A Massachusetts District Court denied the request of 26 states to halt enforcement of the Medicaid Interim Final Rule (IFR) on Community Engagement Requirements in their state. In the suit, filed on June 29, 2026, the plaintiffs alleged that the IFR went significantly beyond the statute by requiring individuals seeking exclusion through “medical frailty” to demonstrate a connection between their serious or complex medical condition and their inability to meet the work requirement. The suit claims that the Centers for Medicare and Medicaid Services’ (CMS) rule did not contemplate the burden on the implementing states, was arbitrary and capricious in their expansion beyond the statute and called for “preliminary relief … to avert irreparable harm” by staying the IFR’s challenged provisions and effective date of July 31 in the plaintiff states. Preliminary relief was denied to the plaintiff states, though the judge indicated upcoming consultation of the parties to conduct full briefing of the arguments prior to the January 1 compliance date for work reporting requirements. The rule is effective July 31, and states will be proceeding accordingly with establishment of policy and IT systems necessary for compliance. Even if the suit proceeds, with a ruling in favor of the plaintiffs, work reporting requirements will remain, though some of the more onerous additions in the rule, such as qualification for an exclusion will be rolled back.

Our article on the release of the rule is available here.