New Jersey joined a coalition of 24 attorneys general and two governors seeking to block a federal rule they say would unlawfully tighten Medicaid work requirement exemptions for medically frail patients.
Trenton, NJ – New Jersey Attorney General Jennifer Davenport on Monday announced New Jersey is co-leading a lawsuit against the Trump administration over a new federal rule implementing Medicaid work requirements under the One Big Beautiful Bill Act. The lawsuit argues the rule unlawfully restricts exemptions for medically frail individuals and could cause eligible residents to lose healthcare coverage because of added administrative requirements.
The coalition, which includes 24 attorneys general and two governors, is asking the court to block the rule while the case moves forward. According to the complaint, the Centers for Medicare & Medicaid Services issued the interim final rule on June 1, after states had already begun preparing to implement the law based on earlier federal guidance.
State says rule exceeds federal law
Attorney General Davenport said the rule would require patients with serious medical conditions to prove their illnesses significantly impair their ability to work before qualifying for an exemption from the new work requirements.
“Everyone deserves affordable healthcare. The Trump Administration’s new rule kicks patients with stage 4 cancer and early onset Alzheimer’s off Medicaid, unless these patients jump through bureaucratic hoops to prove they are too sick to work,” Davenport said.
She added that the rule could have significant consequences for New Jersey residents.
“The new Medicaid work requirements are likely to cause over 300,000 New Jerseyans to lose access to lifesaving care due to onerous bureaucratic requirements, not actual ineligibility. We are suing to stop this cruel and unlawful rule. I will continue to fight against unlawful efforts that would increase costs to people with serious illnesses and disabilities.”
The lawsuit alleges the rule unlawfully narrows protections established by Congress for medically frail Medicaid recipients and violates the Administrative Procedure Act by failing to properly consider evidence that work reporting requirements can cause eligible individuals to lose coverage because of paperwork and administrative barriers.
Coalition cites implementation concerns
According to the complaint, the rule also creates additional reporting requirements for states and Medicaid beneficiaries while providing insufficient guidance for implementation. State officials argue they had already invested significant resources based on the law’s original language before the revised federal rule was issued.
Federal estimates cited in the lawsuit project that more than 3 million people nationwide could lose Medicaid coverage under the new work requirements, including many who remain eligible but fail to complete required documentation.
The coalition also argues the rule could increase costs for states, healthcare providers, and emergency departments as more medically vulnerable individuals become uninsured. Under the law, states must begin notifying Medicaid recipients about the changes by Aug. 31, ahead of the work requirement’s scheduled Jan. 1 implementation.
Virtual press conference scheduled
Davenport was scheduled to appear at a virtual press conference Monday evening alongside California Attorney General Rob Bonta and Massachusetts Attorney General Andrea Joy Campbell to discuss the lawsuit and the coalition’s legal challenge.
The case seeks to block the challenged provisions of the federal rule while the litigation proceeds.
Key Points
- New Jersey is co-leading a lawsuit challenging a federal Medicaid work requirement rule issued by the Trump administration.
- The coalition argues the rule unlawfully limits exemptions for medically frail individuals and could cause eligible residents to lose healthcare coverage.
- The lawsuit seeks to halt implementation of the disputed provisions while the case is pending in court.
Related: New Jersey Attorney General, Medicaid, Centers for Medicare & Medicaid Services, Jennifer Davenport, Trump Administration