A group of blue states and jurisdictions is taking legal action against the Trump administration over a recently introduced Medicaid work requirement, which they claim unlawfully limits health insurance access.
The lawsuit, involving at least 25 states along with the District of Columbia, argues that the new Interim Final Rule (IFR) from the Centers for Medicare and Medicaid Services (CMS) violates federal laws and strays from the original intent of Congress, as well as earlier guidance from CMS.
This IFR mandates that certain individuals provide documentation to prove they are exempt from Medicaid’s work requirements—those that generally expect enrollees to work, volunteer, or attend school if they are capable, due to serious medical conditions.
Before this rule was put into effect earlier this June, many vulnerable Medicaid recipients would have automatically qualified for exemptions without needing to provide additional documentation; CMS would have reviewed existing health records to confirm these exemptions, set to take effect in January 2027.
The lawsuit names Dr. Mehmet Oz, the CMS administrator responsible for the IFR, as well as Robert F. Kennedy Jr., the Secretary of the Department of Health and Human Services (HHS).
Dr. Oz has defended the necessity of these rules, arguing they are intended to keep the program from descending into chaos. He believes that individuals receiving U.S. tax dollars should contribute to society as well.
“If you’re able to work, then get up and do it,” Oz stated. He emphasizes the importance of safeguarding these programs, suggesting that tough decisions are needed to ensure their sustainability. It’s a bit of a balancing act, really. On one hand, he seems quite passionate about Medicaid; on the other, though, it raises questions about fairness and accessibility for those in need.
Under the newly implemented rules, individuals deemed able to work will need to engage in work for 20 hours each week, volunteer, or pursue education to continue receiving free health insurance.
The plaintiffs in the lawsuit include a diverse range of states, such as California, Connecticut, and New York, among others.
The complaint argues that “No person with a disability, undergoing cancer treatment, or suffering from another serious or complex health condition should have to risk losing the care that supports their health.”
Interestingly, the complaint cites CMS’ own projections, which estimate that around 2.3 million enrollees could lose their Medicaid coverage in the first year as a direct result of these changes. Additionally, they project that approximately 7% of individuals who are either employed or qualify for exemptions may also find themselves losing coverage—largely due to complicated administrative hoops, strict deadlines, or missing documentation.
Looking ahead to 2028, those who don’t swiftly maintain their medical records may only have one chance to fill out a “self-certification” form asserting they are too ill to work, with severe penalties for misrepresentation. This is a significant shift from previous guidance, which allowed enrollees to submit self-certifications multiple times based on evolving medical needs.
The plaintiffs argue that the new rules would compel states to discard the automated systems they’ve invested in, forcing them instead to develop more intricate and costly manual review processes.
As the deadline of August 31 approaches for sending notices to Medicaid enrollees, the plaintiffs are pushing for a stay and a preliminary injunction to block CMS and HHS from enforcing the new rule.
