Judge Blocks Trump Rule on Medicaid Medical Exemptions

A federal judge in Boston blocked a Trump administration rule requiring chronically ill Medicaid recipients to prove their conditions significantly impaired their ability to meet work requirements before qualifying as medically frail. The ruling removes one barrier to care, but leaves the work requirements in place.

The State Sets the Test

U.S. District Judge Richard Stearns issued a partial victory to a coalition of 25 states and the District of Columbia, which sued the administration in June over guidance from the Centers for Medicare and Medicaid Services. The guidance tied to the 2025 law known as the “One Big Beautiful Bill” prompted the lawsuit.

That law defines medically frail people to include people who are blind or disabled; have substance use disorders or disabling mental disorders; have certain disabilities that significantly impair daily activities; or have serious or complex medical conditions. CMS added a further hurdle: people in those categories also had to show their conditions “significantly impair” their ability to comply with work requirements.

The plaintiffs argued that this stricter standard would block eligible Americans from needed care and exceeded the law’s text. The court blocked the added requirement. Some Medicaid recipients with qualifying medical conditions will now find it easier to obtain an exemption.

The government’s verification rules also carried costs central to the ruling. “The states have met their burden of showing irreparable harm for which monetary damages would provide inadequate compensation — they face the burden of costly and intensive alterations to their eligibility verification systems,” Stearns said in his 16-page decision. The states argued that changing their systems would impose a costly burden.

A Partial Brake, Not an Exit

Stearns didn’t strike down the work requirements. He upheld two other federal restrictions on how states verify medical frailty: states must reject proof based on a diagnosis more than a year old, and they may accept only one self-attestation during each continuous period of enrollment.

“The government provided a non-frivolous rationale for adopting each provision and explained why it did not find the States’ concerns of disenrollment compelling,” Stearns said. The ruling blocks one federal hurdle, but those other verification rules remain, as does the broader requirement to qualify for an exemption.

Starting Jan. 1, Medicaid expansion enrollees aged 19 to 64 must show they work or perform community service at least 80 hours a month, or attend school at least half the time. Exceptions include people considered medically frail and people in addiction treatment programs. The ruling changes how one group may qualify for an exception; it doesn't remove the state-imposed test of work, service or school attendance for expansion enrollees generally.

Medicaid expansion in most states extended the safety-net program to more lower-income people. Those covered through expansion now face eligibility rules tied to work or school, while people with qualifying medical conditions must navigate the exemption process. Under the administration’s rule, people already classified in specified medical categories would have had to prove an additional, work-related degree of impairment.

Representatives of the Department of Health and Human Services and CMS didn’t immediately respond to a request for comment. The ruling offers some relief from that added demand, but the larger work requirements and two verification restrictions remain.