Half of America’s Governors Sue Trump Over Who Counts as ‘Too Sick To Work’

Twenty-five states and the District of Columbia want a Boston judge to block a rule they say rewrites who is too sick to hold a job.A coalition of Democratic-led states filed suit in federal court in Boston on June 29, asking a judge to block the Trump administration’s new Medicaid work rule before it reshapes health coverage for millions of Americans.The case, now sitting before Judge Richard G. Stearns in the U.S. District Court for the District of Massachusetts, centers on a question that sounds almost bureaucratic until it is applied to a real person’s life: who gets to decide when someone is too sick to work.The lawsuit targets an interim final rule that the Centers for Medicare & Medicaid Services published on June 3, laying out how states must carry out the Medicaid work requirements Congress enacted in the One Big Beautiful Bill Act last year. Under that law, most adults aged 19 to 64 who qualify for Medicaid through expansion must complete 80 hours of work, schooling, job training, or community service each month to keep their coverage.Congress, however, carved out exceptions for people who are pregnant, caring for young children, or “medically frail.” It is that last term that has landed the administration in court.A professor emerita of health law and policy and founding chair of the Department of Health Policy at George Washington University’s Milken Institute School of Public Health, Sara Rosenbaum, told The New York Sun the exemption exists because of how Medicaid is designed.“This provision is recognition of a fundamental feature of Medicaid,” Ms. Rosenbaum said. “Medicaid is unlike other insurance programs — with normal insurance, including Medicare, you can’t enroll when you’re sick. Medicaid is built to embrace people at the time they really need health care.”Moreover, a professor of health policy management at George Washington University, Leighton Ku, told the Sun that Congress always understood some people have medical or mental health problems severe enough to make working impossible, and built the exemption around that reality.Yet the new rule, he says, layers on something Congress never wrote into the statute.“This makes it much harder for both patients and physicians to determine or document when someone is unable to work,” Mr. Ku said, noting that “the additional barrier not only means fewer people will qualify for an exemption, but the process of determining who is medically frail and unable to work will create huge paperwork burdens for patients and physicians so that fewer people even try to get the exemptions.”Who decides where “sick” ends and “should be working” begins — a doctor treating the patient, or a federal agency writing the rule from Washington — is the fight now sitting before the Boston judge. He will decide whether hundreds of thousands of Americans keep their health coverage or lose it because they could not produce the paperwork.A Narrower Definition, A Bigger FightThe 74-page complaint, filed alongside a motion for a preliminary injunction, contends the rule violates the Administrative Procedure Act by ignoring evidence that paperwork burdens, not laziness or fraud, are what typically knock eligible people off the rolls.A research professor at Georgetown University’s Center for Children and Families, Leo Cuello, told the Sun that “medically frail” was never a blank slate for the Centers for Medicare & Medicaid Services to redefine; it already existed in Medicaid law before Congress borrowed the term for the work-requirement exemption.“The way it’s interpreted in the Interim Final Rule is much narrower than the existing definition because it layers additional conditions on top,” Mr. Cuello said.He offered a hypothetical to explain the stakes. Imagine “100 people who have a substance use disorder, the clinical condition that would make them medically frail under the longstanding definition,” Mr. Cuello continued. Under the old approach, in which a diagnosis code alone triggered the exemption, all 100 would qualify automatically. Under the new standard, he said, for the sake of argument, now only 60 meet the qualification. Those 60 must now produce individualized proof rather than appear on a data list. Doctors, he explained, are being asked to make a judgment call for which they never were trained.“I don’t have any training or competence to tell you whether that person’s cancer means they’re unable to work 80 hours a month,” Mr. Cuello said. “No provider wants that role.”The head of the Centers for Medicare and Medicaid, Mehmet Oz, has defended the stricter reading as a matter of program integrity, saying at a briefing after the rule’s publication that the administration is “forgiving but we’re not foolish.”Dr. Oz has tied the stricter reading to a broader administration push against fraud in federal health programs. “We are serious about the consequences of dishonesty and self-attestation,” he told reporters on a call after the rule’s release. “We hope the vast, vast majority of people will be helped without ever having to talk to anybody, but in the rare instance where you’re self-attesting, you need to tell the truth.”Ms. Rosenbaum rebuffed that narrative. “Poor people do not overuse or abuse the program. They enroll in the program when they need health care — pregnant women, children, people with disabilities,” she said. “What this rule does is completely upend the entire structure of Medicaid. Congress did not touch the structure of Medicaid. It added new requirements; it didn’t change this very basic feature of the program.”The president of the Paragon Health Institute and an influential voice with the White House on health policy, Brian Blase, defends the tighter standard. His organization estimates that Medicaid paid out $1.1 trillion in improper payments in the last decade, a quadrupling that the institute attributes to the Affordable Care Act creating “a new category of able-bodied, working-age enrollees.”