Federal judge ends Medicaid restrictions against patients with serious illnesses

NORTH CAROLINA (WWAY) — Attorney General Jackson won a federal court ruling striking down a new Medicaid restriction that threatened life-saving healthcare coverage for an estimated 64,000 North Carolinians with cancer and other serious illnesses.

In June, Jackson sued the Centers for Medicare & Medicaid Services (CMS) and the U.S. Department of Health and Human Services after the agencies imposed a new requirement that made it harder for seriously ill patients to keep their Medicaid coverage.

The lawsuit argued that CMS had exceeded its authority by narrowing an exemption Congress explicitly created.

Under its new rule, a cancer patient undergoing chemotherapy could have been required to prove not only that they were seriously ill, but also that their illness prevented them from meeting an 80-hour monthly work requirement.

Thursday, the court ruled that CMS lacked authority to impose the additional restriction, ordered the unlawful language removed from the rule, and granted a permanent injunction against its enforcement.

Jackson said the ruling was a major victory and even shared one conversation he had with a mother whose son was going through chemotherapy.

“I want you to be the first person to know that we won this case. His health insurance is not going to be taken away from him,” said Jackson. “Imagine your mother is going through chemo, and then all of a sudden she starts getting hit with the bill. No more insurance. A lot of families just aren’t going to be able to do that.”

The ruling protects North Carolina’s ability to implement the new Medicaid requirements without imposing the unlawful additional test on patients.

NCDHHS and county social services departments had already begun preparing for the changes when CMS adopted its unlawful definition, creating additional administrative burdens and costs.

The broader Medicaid work requirements remain scheduled to take effect January 1, 2027.