Politics
Oregon Leads Multistate Lawsuit to Block Medicaid Work Requirements
Oregon Attorney General Dan Rayfield filed a federal lawsuit Thursday with several other states, arguing that new Medicaid work requirements under H.R. 1 violate state sovereignty and could strip coverage from hundreds of thousands of Oregonians.
Oregon Attorney General Dan Rayfield filed a federal lawsuit Thursday in Eugene, joined by several other states, seeking to block new Medicaid work requirements set to take effect next year. The suit argues that the requirements, enacted as part of H.R. 1, the One Big Beautiful Bill Act, violate states' sovereign rights and fundamentally transform Medicaid from a needs-based health program into a work-incentive vehicle.
Under the new law, many Oregon Health Plan members will be required to prove they are working or volunteering to maintain coverage. State officials estimate that roughly 600,000 Oregonians will be subject to the rules, and more than 200,000 could lose access to the Oregon Health Plan in the coming years if the requirements go into effect.
The lawsuit contends that Medicaid, established in 1965, has long been a partnership between the federal government and states to deliver health care to the neediest Americans. While the program has evolvedâincluding through the Affordable Care Act's expansion, which added hundreds of thousands of Oregonians to the rollsâthe plaintiffs argue those changes did not alter the program's core objective of providing care based on need. H.R. 1, they say, does something different by imposing a novel eligibility system that conditions coverage on work.
The states cite a 2012 U.S. Supreme Court case that found Congress could not compel states to expand Medicaid by threatening to withhold all Medicaid fundsâa dynamic the court likened to putting a "gun to the head" of states. Oregon and its co-plaintiffs argue that H.R. 1's work requirements create a similar situation, leaving them no real option but to comply or risk billions in federal funding.
"The federal government may well have been within its rights to repeal the ACA's Medicaid expansion," the lawsuit acknowledges, but it argues that Congress and the Trump administration instead imposed a work requirement on expansion enrollees that alters the program "not in degree but in kind."
With billions in federal funding at stake, Oregon and other states have already begun building the administrative infrastructure needed to comply with the new rules, even as they challenge them in court. The White House referred comment to the Department of Health and Human Services, a defendant in the suit, which did not respond to a request for comment.
Whether the federalist argument will persuade a judge to block the work requirements remains uncertain. But for the hundreds of thousands of Oregonians who rely on the Oregon Health Plan, the outcome could determine whether they keep their coverage.