On October 29, 2026, the U.S. District Court for the District of Massachusetts issued a decision in Commonwealth of Massachusetts et al. v. Oz et al. addressing medical frailty exclusions from Medicaid work and community engagement (CE) requirements under H.R. 1 (also known as the One Big Beautiful Bill Act). The ruling has three main components:

Medical Frailty
Verification Limits
Six-Month Protection Against Penalties

Court Ruling on Medical Frailty

H.R. 1 identified five categories of individuals who must be included in the medical frailty exclusion. CMS’s rule required people in those categories to meet an additional condition: they had to demonstrate that their medical condition significantly impaired their ability to comply with community engagement requirements. The court found that CMS exceeded its statutory authority and struck down CMS’s requirement that individuals who are medically frail must demonstrate that their condition significantly impairs their ability to comply with community engagement requirements.

The court also found that CMS could not use its rulemaking authority to narrow the groups Congress had already excluded. For example, an individual with a substance use disorder falls within a category H.R. 1 expressly included. CMS could not also require that person to demonstrate how the disorder affects their ability to meet the requirement. The court struck down the additional condition and permanently barred federal officials from applying it to the plaintiff states[1].

States still need to verify that an individual meets the relevant criteria for the category of exemption. For the physical, intellectual, or developmental disability category, the disability must still significantly impair at least one basic daily activity, such as bathing, dressing, or eating.

The court also found that CMS could not use its rulemaking authority to narrow the groups Congress had already excluded. For example, an individual with a substance use disorder falls within a category H.R. 1 expressly included. CMS could not also require that person to demonstrate how the disorder affects their ability to meet the requirement. The court struck down the additional condition and permanently barred federal officials from applying it to the plaintiff states ¹.

Verification Limits

Both verification provisions challenged in the case concern medical frailty. The court left in place the restriction on using claims and encounter data older than 12 months and the limit on accepting self-attestation once during a continuous period of Medicaid enrollment. These verification restrictions remain relevant to state implementation planning.

Six-Month Protection Against Penalties

The court’s order prohibits federal officials from penalizing plaintiff states for implementation errors or delays for six months following October 29, 2026. This protection gives those states time to adjust their processes, but it does not extend the January 1, 2027, statutory deadline.

What Should States Do Now?

States should assess where the additional impairment requirement is embedded in their implementation plans and identify needed changes:

Eligibility systems and workflows: Review business rules, screening questions, automated identification logic, and manual review procedures.
Verification materials: Revise forms and documentation requests that ask individuals or providers to establish the removed requirement.
Staff and partner guidance: Align training for eligibility workers, call centers, providers, managed care plans, and enrollment assistors.
Member communications: Update notices and public-facing materials so individuals receive consistent information about who qualifies for an exclusion.

States should continue preparing while monitoring potential appeals, requests to pause the ruling, and additional CMS guidance. Coordinating policy, systems, operations, and communications will help states apply the revised standard consistently and reduce avoidable coverage disruptions.

Aurrera Health helps states and their partners translate federal Medicaid policy on H.R. 1 into practical implementation strategies. To discuss tailored support, contact Lauren Block at lauren@aurrerahealth.com.

For a broader policy overview, see Aurrera Health’s earlier posts on medical frailty, federal Medicaid work requirements, and key implementation considerations.

References

Plaintiff jurisdictions: Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Hawaii, Illinois, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, and Wisconsin. Kentucky and Pennsylvania participate through their governors.

Author

Catherine Gekas Steeby [Deputy Director]

Court Ruling Changes Medicaid Medical Frailty Standard: What States Should Know