff, systems, outreach — is a known and bounded cost. It is manageable, fundable, and one-time in nature. The financial model for compliance is relatively straightforward to build and relatively easy to present to a board.
The model most FQHCs have not built answers a different question: what happens to revenue if 10, 15, or 20 percent of the Medicaid panel loses coverage because they cannot meet the documentation requirement — not because they are ineligible, but because the administrative burden of proving eligibility exceeds what their circumstances allow?
That is the patient loss model. It is larger, more complex, and more consequential than the compliance model. It is also the model that tells leadership whether the organization can absorb the loss — or needs to restructure before January 2027.
What Arkansas tells us about the real number
Arkansas implemented Medicaid work requirements in 2018 before federal courts halted the program. In the months the program was active, Arkansas lost approximately 18,000 Medicaid enrollees — the majority of whom were later found to still be eligible. They lost coverage not because their circumstances changed but because the documentation process failed them.
For an FQHC serving a panel with similar characteristics — patients with transportation barriers, unstable employment, limited digital access, and coverage instability — the Arkansas experience is the closest available data point for what procedural disenrollment looks like at scale.
The question every FQHC CFO should be running right now is: if Arkansas lost 18,000 enrollees in a partial implementation, what does a proportional loss look like against our specific panel — and what does that mean for our revenue, our 340B program, and our ability to sustain current service levels?
Source: Arkansas Medicaid work requirements — CMS and state Medicaid agency publicly documented data
The patient panel model nobody is building
Aggregate projections are not useful for FQHC financial planning. A state-level estimate that 5 percent of Medicaid expansion adults may lose coverage under work requirements tells an FQHC nothing specific about their organization.
The model that is actually useful is built at the patient panel level — identifying which specific patient segments within the FQHC’s active population are at highest risk of procedural disenrollment based on:
Employment status and income volatility. Documentation history and prior redetermination outcomes. Transportation and digital access barriers. Language and health literacy factors. Coverage history — how many times has this patient cycled off and back on.
When that model is built, the financial projection becomes specific — not a percentage of a state estimate but an actual patient count with associated revenue, 340B value, and visit volume attached to each at-risk segment.
That is the number that belongs in a board presentation. Most FQHCs do not have it. Most are not building it.
The two models every FQHC needs side by side
Work requirements financial planning requires two models running simultaneously — not one.
The compliance model answers: what does it cost to build the infrastructure to help our patients meet the documentation requirement and retain their coverage? This model is bounded, manageable, and fundable through operational budgets and grant sources.
The patient loss model answers: if our outreach and compliance infrastructure fails to retain X percent of at-risk patients, what is the revenue impact — by payer, by service line, by 340B program, and by fixed cost coverage ratio? This model is larger, more complex, and more consequential. It is also the model that tells leadership whether the organization can absorb the loss or needs to restructure before January 2027.
Building only the compliance model and presenting it to a board as work requirements financial planning is not wrong. It is incomplete in a way that leaves the organization exposed to a risk it has not quantified.
The deadline is fixed. January 2027 is not moving. The time to build the patient loss model is before the enrollment drop — not after the revenue impact appears on a quarterly report.
The compliance cost of Medicaid work requirements is a budget line. The patient loss is a financial model. Most FQHCs have built one and not the other.