Key Moments
- Wells Fargo projects a 2% quarter-over-quarter decline in total U.S. Medicaid enrollment in the first quarter, with expansion enrollment down about 1%.
- Monthly enrollment in the bank’s state-level tracker fell 0.8% in January, 0.7% in February, and 0.5% in March, while California is pacing toward a 3% quarterly drop.
- An Urban Institute study indicates potential Medicaid enrollment losses of 4.9 million to 10.1 million people under work requirements and six-month redeterminations.
Quarterly Enrollment Trends
Wells Fargo analysts stated that overall Medicaid enrollment for the first quarter is on track to decline 2% compared with the prior quarter. Within that total, Medicaid expansion enrollment is anticipated to fall approximately 1% quarter-over-quarter.
According to the firm’s state-level Medicaid enrollment tracker, membership has been eroding each month of the quarter. The tracker showed a 0.8% decline in January, followed by a 0.7% drop in February and a 0.5% decrease in March.
State-Level Dynamics and California Focus
The report highlighted California as a notable outlier. Medicaid enrollment in the state is projected to fall 3% quarter-over-quarter, compared with a 1.3% decline in the fourth quarter of 2025.
| Metric | Change / Value |
|---|---|
| Total Medicaid enrollment – Q1 quarter-over-quarter | -2% |
| Expansion enrollment – Q1 quarter-over-quarter | -1% |
| Monthly enrollment change – January | -0.8% |
| Monthly enrollment change – February | -0.7% |
| Monthly enrollment change – March | -0.5% |
| California Q1 quarter-over-quarter change | -3% |
| California Q4 2025 quarter-over-quarter change | -1.3% |
| Average quarterly expansion enrollment decline in 2025 | -1.5% |
| Urban Institute projected enrollment loss range | 4.9 million – 10.1 million |
| Prior study estimates of enrollment loss | 5 million – 7 million |
Impact of Eligibility Checks and Risk Pool Quality
Wells Fargo attributed the ongoing weakening in Medicaid enrollment during 2025 to tighter eligibility verification processes put in place ahead of OBBBA policy changes. The bank said these more rigorous checks have contributed to a continued deterioration in the composition of the Medicaid risk pool.
The analysts emphasized that the enrollment pullback is being driven largely by eligibility verification activity rather than by broad macroeconomic shifts. They noted that this pattern is highly correlated with rising acuity among those who remain enrolled.
Wells Fargo also pointed out that the roughly 1% decline in first quarter expansion enrollment is running below the 2025 average quarterly decline of 1.5%.
Urban Institute Study on Work Requirements
The article referenced a new Urban Institute analysis examining the potential effects of Medicaid work requirements combined with a six-month redetermination cycle. The study estimated that enrollment losses could range from 4.9 million to 10.1 million individuals.
This projected span implies a broader range of possible outcomes than prior research, which had generally projected membership declines in the 5 million to 7 million range.
Drivers of Scenario Differences
Wells Fargo analysts outlined the main reasons the Urban Institute’s projections differ in scale from earlier assessments. They cited:
- A higher starting enrollment level associated with an expanded Medicaid age range in earlier proposals, compared with the final OBBBA framework.
- The inclusion of a six-month redetermination process in the newer analysis.
- Modeling assumptions that incorporate higher non-response rates than those observed in previous attempts to implement work requirements.
The analysts said these factors collectively help explain the wider and higher range of potential enrollment losses identified in the recent study.
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