Wells Fargo analysts reported that total Medicaid enrollment in the first quarter is tracking toward a 2% quarterly decline. Within that total, expansion enrollment is down roughly 1% on a quarter-over-quarter basis, according to the bank.
The bank's state-level Medicaid enrollment tracker documented monthly decreases of 0.8% in January, 0.7% in February and 0.5% in March. California stands out in the data, where enrollment is tracking toward a near 3% quarterly decline, compared with a 1.3% drop in the fourth quarter of 2025.
Wells Fargo attributes the continued erosion of the Medicaid risk pool in 2025 in part to the adoption of more stringent eligibility verification checks implemented ahead of OBBBA policy changes. The analysts emphasized that enrollment reductions driven by eligibility verification - rather than by underlying macroeconomic shifts - tend to be closely associated with rising acuity among remaining beneficiaries.
On the expansion population specifically, the first-quarter decline of about 1% sits below Wells Fargo's 2025 quarterly average decline of 1.5%.
The bank also highlighted findings from a new Urban Institute study examining Medicaid work requirement scenarios combined with a six-month redeterminations process. That study estimates potential enrollment losses in a range between 4.9 million and 10.1 million people. Wells Fargo noted the Urban Institute's range is broader than many prior studies, which generally produced estimates clustered between roughly 5 million and 7 million.
Wells Fargo analysts identified several factors that explain why the Urban Institute's projected losses span a wider range. Those factors include an initial jump-off point tied to an expanded Medicaid expansion age-range that appeared in earlier policy proposals but was narrower in the final OBBBA language, the inclusion of a six-month redetermination process, and modeling scenarios that assume higher non-response rates than those observed in historical attempts to implement work requirements.
Context and implications
The bank's analysis underscores how administrative policy and verification practices can materially alter enrollment counts and the composition of the Medicaid population, with potential consequences for acuity and cost dynamics for payers and providers. The data presented by Wells Fargo points to measurable monthly declines during the first quarter and highlights a wide range of possible enrollment impacts under different policy and response-rate assumptions.