“Self-attestation alone for compliance or exemptions — particularly for medical frailty — risks repeating the improper enrollment and fraud seen in other programs when verification standards were weakened,” he said in a statement about the work requirement.A professor of economics at the University of Kentucky, Aaron Yelowitz, told the Sun the exemption is best understood as “a noisy classification problem,” where criteria that are too loose invite abuse but rules that are too tight strand people who genuinely cannot comply.He points out that federal disability policy has long used functional tests rather than diagnosis alone. Still, he warns the safeguards built into the new rule to protect those who truly qualify depend on a lot going right.“The safeguard depends on the person receiving the notice, understanding it, obtaining documentation from a provider, and returning it correctly,” Mr. Yelowitz said. “Each of those steps is a place where an eligible person can fall out of the program.”A Clock That’s Already TickingThe suing states say timing is their biggest immediate problem. Although the work requirement itself does not take effect until January 1, 2027, Congress ordered states to start notifying Medicaid recipients about the changes by August 31 of this year.Massachusetts officials say meeting that deadline means hiring staff and building costly technology systems almost from scratch, after months of CMS guidance that pointed toward a far simpler standard.Governor Bob Ferguson of Washington and five other governors had written to Health and Human Services Secretary Robert F. Kennedy Jr. in late May asking for more time to respond if the final rule included substantive policy changes; the plaintiff states that request went largely unheeded.According to Georgetown’s Center for Children and Families, the states also asked the Center for Medicare and Medicaid Services for a six-month delay in the January 1 deadline. This request could ease the urgency of the court fight if the agency agrees to it. A similar dispute over Medicaid matching funds in Minnesota was resolved last month through a negotiated compromise rather than a courtroom ruling, offering one possible template. For now, no hearing date has been set on the state’s request for a preliminary injunction.Not everyone, however, finds the states’ underlying legal argument strong.The director of health policy studies at the Cato Institute, Michael Cannon, told the Sun that “the plaintiffs’ substantive statutory claim appears weak.” He argues that CMS has broad discretion to interpret an ambiguous term such as “medically frail.” He sees more weight on the process side of the case.“The procedural claims likely have more merit,” Mr. Cannon said. “If the administration is evading the requirements of the Administrative Procedures Act, the courts should send them back to the drawing board.”As for the policy itself, he predicts state politics, not the courts, will ultimately decide how many people lose coverage. “States where those subsidies are popular will replace the lost federal funding with state funding,” Mr. Cannon said. “If states are unwilling to do that, that tells us those subsidies were not popular with voters in the first place.”The numbers attached to the underlying law are not small. The Congressional Budget Office estimates the work-requirement provisions will cut federal Medicaid spending by $326 billion over 10 years, part of a broader $911 billion reduction in federal Medicaid spending projected by the Kaiser Family Foundation. The foundation says roughly 4.8 million more people will become uninsured by 2034 as a result of the reductions.Ms. Rosenbaum warns the cost doesn’t disappear — it shifts to “those of us with insurance,” a strain she ties to rising small-employer premiums. Detractors note that Arkansas already ran the work-for-health-coverage experiment when the state launched its Medicaid work rule in June 2018 — only to have it shut down the following spring by a federal judge. During the requirement period, the state removed roughly 18,000 adults from the rolls. Employment during that same period did not rise, according to a Harvard study of the program. What Comes NextThe 25 states and the District of Columbia joining the suit represent a broad swath of the 41 states plus the District of Columbia that expanded Medicaid under the Affordable Care Act. Public comments on the CMS rule are due by July 31, the same date the agency has set for the rule’s effective date. The courtroom fight and the regulatory process are now running parallel in real time.Mr. Ku said he hopes the court “at least delays implementation of the CMS rule while more evidence is accumulated,” underscoring that he expects further litigation regardless of how Judge Stearns rules. If the rule takes effect as written, Mr. Ku says even more people will lose coverage. “Millions of people could lose access to care and have more illness and even more deaths,” he predicted.Mr. Cuello, for his part, says the scale of the coalition speaks for itself. “It’s significant and telling that so many states — 26, including D.C. — joined the lawsuit, well over half of the 41 states that have expanded Medicaid,” he said. “The states are materially harmed by an agency making changes that are inconsistent with the law, and it’s not surprising an APA lawsuit followed.”Ms. Rosenbaum, for one, isn’t waiting for the ruling to make her prediction. “If these rules go unchecked, in five years there will be essentially no people left enrolled in Medicaid through the expansion population,” she said, noting that the ripple effect in years to come could mean “there will be virtually nobody left” in the “medically frail” category.

Half of America’s Governors Sue Trump Over Who Counts as ‘Too Sick To Work’

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