Medicaid Stops Federal Payment for Many Immigrant Riders on October 1, 2026: What It Means for NEMT

Starting October 1, 2026, federal Medicaid money pays for full coverage only for U.S. citizens and nationals, three groups of immigrants, and, in states that choose it, lawfully residing children and pregnant women. Section 71109 of Public Law 119-21, signed July 4, 2025, made the change. The Centers for Medicare & Medicaid Services (CMS) told states on April 8, 2026 to recheck every affected member before that date. Refugees, asylees, and people here on parole are among the adults losing full Medicaid. When full coverage ends, the Medicaid ride benefit ends with it.

Key dates

Date	What happens
July 4, 2025	Public Law 119-21 becomes law
April 8, 2026	CMS issues State Health Official Letter SHO 26-001 on section 71109
July 31, 2026	CMS posts its state implementation checklist
Week of August 3, 2026	Virginia starts mailing notices to members who may be affected
September 1, 2026	Indiana tells providers which statuses still qualify
October 1, 2026	The federal payment limit takes effect in every state, DC, and the territories
December 31, 2026	Deadline for states to file the Medicaid state plan change, effective October 1, 2026
January 4, 2027	A matching Medicare limit applies to people already on Medicare

Who keeps full Medicaid

Section 71109 leaves the other eligibility rules alone. Income, residency, and the five-year wait for most green card holders stay the same. What changed is which immigration statuses let a state claim federal money for full coverage. CMS lists them in Appendix A of SHO 26-001.

Rider’s status	Full Medicaid from October 1, 2026
U.S. citizen or national	Yes
Lawful permanent resident (green card holder)	Yes, after the five-year wait, or sooner if exempt
Cuban or Haitian entrant	Yes
Compact of Free Association migrant (from Micronesia, the Marshall Islands, or Palau)	Yes
Refugee or asylee	No, unless a child or pregnant woman the state covers under its lawfully residing option (below)
Paroled into the U.S. for at least a year, or one of certain Afghan and Ukrainian parolees	No, with the same child and pregnancy exception
Granted withholding of deportation, or conditional entry before April 1, 1980	No, with the same exception
Survivor of battery or extreme cruelty qualifying under the Violence Against Women Act	No, with the same exception
Victim of trafficking with a T visa or a pending application	No, with the same exception
Veteran, service member, or Amerasian immigrant without a green card, or a noncitizen American Indian born in Canada	No, with the same exception
Undocumented, or any other status	Unchanged: emergency Medicaid only, unless a lawfully residing child or pregnant woman the state covers

The exception comes from the CHIPRA 214 option. States that elect it cover lawfully residing children (under 21 in Medicaid and under 19 in CHIP), pregnant women, or both. As of April 2026, CMS counted 39 states, the District of Columbia, and three territories using it. Medicaid.gov keeps the state list.

Two details help riders keep coverage. A refugee, asylee, or trafficking victim who later gets a green card generally stays exempt from the five-year wait, CMS says. Green card holders who are honorably discharged veterans or on active duty, and certain family members, are exempt too.

The limit also covers Medicare Savings Programs, the Medicaid help with Medicare costs. A separate section, 71201, limits Medicare itself to citizens, nationals, and the same three immigrant groups. For people already on Medicare on July 4, 2025, that limit applies 18 months later, on January 4, 2027. A Medicare Advantage plan requires Medicare Part A and Part B (42 CFR 422.50), so a rider who loses Medicare loses the plan’s ride benefit too.

How states end coverage

CMS treats the law as a change in circumstances. Each state had to find its affected members and redetermine them by October 1, 2026:

1. Check federal data first. The state rechecks each person’s status through the Department of Homeland Security’s SAVE system before contacting them.
2. Ask the member. If SAVE cannot confirm a qualifying status, the state asks for information and gives a reasonable time to answer.
3. Give 90 days when needed. A member who reports a new qualifying status that the state cannot verify right away keeps benefits during a 90-day reasonable opportunity period.
4. Check every other way to qualify. That includes the child and pregnancy option and emergency Medicaid.
5. Send notice. Medicaid members get at least 10 days’ advance notice and the right to a fair hearing. A member who asks for a hearing before the date of action keeps benefits until the decision. A state does not have to grant a hearing when the only issue raised is the change in law itself.

Pennsylvania, for example, says it reviews status before October 1, 2026, sends a notice to anyone no longer eligible, and ends that Medicaid on October 1, 2026.

Why emergency Medicaid does not cover rides

The ride benefit comes from 42 CFR 431.53, which requires each state to ensure necessary transportation for Medicaid beneficiaries to and from providers. People who lose full Medicaid can still qualify for emergency Medicaid, which pays only to treat an emergency medical condition (42 CFR 440.255). CMS’s transportation guide says that coverage can include emergency medical transportation. It is not the regular ride benefit.

Indiana spells this out. Its Transportation Services module lists Package E, Emergency Services Only, among the benefit plans with no NEMT coverage. Indiana’s September 1, 2026 bulletin says people who no longer qualify by status may still get Package E.

States may choose to cover some of these riders with state money. CMS says that coverage is not Medicaid. A state that does it must use a separate contract and payment with any health plan that provides it. Rides under a state-funded program can come with a different payer and different rules, so ask before you drive one.

What states are telling members

State	What it says
Pennsylvania	Refugees, asylees, humanitarian parolees, trafficking or domestic violence victims, and people with deportation withheld or conditional entry who are over 21 and not pregnant or postpartum may lose Medicaid on October 1, 2026
Virginia	Adults who are not pregnant or postpartum must be citizens, nationals, green card holders, Cuban or Haitian entrants, or Compact migrants. Rules for children and pregnant or postpartum members do not change. Notices went out starting the week of August 3, 2026.
Indiana	Only citizens and nationals, green card holders after the five-year wait unless exempt, Cuban or Haitian entrants, and Compact migrants qualify for full Medicaid or presumptive eligibility from October 1, 2026
North Carolina	Lawfully residing children up to age 19, and lawfully residing members who are pregnant or gave birth in the last 12 months, can keep Medicaid. Members who disagree with a notice usually have 60 days from its date to appeal.

What NEMT providers should do now

1. Check eligibility on the date of every ride from October 1. A standing order booked in September can outlast the rider’s coverage. Use your state portal or your broker’s tool. See Medicaid eligibility verification.
2. Read the benefit plan, not only “active.” In Indiana, for example, an emergency-only member still has a Medicaid card and shows in the eligibility system under Package E, which carries no ride benefit.
3. Let the state system answer the status question. You do not need to ask riders about their immigration status. The eligibility response shows what coverage they have on the ride date.
4. Point riders to their notice. A rider who mentions a Medicaid letter should read it and answer by the deadline. Asking for a fair hearing before the date the notice says coverage ends generally keeps coverage while the hearing is pending.
5. Ask your brokers how they handle cancellations. Find out what happens to trips already assigned to you for a member who lost coverage.
6. Offer another way to pay. A rider without Medicaid can still book a private pay ride. Follow your state’s rules first: Indiana, for example, lets you bill a member who is not eligible on the ride date only if you told them and they agreed in writing.
7. Add it to your intake questions. Our trip intake guide covers how to confirm coverage when a new rider calls.

This change lands just before others. The Medicaid work requirement and six-month renewals start in 2027, and retroactive coverage shrinks for applications from January 1, 2027. Together they make an eligibility check before every ride part of the daily routine.