How some Medicaid work requirements hurt freelancers and gig workers

In certain U.S. states, proposed and limited Medicaid work requirements are putting freelance and gig workers in a precarious position. These workers could risk losing access to health coverage. It’s not because they aren’t working, but because they struggle to prove they are.

Some states have sought federal approval to implement rules that require Medicaid recipients to verify they work at least 80 hours per month to remain eligible for benefits. While the stated goal is to promote employment, these policies often ignore the nature of today’s decentralized and irregular workforce. For freelancers, gig workers and part-time employees, providing proof of consistent work hours can be challenging.

Gig workers—think rideshare drivers, freelance creatives or app-based delivery workers—rarely follow traditional schedules. While one month may include 120 hours of work, another might come in just shy of 80. Income can fluctuate dramatically, and hour-by-hour logs are often unavailable.

Employers typically use platforms to track workers’ time and issue payments. These rarely include breakdowns of hours worked. Most freelance platforms issue lump-sum payments with no accompanying pay stub or breakdown of hours worked. Workers might receive a weekly or monthly statement of earnings, but these documents often fail to meet the verification standards Medicaid agencies require. The burden of tracking hours shifts entirely to the worker.

Even part-time W-2 employees are not immune. In some cases, particularly among smaller employers, payroll systems may not provide the kind of hour-level detail required for Medicaid verification. Workers in food service, caregiving or retail may technically work enough hours, but if their employer uses an outdated payroll system, gathering proof becomes difficult. In some cases, the payroll system doesn’t even track hours with the detail needed for monthly reporting. If states require monthly verification, this becomes a recurring administrative burden for the most precariously employed.

Employers and payroll platforms aren’t equipped

Another issue is structural. Many employers and gig platforms don’t consider these workers to be employees. Independent contractors are typically issued a 1099-NEC form at the end of the year, summarizing their annual income, rather than the number of hours or monthly work. That leaves a significant gap between what Medicaid asks for and what the worker can easily access.

Most employers use gig platforms to manage their contractors. These platforms use streamlined, low-cost back-end systems that aren’t designed to provide detailed documentation. Features such as hour tracking, customizable reports or responsive payroll support are often lacking. Even if the data exists, companies may be hesitant to provide documentation that blurs the line between contractor and employee, especially if it could suggest worker misclassification, thereby exposing them to legal risk.

Fragmented labor leads to fragmented records

Freelance and gig workers often combine income from multiple sources, including driving for Uber and DoorDash, taking on Upwork projects and completing odd jobs through TaskRabbit. They may work more than 80 hours a month. However, the labor is spread across platforms with no shared reporting standard, making piecing together a comprehensive monthly record a nightmare.

Some platforms, such as Upwork, offer limited tracking data (e.g., billed hours for hourly contracts), but not all workers utilize those features. Beyond that, they rarely translate into official documentation that satisfies Medicaid agencies’ requirements.

Add to that the practical barriers of navigating online portals, limited internet access or language barriers, and even highly motivated workers can fall through the cracks. Government systems aren’t known for being user-friendly, especially for those who are digitally or financially vulnerable. For example, Arkansas’ online portal was widely criticized for being difficult to navigate.

Why this matters

It’s important to note that Medicaid work requirements are not currently implemented nationwide. As of 2024, Georgia is the only state actively enforcing a Medicaid work requirement. Several other states previously sought waivers, but most proposals have faced legal setbacks or been withdrawn. Still, if additional states attempt to revive these policies, the consequences could be significant.

Most Medicaid work requirement proposals include exemptions for people who are pregnant, medically frail, disabled or acting as caregivers for dependents. However, applying for these exemptions requires additional documentation. This creates yet another layer of administrative complexity that can trip up eligible individuals.

Past implementations have shown that most people who lose Medicaid coverage under work requirements do so not because they failed to work, but because they failed to report properly. In Arkansas, over 18,000 people lost coverage in 2018 before the program was struck down in court. The vast majority were working or eligible for exemptions. They just couldn’t complete the documentation.

As Medicaid programs begin enforcing work and income verification rules more strictly, policymakers must address these structural flaws. Without reform, we risk penalizing workers who are already meeting the requirements, but can’t prove it. For millions of Americans navigating a modern, decentralized labor market, Medicaid’s paperwork burden may be just as damaging as being unemployed.

The bottom line

For many in the gig economy, Medicaid’s new or proposed documentation demands risk shutting out workers who are already doing the work. They meet the hour threshold—but lack the time, tools or employer support to prove it.

Policymakers must account for the complexity of the modern workforce when designing eligibility rules. Otherwise, the unintended consequence of these policies may be to punish exactly the kinds of hardworking, flexible workers our economy increasingly relies on.

Summary of risks for workers:

As Medicaid programs begin enforcing work and income verification rules more strictly, policymakers must address these structural flaws.

Without reform, we risk penalizing workers who are already meeting the requirements, but can’t prove it. For millions of Americans navigating a modern, decentralized labor market, Medicaid’s paperwork burden may be just as damaging as being unemployed.