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H.R. 1 Information for Partners

What You Need to Know About Work Requirements and 6-Month Renewals 

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H.R. 1 Overview

On July 4, 2025, a new federal law called H.R. 1 (also known as the “One Big Beautiful Bill Act” and the “Working Families Tax Cut Legislation”) was passed by Congress. Over the coming years, this law creates multiple changes to how AHCCCS determines eligibility, how AHCCCS members maintain coverage, and how health care is paid for throughout Arizona. This webpage is for managed care organizations, community-based organizations, providers, and other community partners to get information and resources to help individuals with the upcoming work requirements and six-month renewals.

Overview of Work Requirements

Starting January 1, 2027, federal law requires AHCCCS to implement work requirements for some adults ages 19–64 who are enrolled in the adult group. These individuals earn up to 133% of the federal poverty level. In 2026, this is about $1,769 monthly income for an individual and $3,658 monthly income for a family of four.

To meet work requirements, an individual must do at least one of these:

  1. Earn at least $580 per month
  2. Complete 80 hours of any of the following qualifying activities per month, or a combination of them:
    • Working (paid or unpaid)
    • Going to school
    • Job training or work program
    • Doing community service or volunteering
  3. Earn some income and complete some hours of qualifying activities per month
    • Receiving long-term services and supports (LTSS)
    • Eligible for AHCCCS due to disability

Some individuals may be exempt from work requirements if they are:

  • An American Indian or Alaska Native
  • A veteran with a 100% total disability rating
  • A parent, guardian, caretaker relative, or family caregiver for a child age 13 and younger or for an individual with a disability
  • A former foster youth under age 26
  • Living with a disabling mental health disorder
  • Living with blindness or a disability determined by the Social Security Administration (SSA)
  • Living with a physical, intellectual, or developmental disability that makes it hard to do at least one daily activity
  • Living with a serious or complex health condition that makes it hard to meet the work requirements
  • Living with a substance use disorder that makes it hard to meet the work requirements
  • Participating in a drug or alcohol treatment or rehabilitation program
  • Pregnant or within their 12-month postpartum period
  • Already meeting work requirements for TANF (Cash Assistance)
  • Already subject to work requirements for SNAP (Nutrition Assistance)
  • Currently in jail or prison or recently released within 3 months

AHCCCS has opted to offer all four available short-term hardship exemptions. These exemptions are:

  1. Receiving care in a hospital, nursing facility, psychiatric facility, or facility for people with intellectual disabilities.
  2. Traveling outside their community for an extended period to receive medical services for themselves or a dependent.
  3. Residing in a county where an emergency disaster was declared by the president.
  4. Residing in a county with high unemployment

For A and B exemptions, individuals will need to provide information to AHCCCS at their application. For C and D exemptions, AHCCCS will automatically let individuals know if those exemptions apply to them.

Overview of Six-Month Renewals

(Starting January 1, 2027)

Starting January 1, 2027, most individuals in the adult group will need to renew their AHCCCS coverage every six months instead of once a year. Individuals subject to work requirements are also subject to six-month renewals, with the exception of American Indians/Alaska Natives.

AHCCCS will transition individuals to 6-month renewals during their first renewal in 2027. Therefore, if an individual has a renewal that begins processing in 2026, they will stay on a 12-month renewal until their next renewal in 2027.

For Example:

If an individual renews in December 2026, they will be renewed until December 2027. Then in December 2027, they will move to a 6-month renewal cycle.

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The federal government allows $580 monthly income to be used as an alternative measure for the required 80 hours of qualifying activities. This is because 80 hours multiplied by the federal minimum wage ($7.25) is equal to $580.

The following are examples of income that count towards the $580 monthly income:

  • Income from a job
  • Gig work income
  • Self-employment income
  • Tips
  • Unemployment compensation
  • Social Security income
  • Social Security Disability Income (SSDI)
  • Retirement or pension income
  • Capital gains
  • Investment income
  • Rental and royalty income

For a complete list, please see AHCCCS’ Eligibility Policy Manual.

AHCCCS will follow federal guidelines for Modified Adjusted Gross Income (MAGI) income. The counted income of the MAGI household is used to determine if an individual meets the $580 income for work requirements. This means, if two individuals subject to work requirements are in the same MAGI household, then their total household income will be used to determine compliance with the requirements.

For example, Dan and Jessica are married and are both part of the adult group. Dan makes $350 a month, and Jessica makes $450 a month. Together they make $800. Because their household income is above $580 per month, they both meet the work requirements.

