From Mandate to Modernization: How to Take a Strategic Approach to H.R. 1

States are scrambling to begin adapting their Medicaid programs to meet the provisions of H.R. 1 (One Big Beautiful Bill Act of 2025). Changes are substantial, and the work ahead is daunting. Residency and work-verification mandates tighten eligibility. Fraud, waste, and abuse rules sharpen. Provider-tax provisions threaten already thin budgets.

While adapting to mandates is nothing new for Medicaid leaders, this is uncharted territory. It’s no surprise that leaders have a lot of questions about how H.R. 1 will impact coverage, eligibility systems, funding, system updates, operations and processing, and more. What’s more, tight timelines mean that states can’t wait to act before they have all of the answers.

Unfunded Mandate or Modernization Launchpad?

On the surface, H.R. 1 looks like one more unfunded mandate. Look closer, and it has the potential to be something entirely different, and much better. With the right approach, states can use H.R. 1 as a launchpad for faster modernization.

Just imagine the possibilities. A residency discrepancy is flagged the day it happens, not months later. A single, member-centric workflow verifies community-engagement status without driving churn. Dashboard KPIs tie every recovered dollar to a modernization milestone such as an analytics layer, portal upgrade, or process automation.

Three Ways to Unlock H.R. 1 as a Modernization Engine

Making these things a reality requires more than the right mindset. It requires the right actions. We believe that states should set the foundation now by prioritizing these actions:

• Treat integrity savings as modernization capital. Every ineligible enrollee identified, and every duplicate capitation recovered becomes “found” funding. When agencies reinvest those dollars in modular technology and real-time analytics, the cycle is never negative. Dollars saved buy the next upgrade.
• Move from quarterly to continuous verification. Waiting on the PARIS file or annual sweeps is no longer viable. H.R. 1’s aggressive timelines demand monthly, and eventually daily, signals that catch multi-state enrollment, residency drift, and work requirement gaps before payments go out the door.
• Build agility into the eligibility perimeter. Rules will evolve; data sources will multiply. States need configurable engines that snap into legacy cores, ingest new data feeds on the fly, and surface clear “act-or-hold” recommendations that their staff can trust.

State Medicaid agencies that pursue these actions will be in an enviable position. They will be able to free up resources even as H.R. 1 raises the bar. On the other hand, those that wait to act risk funding gaps, compliance findings, and member confusion.

How to Get Started

A back-to-basics approach is a good way to get started on these actions. This means ensuring that operational fundamentals are in order and fully aligned. Start with the following:

• Inventory data readiness. Determine whether or not the agency can absorb third-party address, employment, and mortality data without a re-platform.
• Define “never-negative” ROI. Set a rule and stick to it: every integrity dollar must feed the modernization backlog, no exceptions.
• Choose partners who operate at national scale. Go with partners that know the full picture but also slot into your roadmap, bringing proven verification experience, modular technology, and accountability to outcomes.

There is no ignoring the reality. H.R. 1 is here. The pressure is real. The concern is justified. As much concern that is swirling around this bill, there is a silver lining. With the right strategy and clear actions, states can use H.R. 1 to fuel the progress that their Medicaid program has needed all along.