A sweeping change to Medicaid is heading to court. Enrollees and medical groups from five states have filed a lawsuit saying new federal work requirements could strip coverage from people with serious health conditions, including diabetes, HIV and cancer.
The rules are supposed to start on January 1, 2027. And the lawsuit argues the exemptions are too narrow and the paperwork too heavy, according to Stateline.
For millions of Black Americans who depend on Medicaid for doctor visits, prescriptions and long-term care, the outcome could impact access to health services in the next few years.
Medicaid is a joint federal and state program that covers low-income people, including children, pregnant women, older adults and people with disabilities.
According to the Center for Healthcare Strategies, Medicaid eligibility has mostly been based on income and certain categories like disability status. It has not required people to prove they are working.
The new federal rules mark a major shift because they make employment part of Medicaid eligibility across most of the country.
The timeline is already moving. CMS released initial guidance to states on December 8, 2025, according to multiple media reports. More detailed guidance came out on June 1, 2026, with definitions and clarifications.
States must implement work requirements by January 1, 2027, although they can start earlier through waivers. Nebraska became the first state to do so on May 1, 2026, according to CBS.
The law allows the HHS Secretary to grant extensions until December 31, 2028, but CMS says it will grant them only when states face extraordinary problems.
The lawsuit, filed in federal court in Maryland, challenges how the administration defined medical exemptions, Stateline reported. The One Big Beautiful Bill Act, signed last summer, created work, school or community service requirements for low-income adults who receive Medicaid under expansion or waiver programs in 44 states. The law says people who are medically frail should be exempt. But the lawsuit argues the administration’s rule severely limits who qualifies.
According to the Stateline report, the plaintiffs include Medicaid enrollees from Kentucky, Illinois, Indiana, Missouri and North Carolina. Several major medical groups also joined the case, including the American College of Physicians, the American Academy of Pediatrics, the Society for Adolescent Health and Medicine, Doctors for America and the New Hampshire Medical Society. The city of Columbus is also a plaintiff.
Those groups in the lawsuit warn that people with cancer, diabetes, HIV, substance use disorders and behavioral health conditions could lose coverage if they cannot meet the reporting rules. Individuals represented in the lawsuit have conditions such as autism spectrum disorder, obsessive compulsive disorder, bipolar disorder, severe vision impairments, HIV and narcolepsy.
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For Black Americans, the stakes are high. Cuts to the Medicaid program would hit vulnerable groups hard, and people of color would feel the impact the most because of structural inequities that leave Black and Hispanic families overrepresented among low-income households.
Medicaid is a major source of coverage because of long-standing disparities in income, job access and insurance. It covers a large share of Black children, pregnant people and adults living with chronic conditions. Losing coverage, even briefly, can mean missed medications, delayed appointments and higher medical bills. And for people managing diabetes, cancer and other health conditions, gaps in care can quickly become dangerous.
Today, nearly a third of Black and Hispanic people rely on Medicaid, more than 32 million people combined, and they stand to bear the brunt of any new cuts, according to research from the Economic Policy Institute.
Overall, Medicaid is a lifeline for many low-income households, including disabled residents, pregnant workers earning low wages and seniors who struggle to afford care.
The Affordable Care Act helped reduce the uninsured rate for Black and Hispanic people under 65 by more than 10 percentage points between 2010 and 2023, yet many states with large Black and Hispanic workforces still refused to expand coverage, according to the Economic Policy Institute.
After pandemic protections ended in 2023, Black and Hispanic individuals were twice as likely as white peers to lose Medicaid, EPI noted.
The case will move through federal court, and judges will decide whether the rules can take effect. The process could take months. If the court blocks the policy, Medicaid enrollees will keep the current rules.
If the court allows the policy to move forward, states will begin preparing for the 2027 rollout. That means new forms, new reporting systems and new outreach to millions of people.
The lawsuit could shape what Medicaid looks like in the future. People managing chronic or disabling conditions may need to stay alert, gather medical documents and make sure their contact information is updated with their state Medicaid office.
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