A seasonal worker is someone whose job only exists at certain times of the year, as the work is tied to a season. Some examples include a lifeguard at a summer pool, a ski instructor in the winter, or a retail worker brought on only for the winter holidays.

To assess compliance with work requirements, AHCCCS will average the individuals’ income over the 12 months prior to the month they apply. If the average monthly income over the prior 12 months is at least $580, then the individual meets the work requirements. If the average monthly income over the prior 12 months is not at least $580, then AHCCCS will look at the average from the prior 6 months. If the average monthly income over the prior 6 months is at least $580, then the individual meets the work requirements.

Work includes:

  • Employment, including gig work
  • Self-employment
  • Independent contractor work
  • Unpaid work, such as unpaid internships or working in exchange for goods or services

Half-time or full-time educational programs that count as a qualifying activity include:

  • Institution of higher education (college or university)
  • Program of career and technical education
  • High school
  • State approved program of study leading to a certificate of high school equivalence (e.g., GED)

Half-time enrollment is determined by the school. Enrollment in school starts on the individual’s first day of the term and continues through normal attendance and recesses (e.g., winter break). Enrollment ends at the end of the month in which the individual graduates, completes the semester without registering for the next one, withdraws, or is expelled, unless the individual enrolls in another program.

If an individual is considered enrolled less than half-time by the school, the federal government allows credits to be converted to hours as follows:

  • 1 credit hour = 3 education hours per week
  • 3 hours x 4.33 weeks/month = 12.99 hours/month

For example, Maria is in the adult group and is taking four credits. To convert this into hours, AHCCCS would multiple the credits by hours (4 credits x 3 hours = 12 education hours per week). Then, AHCCCS would multiple the education hours per week by 4.33 to get the total education hours per month (12 hours/week x 4.33 weeks/month = 51.96 hours/month). This means Maria needs to complete 28 more hours of other qualifying activities that month to meet the work requirements.

Job trainings or work programs include:

Volunteering must meet all of the following criteria to count:

  • Unpaid work, including court ordered community service done for the direct benefit of the community;
  • A structured program operated by a public agency or nonprofit organization; and
  • The type of activity, dates completed, and hours are tracked with a designated contact who can verify volunteer hours.

Partisan activities involving campaigning or volunteering for a political candidate or committee do not qualify. Helping people register to vote does count though.

Veterans with a qualifying disability rating are exempt from work requirements. A veteran qualifies for this exemption by having a 100% disability rating, or disability that Veterans Affairs compensates at the 100% level.

Caregivers for a child age 13 and younger or for an individual with a disability are exempt from work requirements. More than one caregiver in the same residence may qualify for an exemption based on these definitions:

  • Parent: A legal parent, including an adoptive parent, who provides some level of care to a child under 14 or to an individual with a disability.
  • Guardian: An adult appointed by the court to provide care for and make personal decisions on behalf of a child age 13 and younger or an individual with a disability. Guardianship limited to financial matters does not qualify.
  • Caretaker relative: An individual with a qualifying family relationship who lives with and has primary responsibility for the care of a child age 13 and younger or an individual with a disability.
  • Family caregiver: An adult family member or other individual with a significant relationship to a child age 13 and younger or an individual with a disability who provides care within a broad range of assistance. This includes individuals who:
    • Live with the care recipient and provide regular, non-incidental assistance;
    • Are relatives who provide regular, non-incidental assistance; or
    • Are not related to and do not live with the care recipient and provide at least 80 hours per month of non-incidental assistance.

Former foster care youth qualify for an exemption if they are under age 26 and were in foster care and enrolled in Medicaid when they turned 18.

An individual may qualify for this exemption if they:

  • Living with blindness or a disability determined by the Social Security Administration (SSA): An individual may qualify if the SSA has determined that they are blind (including severely limited vision even with corrective lenses), or that they have a physical or mental impairment that significantly limits their ability to meet the work requirements.
  • Living with a substance use disorder that makes it hard to meet the work requirements: An individual may qualify when a substance use disorder significantly limits their ability to meet the work requirements. Examples may include alcohol use disorder, opioid use disorder, and stimulant use disorder.
    • Note: There is a separate exemption for individuals who are participating in a qualifying drug or alcohol treatment program.
  • Living with a disabling mental health condition: An individual may qualify if a serious mental health condition significantly limits their ability to meet the work requirements.
  • Living with a physical, intellectual, or developmental disability that makes it hard to do at least one daily activity: An individual may qualify if a disability significantly limits their ability to perform one or more activities of daily living, such as eating, bathing, dressing, or moving around.
  • Living with a serious or complex medical condition that makes it hard to meet the work requirements: An individual may qualify if a serious or complex medical condition significantly limits their ability to meet the work requirements.


