Federal Judge Upholds Rule Requiring Medicaid Recipients to Verify Work Status

A recent ruling by a federal judge allows the continuation of a Trump administration rule requiring ‘medically frail’ Medicaid patients to prove inability to work for retaining health insurance. The Centers for Medicare and Medicaid Services (CMS) faced a lawsuit from 24 states with Democratic leadership after proposing Medicaid work requirements as part of President Donald Trump’s One Big Beautiful Bill Act. This lawsuit could affect 67 million Americans enrolled in Medicaid.

Massachusetts Attorney General Andrea Campbell, who co-led the lawsuit, expressed concerns, stating the changes provide insufficient time for states to adapt their implementation plans or effectively inform members about new requirements. Despite these concerns, a federal judge in Massachusetts recently declined to delay the rule during ongoing court proceedings, marking a legal victory for the Trump administration.

Jake Haselswerdt, a public policy professor, told Newsweek that CMS is permitted to proceed with enforcing the rule for the time being. Newsweek reached out to Campbell’s office and CMS for further comment.

Reasons Behind States’ Lawsuit Against Trump Administration

CMS announced the rule in June, mandating ‘applicable individuals’ on Medicaid to engage in at least 80 hours of qualifying activities monthly, including work or community engagement like educational programs, community service, or work programs. Broad exemptions apply, particularly for those considered ‘medically frail’ due to physical impairments. If a state fails to confirm compliance, a notice of noncompliance must be issued. Individuals have 30 days to demonstrate compliance or qualify for an exception. Failure to meet these criteria results in losing Medicaid coverage. States must enforce these requirements by January 1, 2027.

Campbell described these requirements as ‘burdensome,’ threatening healthcare access for vulnerable residents and families. She argued that Congress intended for individuals with serious medical conditions to maintain coverage. The lawsuit demands blocking unlawful provisions to protect Medicaid recipients and avoid unnecessary strain on Massachusetts’ healthcare system.

The lawsuit contends the rule exceeds allowances set by the One Big Beautiful Bill Act, emphasizing that individuals with disabilities, those undergoing cancer treatment, or facing serious health conditions shouldn’t risk losing necessary care. The lawsuit also questions the assumptions underlying self-attestation and renewal timelines, arguing states would need substantial investments to build new IT systems and processes, incurring significant costs.

Under the rule, individuals labeled ‘medically frail’ must have a condition that significantly impairs compliance with requirements. This includes those who are blind or disabled, have a substance use disability, a disabling mental disability, difficulty performing daily activities, or serious health conditions.

Implications for Medicaid Patients

Haselswerdt explained the potential impact on patients, highlighting that bureaucratic burdens may cause eligible individuals to lose or fail to obtain benefits. Vulnerable individuals face additional difficulties due to poverty, unstable living conditions, or chronic health problems.

He believes the case carries merit, noting ambiguity in defining ‘medically frail’ within existing terminology. He questioned the administration’s expansion of the definition for work requirements without Congressional specification.

Reasons for Judge’s Ruling Against Challenge

Judge Richard G. Stearns ruled in favor of the Trump administration, stating courts acknowledge unrecoverable financial damages from agency action as sufficient harm. The court felt states did not demonstrate expenditures wouldn’t be recoverable. Stearns noted the timeline imposed by Congress, not CMS, arguing harm attributed to CMS was unclear.

He clarified the ruling doesn’t reflect anticipated views on merits of the case, pointing out complex issues regarding Congressional delegation and execution of interpretative authority. Determining such matters, he noted, requires detailed record examination typically conducted during the summary judgment stage.