BOSTON — In an order issued Thursday, a federal judge denied a request by 26 states to delay implementation of Medicaid work requirements announced in June.
The lawsuit, brought by 26 states, seeks to change one of President Trump’s biggest legislative priorities. The lawsuit focuses on implementing work requirements for Medicaid recipients, the details of which were announced in June with the goal of implementing the changes by January 1. But states also have until Aug. 31 to communicate with Medicaid recipients about how the changes will affect enrollees.
In an order Thursday, U.S. District Judge Richard G. Stearns of Massachusetts issued an initial decision denying the states’ requests for a preliminary injunction suspending implementation of the work requirements rules outlined in June. The states argued during Tuesday’s hearing that they do not have the staff or capacity to deploy the work requirements called for in the timeline laid out by the federal Centers for Medicare and Medicaid Services, which they wrote would “cause harm and disruption.” They also argued that this violated the Administrative Procedure Act, which governs how government agencies should implement policy changes.
“Despite months of regular communication with CMS and preliminary guidance materials on which the Plaintiff states based their implementation plans, CMS adopted rules that significantly narrow Congress’ clear exclusions from work requirements for some of our most vulnerable Medicaid members,” the states wrote in their lawsuit.
In response, government lawyers argued in pre-hearing submissions that Congress had authorized the agency to issue labor requirements when it passed HR1 last year, commonly referred to as the “One Big Beautiful Bill.” They also said they had taken due care in considering the impact of changing the definition of ‘medical frailty’.
The Bill Clinton-appointed judge wrote that it’s unclear how much of the blame for states facing tight timelines lies with CMS. “It is not clear how much of this harm is legitimately attributable to CMS; this schedule was set by Congress in HR 1, not by CMS in the challenged IFR,” he wrote. He added: “We are not satisfied that the states have shown that the expenditures are likely to be completely unrecoverable.”
The states argued during Tuesday’s hearing that CMS is violating Congress’s authority to interpret HR1 more narrowly than the text of the law. The justices denied the preliminary injunction, but wrote, “This case presents difficult questions regarding the scope of Congress’s delegation of interpretive authority to the Secretary and the fidelity to Congress’s intent for the Secretary to carry out his duties.”
Because the preliminary injunction was filed without prejudice, the case will proceed to a more thorough hearing on the merits. Stearns hopes to schedule a hearing before Jan. 1, when the work requirement takes effect. If the case stalls, states can reapply to the court for relief, he wrote.
