Federal Judge Blocks Trump Administration Rule Narrowing Medicaid Work Requirement Exemptions

A federal judge in Boston on Thursday blocked the Trump administration from enforcing a rule that narrowed who counts as medically frail under the new Medicaid work requirements, ruling that the administration added a hurdle Congress never wrote into the law.

US District Judge Richard Stearns sided with 25 states and the District of Columbia, which sued the administration in June over guidance from the Centers for Medicare and Medicaid Services. The judge struck down the part of the rule that limited the medically frail exemption, but he left the rest of the challenged provisions in place, and the work requirements themselves still take effect on January 1, 2027.

What the rule tried to do

Congress created the work requirements in the One Big Beautiful Bill Act, the tax and spending law President Donald Trump signed last year. Starting January 1, 2027, most Medicaid expansion enrollees aged 19 to 64 must complete at least 80 hours a month of work or community engagement, or be enrolled in an education program at least half time, to keep their coverage. The requirements are expected to reach about 18.5 million of Medicaid's 66 million enrollees.

The law exempts people who are medically frail. Congress defined that group to include people who are blind or disabled, people with a substance use disorder or a disabling mental disorder, people with a disability that significantly impairs daily activities, and people with a serious or complex medical condition.

The CMS rule, issued in June to tell states how to run the program, added a second test on top of those categories. Under the rule, a person also had to show that a physical, mental or behavioral health condition significantly impairs the individual's ability to comply with the community engagement requirement. Patient advocates warned the extra step could push seriously ill people, including cancer patients, through paperwork they could not manage.

What the judge decided

Stearns ruled that CMS went beyond its authority. The categories Congress listed set a floor for the exemption, he found, and the agency could not narrow them with an additional impairment test. He wrote that enforcement of an unlawful definition of medically frail may lead to the disenrollment of otherwise eligible vulnerable individuals relying on Medicaid coverage, and that states and the public could face the potential for great hardship.

In his 16-page ruling, Stearns also found the states had shown irreparable harm, pointing to the costly changes they would have to make to their eligibility verification systems to apply the narrower definition. The plaintiff states will have six months to update their verification systems without being penalized for errors or delays tied to the medically frail definition.

The states did not win everything. Stearns upheld a provision that bars states from relying on proof of medical frailty that is more than 12 months old, and he upheld limits on self-attestation. The work requirements themselves were not struck down and still begin on January 1.

How we got here

Twenty-five states and the District of Columbia sued in June, led by the attorneys general of California, Massachusetts and New Jersey. In July, Stearns refused to pause the rule while the case proceeded, but he said he aimed to decide the merits before the January 1 start date.

CMS declined to comment. The decision does not end the legal fight: in September, Medicaid beneficiaries and physician groups filed a separate lawsuit against the requirements, and that case is still pending.