AHCCCS is awaiting additional information from the federal government before providing additional guidance on how individuals can qualify for this exemption. Please check back for additional information on this exemption.

An individual who is participating in a drug or alcohol treatment or rehabilitation program is exempt from work requirements. Qualifying programs are those that are:

  • Operated by private nonprofit organizations or institutions; or
  • Operated by publicly funded community mental health centers that provide treatment aimed at the rehabilitation of individuals with a drug or alcohol addiction.

Individuals who are pregnant or within their 12-month postpartum period are exempt from work requirements. This is regardless of pregnancy outcome, including non-live births.

Individuals who are members of a household receiving SNAP (Nutrition Assistance) are exempt from AHCCCS work requirements when they are subject to SNAP (Nutrition Assistance) work requirements.

Individuals who are already meeting work requirements for TANF (Cash Assistance) are exempt from AHCCCS’ work requirements.

Individuals who are currently incarcerated in any of the following institutions are exempt from work requirements:

  • State or federal prisons
  • Local or county jails
  • Detention facilities
  • Similar correctional or penal institutions


Individuals who have been released from incarceration within the 3 months before the review month are also exempt from the work requirements. For example, if an individual applies for AHCCCS in July, they would be exempt from work requirements if they were in jail or prison anytime between March and May.

An individual may qualify for an exemption from work requirements if they are receiving:

  • Inpatient hospital services;
  • Nursing facility services;
  • Services in an intermediate care facility for individuals with intellectual disabilities;
  • Inpatient psychiatric hospital services; or
  • Other services of similar acuity, including certain services provided by critical access hospitals, emergency hospitals, or institutions for mental diseases (IMDs).

The individual, or someone acting on their behalf, will need to request this exemption from AHCCCS at application or during their renewal.

An individual may qualify for an exemption from work requirements if they, or a dependent, must travel outside their home community to receive care for a serious or complex condition not available locally. AHCCCS will establish specific documentation and process requirements for requesting this exemption.

AHCCCS will identify individuals who live in an Arizona county affected by an emergency or disaster declared by the President under federal law. Individuals who qualify will automatically receive a short-term hardship exemption from work requirements for the applicable month or months. AHCCCS will notify affected individuals when the exemption applies to them.

AHCCCS will identify Arizona counties with unemployment rates high enough to qualify for a short-term hardship exemption. A county may qualify when its unemployment rate is at least 8%, or at least 1.5 times the national unemployment rate.

For this exemption to apply, Arizona must submit a request to the federal government demonstrating that the affected area meets the applicable unemployment threshold, and it must be approved. If it is approved, individuals living in the affected area will receive the exemption automatically.

If an individual is not exempt and does not meet work requirements, AHCCCS will give them advance notice and a chance to fix it before their coverage is affected. If they still do not meet the requirements or qualify for an exemption after that, they may lose AHCCCS coverage.

First, if AHCCCS can’t tell from the information they already have, AHCCCS will send the individual a request for information. This request will ask the individual to show they are exempt or meet the qualifying activities. They will have 35 days to reply.

If the individual doesn’t reply in time, or the information isn’t enough, AHCCCS will send them a notice that their coverage will end at least 10 days before the effective date. It also explains the reason the coverage is ending, the date their coverage will end, and how to appeal if they disagree.

The individual should keep their address, phone number, and email up to date, and open all mail from AHCCCS, so they don’t miss these dates.

AHCCCS will attempt to verify whether individuals are either exempt or meet the requirements using available data sources. If AHCCCS cannot automatically verify, then AHCCCS may request information from the individual.

If AHCCCS cannot verify if an individual is exempt or meeting the requirements, then AHCCCS will send a letter to the individual requesting additional information. An individual will have 35 days to respond to the letter.

AHCCCS will assess whether an individual is exempt or meets work requirements as follows:

  • For new applicants on or after January 1, 2027, the month prior to their application.
  • For renewals on or after March 1, 2027, any one month since their last renewal.


Processing for renewals usually starts about 90 days before an individual’s AHCCCS renewal date. Because of this, individuals with March 2027 renewals will be the first that have to show they are exempt or meet work requirements.

Individuals whose coverage is renewed automatically will not receive a renewal packet. However, they will receive a notice explaining their renewal decision.

AHCCCS will attempt to verify whether individuals are exempt or meet the requirements using available data sources. Where it cannot verify automatically, the next step depends on the category.

