Maryland AG Challenges Vulnerable Medicaid Work Requirements

The Attorney General of Maryland, Anthony G. Brown, along with a coalition of attorneys general and two governors, has launched a legal challenge against new Medicaid work requirements set by the U.S. Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS). The lawsuit targets an interim final rule issued on June 3, 2026, under the One Big Bill Act, introducing new community engagement requirements impacting Medicaid eligibility.

The Medicaid program, a crucial healthcare safety net for low-income individuals, is funded jointly by state and federal resources. Typically, the federal government covers at least half of the program's costs. The new rule modifies definitions like "medically frail," potentially limiting exemptions for vulnerable individuals and affecting their coverage.

States must notify Medicaid recipients about these changes by the end of August 2026, with the new requirements taking effect in January 2027. State officials argue that the revised rule complicates compliance with existing Medicaid provisions and imposes substantial financial risks from anticipated penalties.

Attorney General Brown stressed that the administration's reinterpretation of exemptions could exclude individuals with severe health conditions, despite congressional protective measures. Governor Moore of Maryland supported the lawsuit, voicing concerns over the barriers the rule poses for Medicaid beneficiaries seeking essential healthcare services.

The interim final rule's implications extend beyond changed exemption criteria. It introduces increased administrative demands, additional paperwork, and risks for potentially eligible individuals, such as those already meeting exemption conditions or actively working. Historical data indicates that such administrative hurdles have previously led to coverage losses and increased pressure on Medicaid programs, resulting in higher healthcare costs.

Maryland's assessments suggest that a large portion of its Medicaid participants, particularly those under the Affordable Care Act expansion, may face disenrollment due to the new requirements. The projected administrative costs associated with the rule's implementation are expected to rise, presenting further financial challenges for the state.

The coalition's lawsuit, filed with participation from attorneys general across several states, seeks to block the interim final rule, arguing its adverse effects on Medicaid access and deviation from legislative intent. This collective state action highlights widespread concern over regulatory changes impacting Medicaid's operational and financial frameworks.