Federal Court Clears Trump's Medicaid Work Requirements, Denying States' Bid for Injunction
The Trump administration's sweeping overhaul of the federal Medicaid program has cleared its first major judicial hurdle. On July 29, 2026, U.S. District Judge Richard Stearns of the District of Massachusetts denied a request from a coalition of 25 Democratic-led states, the District of Columbia, and two Democratic governors to halt the implementation of the administration's new Medicaid work requirements1.
The multi-state lawsuit took aim at a June 2026 rule issued by the Centers for Medicare and Medicaid Services (CMS) and CMS Administrator Dr. Mehmet Oz, which significantly narrowed the definition of who can qualify as "medically frail"—a designation that excuses vulnerable enrollees with serious illnesses from the work mandates. The states argued that the narrow definition would force critically ill patients to navigate administrative hurdles to keep coverage and impose heavy administrative costs on states.
However, Judge Stearns ruled that the states failed to demonstrate that their financial damages rose to the level of justifying an "extraordinary measure" like a preliminary injunction, pointing out that the federal government will reimburse states for 90% of the implementation costs. While acknowledging that the case presents "difficult issues" regarding the scope of congressional delegation, the ruling allowed the work requirements to take legal effect on Friday, July 31, 2026.
Following the ruling, the first coverage losses began on August 1, 2026. In Nebraska, which launched its work requirements early, Medicaid Director Drew Gonshorowski confirmed that roughly 200 residents immediately lost health coverage. Across the nation, between 3 million and 10 million people are projected to lose health coverage over the next decade as states race to implement the 80-hour monthly work, volunteering, or schooling mandates before the final January 1, 2027 deadline.
"Because injunctive relief is the exception, not the rule, there is a certain point at which damages fail to justify the issuance of such an extraordinary measure. Plaintiffs have not shown that their damages rise above that minimal threshold here. Moreover, the additional costs that may be incurred by the States are unlikely to bloom disproportionately given the familiarity of the responsible state agencies with the tasks to be performed." — U.S. District Judge Richard Stearns, quoted in Stateline
"On Aug. 1, the first Americans lose Medicaid under Trump’s work rules. Nebraska's Medicaid director, in an exclusive interview with nonprofit news organization Tradeoffs, said roughly 200 people will lose health coverage on Aug. 1." — NPR News reporting on early implementation in Nebraska
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An instance of The primary check on unilateral executive power has shifted to multi-state litigation coalitions. — It shows a large coalition of states organizing a unified legal challenge against federal administrative health policy overhauls. ↩︎