Qualifying activities:

  • Income is verified as part of the application and renewal process, and it will not need to be reverified for work requirements.
  • For working, going to school, volunteering, and job training or work program, AHCCCS will attempt to verify using available data sources. If it cannot be verified automatically, AHCCCS will accept attestation for applications and renewals in 2027.

Exemptions:

  • For veteran status, specific health conditions, the caregiver exemptions, and the inpatient care and travel for medical care short-term exemptions, AHCCCS will attempt to verify using available data sources. If it cannot be verified automatically, AHCCCS will accept attestation for applications and renewals in 2027.
  • Pregnancy is verified by attestation as part of the eligibility process. AHCCCS will use data to verify the individual is within their 12-month postpartum period.
  • For American Indian/Alaska Native status, AHCCCS will attempt to verify using available data sources. If it cannot be verified automatically, AHCCCS will request information.
  • For SNAP (Nutrition Assistance) and TANF (Cash Assistance), AHCCCS will verify using available data sources and does not anticipate requesting an attestation from the individual.
  • For incarceration (currently or released in the last 3 months), AHCCCS will attempt to verify using available data sources. If AHCCCS cannot automatically verify through a data source they already have, AHCCCS will attempt to gather verification through a justice partner. If AHCCCS is still not able to gather the needed information, they will request information from the individual as verification is required.
    For the emergency or disaster declaration and high-unemployment short-term exemptions, AHCCCS will automatically verify on behalf of impacted individuals using available data sources.

Starting January 1, 2027, most individuals in the adult group will need to renew their AHCCCS coverage every six months instead of once a year.

All individuals in the adult group, except for American Indian/Alaska Natives, are subject to 6-month renewals.

Individuals subject to work requirements are also subject to six-month renewals, with the exception of American Indian/Alaska Natives.

AHCCCS will transition individuals to 6-month renewals during their first renewal in 2027. Therefore, if an individual has a renewal that begins processing in 2026, they will stay on a 12-month renewal until their next renewal in 2027. For example, if an individual renews in December 2026, they will be renewed until December 2027. Then in December 2027, they will move to a 6-month renewal cycle.

American Indians/Alaska Natives are not impacted by the new work requirements or the 6-month renewals.

AHCCCS will use available data and information collected at application to automatically exempt American Indians/Alaska Natives from work requirements. They will continue to remain on a 12-month renewal cycle.

While American Indians/Alaska Natives are exempt from work requirements, they will still receive a notice in September 2026. This is because the federal government requires all individuals in the adult group with AHCCCS coverage to be notified of the new work requirements.

Individuals impacted by work requirements will receive outreach from AHCCCS starting in September 2026. Help ensure they understand the information and complete next steps such as updating their contact information.

AHCCCS will attempt to verify whether individuals are exempt or meet the qualifying activities, and will reach out to them if additional documentation is required. Partners can help ensure individuals have the correct documentation to prove that they meet the exemption or qualifying activities, or help them find opportunities to meet the requirements.

Help ensure individuals keep their contact information — including their mailing address, phone number, and email address — up to date within the Health-e-Arizona Plus portal. Individuals can create an account or login at www.healthearizonaplus.gov.

If individuals have questions or need assistance submitting information, they may:

How Partners Can Help

Update Contact Information

Help ensure individuals with AHCCCS coverage keep their contact information, including their mailing address, phone number, and email address, up to date within the Health-e-Arizona Plus portal. Individuals can create an account or login at www.healthearizonaplus.gov. If they need help, they can:

  • Contact AHCCCS through live chat located on the AHCCCS or Health-e-Arizona Plus website at the bottom right of the homepage.
  • Contact a Community Assistor. They can search for one here.
  • Call (855) 220-0903.Recorded phone support is available from 7:00 am to 6:00 pm Arizona Time (Monday-Friday except state holidays).  
  • Visit their local AZ Department of Economic Security (DES) eligibility office. Find the nearest DES office online. 

Encourage Response to Notices

Individuals impacted by work requirements will receive outreach from AHCCCS starting in September 2026. They should check their mailbox and email at least weekly, and read all messages from DES or AHCCCS. These messages may have important information about changes to individuals’ AHCCCS coverage. Help ensure they understand the information and complete next steps such as updating their contact information.

Help Individuals Prepare for Upcoming Changes

AHCCCS will attempt to verify whether individuals are exempt or meet the qualifying activities, and will reach out to them if additional documentation is required. Partners can help ensure individuals have the correct documentation to prove that they meet the exemption or qualifying activities, or help them find opportunities to meet the requirements.

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