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SHO #26-001 RE: Implementation of Section 71109 “Alien Medicaid Eligibility” of the Working Families Tax Cut Legislation (Public Law 119-21) April 8, 2026 Dear State Health Official: This letter is one of a series that provides guidance on the implementation of Public Law (P.L.) 119- 21, which the Centers for Medicare & Medicaid Services (CMS) refers to as the “Working Families Tax Cut” (WFTC) legislation. The purpose of this State Health Official (SHO) letter is to provide Medicaid and Children’s Health Insurance Program (CHIP) policy and operational guidance to states1 related to implementation of section 71109 of the WFTC legislation, “Alien Medicaid Eligibility.” Beginning October 1, 2026, sections 1903(v)(5) and 2107(e)(1)(R) of the Social Security Act (the Act), as added and amended, respectively, by section 71109 of the WFTC legislation, generally limit federal financial participation (FFP) for medical assistance (Medicaid) and child or pregnancy-related health assistance (CHIP), with limited exceptions, to U.S. citizens and U.S. nationals, lawful permanent residents (LPRs), Cuban/Haitian entrants, and Compact of Free Association (COFA) migrants. This letter discusses in more detail the limitations on FFP and potential impacts on eligibility and availability of coverage, the implications for current beneficiaries, and the changes states may need to make to their systems and processes prior to October 1, 2026, to comply with the statutory changes made by section 71109 of the WFTC legislation. States should make any such changes to state systems and operations to protect program integrity, make accurate eligibility determinations, and ensure proper claiming of FFP, in accordance with sections 1903(v)(5) and 2107(e)(1)(R) of the Act. 1 For the purposes of this letter, “states” refers to the 50 states, the District of Columbia, and the United States (U.S.) territories of American Samoa, Commonwealth of the Northern Mariana Islands (CNMI), Guam, Puerto Rico, and the U.S. Virgin Islands, unless otherwise specified. DEPARTMENT OF HEALTH & HUMAN SERVICES Centers for Medicare & Medicaid Services 7500 Security Boulevard, Mail Stop S2-26-12 Baltimore, Maryland 21244-1850