The New Jersey Department of Human Services, Division of Medical Assistance and Health Services issued Medicaid Communication No. 26-06 on June 23, 2026. The communication announces significant operational changes to the NJ FamilyCare Medicaid fair hearing process, effective July 1, 2026. These changes end a series of temporary procedural flexibilities that DMAHS put in place during the COVID-19 public health emergency unwinding period, which concluded December 31, 2025. Beneficiaries, advocates, and practitioners who handle Medicaid appeals should review these changes carefully.

The three key changes are:

• End of automatic continuation of benefits pending appeal. During the unwinding period, benefits were automatically reinstated and continued for all members who filed a fair hearing request after a termination or reduction. That automatic reinstatement ends July 1, 2026. Going forward, members must affirmatively elect to continue benefits while their appeal is pending. If a member does not make that election, benefits will be paused. Members who elect continuation of benefits and ultimately lose their appeal may have the cost of services recouped by DMAHS under N.J.A.C. § 10:49-10.4(b) — but DMAHS has stated it will not seek recoupment for services delivered beyond the 90-day regulatory deadline for final administrative action, except in cases involving fraud or abuse of the hearing process.
• Return to the 20-day fair hearing filing deadline. During the unwinding period, DMAHS temporarily extended the filing period to 60 days. That extension ends July 1, 2026, and the standard 20-day deadline under N.J.A.C. § 10:49-10.3(b) resumes. However, DMAHS is building in 10 days of mailing presumption time — five days for standard mail processing and five days to account for the USPS postmark rule change effective December 24, 2025 — meaning fair hearing notices will state that members have 30 days from the date on the notice to file. The request must be made within that 30-day window, with proof of mailing or faxing.
• Resumption of DMAHS review of OAL Initial Decisions. Under standard procedure, OAL Administrative Law Judges conduct hearings and issue Initial Decisions, which DMAHS then reviews before issuing a Final Agency Decision. During the unwinding period, certain Initial Decisions in income, resource, and failure-to-provide-information cases were automatically adopted as Final Agency Decisions without DMAHS review. That shortcut ends July 1, 2026. DMAHS will now review Initial Decisions in all cases, though it expects to use a streamlined process for most routine cases, issuing a brief Final Agency Decision adopting the Initial Decision. Deeper review is reserved for cases involving material error, novel legal issues, or timely filed exceptions raising unusual circumstances.

The most consequential change for beneficiaries is the end of automatic aid continuation. Under the prior temporary process, filing a fair hearing request was sufficient to keep benefits running while the appeal was pending. That is no longer the case. Starting July 1, members who receive a termination or reduction notice must take an affirmative step to elect continuation of benefits — and the fair hearing notice itself will need to clearly communicate that option. Advocates should prepare clients to act on this immediately upon receipt of any adverse notice, and should ensure they understand the recoupment risk if the appeal is unsuccessful within the 90-day window.

The full communication, including a fact sheet with computation examples, is available here.