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A Shift in Coverage: HHS Reinterprets “Federal Public Benefit” Under PRWORA

Client Alert

On July 10, 2025, the U.S. Department of Health and Human Services (HHS) rescinded a 1998 interpretation of “federal public benefit” as used in Title IV of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA). PRWORA was passed to restrict benefit eligibility for immigrants without legal status as well as many legal immigrants during their first few years in the U.S. The 1998 interpretation limited the scope of what qualified as a “federal public benefit,” allowing states to extend exemptions to immigrants for programs such as emergency services or public health.  

With this new notice, HHS intends to reverse what it calls “outdated exclusions” from the bill’s language, and newly includes the following programs as “federal public benefits” under PRWORA:

  • Certified Community Behavioral Health Clinics
  • Community Mental Health Services Block Grant
  • Community Services Block Grant (CSBG)
  • Head Start
  • Health Center Program
  • Health Workforce Programs not otherwise previously covered (including grants, loans, scholarships, payments, and loan repayments).
  • Mental Health and Substance Use Disorder Treatment, Prevention, and Recovery Support Services Programs administered by the Substance Abuse and Mental Health Services Administration
  • Projects for Assistance in Transition from Homelessness Grant Program
  • Substance Use Prevention, Treatment, and Recovery Services Block Grant
  • Title IV-E Educational and Training Voucher Program
  • Title IV-E Kinship Guardianship Assistance Program
  • Title IV-E Prevention Services Program
  • Title X Family Planning Program

The notice establishing the revised policy took effect immediately upon publication in the Federal Register on July 14, 2025. Comments on the proposed rule are due no later than 11:59 p.m. Eastern Time on August 13, 2025.

To learn more about “federal public benefits” under PRWORA and how this policy shift could impact your health care operations, please contact BMD Healthcare Member Daphne Kackloudis at dlkackloudis@bmdllc.com or Attorney Jordan Burdick at jaburdick@bmdllc.com.


Ohio Board of Nursing Proposes Rule Changes for Nurses

On Monday, January 12, 2026, the Ohio Board of Nursing (“BON”) released a package of proposed changes to the Ohio Administrative Code. There are two proposed changes to continuing education requirements that Ohio nurses should be watching.

New Florida Law: Patient Overpayments Must Be Refunded Within 30 Days

Effective January 1, 2026, Florida Senate Bill 1808 requires health care facilities and practitioners to refund patient overpayments within 30 days after an overpayment is identified. The law applies to overpayments tied to claims submitted to government programs or private insurers and introduces fines and disciplinary consequences for noncompliance. Providers should review billing and payment practices now to prepare for the new requirements.

USCIS Policy Change Impacting Work Authorization: Advisory for Employers and Human Resources

USCIS has issued a policy memorandum pausing immigration benefit processing for individuals from 19 high-risk countries and requiring a re-review of certain previously approved cases. This change may affect work authorization, employment verification, and workforce stability. Employers and HR teams should review impacted employees and update compliance procedures.

CMS Releases CY 2026 Medicare Physician Fee Schedule Final Rule with Key Payment and Telehealth Updates

CMS issued the CY 2026 Medicare Physician Fee Schedule Final Rule on October 31, 2025, with changes effective January 1, 2026. The Final Rule includes increases to the conversion factor, a new efficiency adjustment, updates to practice expense methodology, permanent telehealth policy changes, revised payment for skin substitutes, expanded rules for Part B drugs and biologicals, enhanced policies for Rural Health Clinics and Federally Qualified Health Centers, and new care management and behavioral health services.

Ohio Department of Medicaid Updates: Key Changes to Physician Reimbursement Rates in Early Parenthood

The Ohio Department of Medicaid has proposed amending Ohio Administrative Code Rule related to covered Medicaid reimbursements for physicians. Beginning on January 1, 2026, they are proposing an increase to rates for prenatal care, childbirth, and infant care and provider visits.