Judge rejects lawsuit from 26 states challenging Medicaid work requirements
A lawsuit filed by a coalition of 26 states challenging new work requirements for Medicaid—put into place as part of the 2025 One Big, Beautiful Bill Act—has been struck down by a U.S. District Court judge.
The states, led by California and Massachusetts, were challenging the exclusions to the provision, particularly the definition of “medically frail.” The key provision would allow any American within the low-income threshold to gain access to Medicaid, regardless of their employment status or whether or not they are a student.
Otherwise, there is a minimum number of work and course hours that must be met for Medicaid enrollment.
In a statement announcing the legal filing, Massachusetts Attorney General Andrea Joy Campbell called the new guidelines an “abrupt change” that if allowed to stand would “make it significantly harder for vulnerable individuals to qualify for exclusions from the Medicaid work requirements and harder to maintain Medicaid coverage.”
Work requirements go into effect on Jan. 1, and states are required to notify beneficiaries about the change before the end of August.
The states—which in addition to the primary plaintiffs include Arizona, Colorado, Connecticut, Delaware, District of Columbia, Hawaii, Illinois, Kentucky, Maine, Maryland, Michigan, Minnesota, Nevada, New Mexico, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington and Wisconsin—argued that the timeline makes it difficult for them to adjust, as they do not have the resources necessary to enforce the new policy.
Notably, the Centers for Medicare & Medicaid Services (CMS) only revealed the new framework in June. Weeks later, the states filed their lawsuit, asking a court to issue an injunction blocking the rule—especially until there is a clear understanding of what it means for a patient to be medically frail.
On Wednesday, a federal judge in Massachusetts tossed the lawsuit. In his ruling, Judge Richard Stearns said the states failed to show how they will be irreparably harmed by complying with the policy. Specifically, he did not find that the states were able to show that eligibility determinations would be burdensome enough to warrant an injunction.
As Stearns noted in his decision, CMS will be covering 90% of the costs associated with setting up new systems to determine Medicaid eligibility based on the new work mandates.
"These are determinations that, in the view of the court, should be made on a developed record of the kind that informs a court’s decision at the summary judgment stage of a case," he wrote.
Questions unanswered
The states were also challenging the ability of CMS to implement the rule, arguing that it violated the Administrative Procedure Act, which governs how Executive Branch bodies may enforce the laws passed by Congress.
Stearns opted not to make a determination on the legitimacy of that claim, potentially giving future litigation some legs. But for now, the work requirements are set to go into effect as scheduled.
It’s unclear if and when the states will file another lawsuit or a formal appeal.
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.