Attorney General Mayes Secures Major Victory Blocking Implementation of Unlawful Medicaid Work Requirements for Medically Frail Individuals

PHOENIX — Attorney General Mayes today secured a decision in federal court finding the federal government's implementation of new Medicaid work requirements under the Big Beautiful Bill Act unlawful.

In a lawsuit filed in June 2026, Attorney General Mayes joined a multistate coalition in challenging provisions of an interim final rule, which adopted a new interpretation of key terms like “medically frail,” making it harder for medically vulnerable individuals to be excused from the work requirements. In today’s decision, the District Court held that the Administration’s definition of “medical frailty” is contrary to law, vacated the language, issued a permanent injunction, and granted the plaintiff states’ a six-month stay of enforcement to accommodate any errors or delays resulting from the necessary changes to implementation.

"This is a major victory that protects the most vulnerable, medically fragile Arizonans who rely on Medicaid to receive critical care,” said Attorney General Mayes. “Arizonans otherwise eligible for coverage shouldn’t lose access to their healthcare because of unnecessary red tape."

Background 

Medicaid is the nation’s safety net healthcare program for low-income Americans and is jointly funded by states and the federal government, with the federal government providing at least 50% of the cost of services. Congress created exemptions from Medicaid’s work requirements to ensure that people with serious illnesses and disabilities do not lose coverage or face interruptions in care.

Yet despite months of working with states on implementation, earlier this year, the Centers for Medicare & Medicaid Services (CMS) surprised states with an interim final rule that makes it harder for medically vulnerable individuals to be excused from the work requirements and makes other changes that increase administrative burdens, create unnecessary red tape, and put eligible people at risk of losing their health coverage — including those who are already working or qualify for an exemption. The rule disregarded substantial evidence that should have been considered, failed to adequately evaluate reasonable alternatives, and did not give states clear or workable guidance. 

Past Medicaid work requirement programs have shown that added red tape causes eligible people to lose coverage, placing greater strain on state Medicaid programs, safety net providers, and emergency rooms, while increasing costs as more medically frail residents become uninsured.