Attorney General Jeff Jackson Sues to Protect Healthcare for Tens of Thousands of North Carolinians with Cancer and Severe Illnesses

AG Jackson: “Cruel and illegal cuts will hurt the sickest people in North Carolina”

FOR IMMEDIATE RELEASE
Monday, June 29, 2026
Contact: comms@ncdoj.gov
919-538-2809

RALEIGH – Today, Attorney General Jeff Jackson sued the Centers for Medicare & Medicaid Services (CMS) and the U.S. Department of Health and Human Services over a new federal rule that puts tens of thousands of North Carolinians with cancer and other severe illnesses at risk of losing Medicaid coverage while they are still in treatment.

When Congress passed H.R. 1, the One Big Beautiful Bill Act, it added new work requirements that people with Medicaid expansion coverage must meet to keep their coverage. But Congress also created a specific protection for people with severe illnesses. The law said that people who are medically frail – including people with cancer, muscular dystrophy, cystic fibrosis, hemophilia, Parkinson’s, and other serious conditions – should not lose healthcare because they cannot meet new Medicaid requirements.

But CMS, the agency that administers Medicaid, then narrowed that protection. Attorney General Jackson’s lawsuit argues that CMS broke the law Congress passed by making it harder for very sick people to keep their coverage and putting back at risk the very patients Congress meant to protect.

The result is simple and cruel: Someone with stage 4 cancer who is in the middle of intensive chemotherapy could lose Medicaid coverage because they failed to meet the new work requirements. The consequences could be devastating for tens of thousands of North Carolinians.

“This is cruel and illegal. The sickest people in North Carolina – people with late-stage cancer and life-threatening illnesses – are being put at risk of losing healthcare while they are still in treatment,” said Attorney General Jeff Jackson. “Congress passed a law to protect these patients specifically. Then the Medicaid agency broke that law and put these patients back at risk. We’re going to court to defend the law and these patients.”

“Chemotherapy has left me with short-term memory issues,” said DeAnna Brandon, a North Carolinian being treated for blood cancer. “Some days, I walk into the kitchen to make dinner—and forget why I’m there. Now, I’m afraid I could lose Medicaid coverage because I accidentally missed paperwork. Even though I’m still eligible. Forgetfulness is not fraud. These changes to laws and policies are causing problems and stress for real people. We’re friends, family and neighbors; not statistics.”

“Our priority is to ensure eligible North Carolinians get and keep vital health care coverage they need to live healthy, productive lives,” said NC Health and Human Services Secretary Dev Sangvai. “The current guidance from our federal partners creates a barrier to care for some of the most vulnerable people in our state. We are grateful for the partnership with the North Carolina Department of Justice who shares our goal of protecting the life-saving care so many of our friends and neighbors depend on.”

“Multiple sclerosis is an episodic, relapsing condition, which can result in fluctuating neurologic symptoms,” said Dr. Casey A. Jeffreys, MD. “As a neurologist and multiple sclerosis specialist, I see patients across a wide spectrum of ability. Some of my patients work full-time without needing any accommodations, some work in flexible careers where they may be able to work a few days each week, some work a hybrid schedule so they can rest more on work-from-home days, some are unable to work at all, and some find their ability to work depends on the day, week, or month. A patient may be able to work a full day on Monday and be unable to get out of bed on Thursday. Someone with heat sensitivity may struggle to function during summer months but be capable and productive in winter.

“An overly restrictive definition of medical frailty jeopardizes healthcare access for patients whose condition does not fit neatly into a ‘sick enough’ label. This is not because they are not ill, but because their condition simply does not present that way. Furthermore, placing the burden of medical frailty determinations on physicians adds to an already unsustainable administrative workload and directly takes time away from patient care.”

Medicaid is a federal-state program that provides health insurance coverage to people with disabilities and people with lower incomes. In 2023, North Carolina expanded Medicaid. Since then, more than 730,000 North Carolinians have gained health insurance coverage. The expansion has also been a lifeline to keep rural hospitals open. Right now, roughly 15% of adults covered by Medicaid expansion nationwide are too sick to work. That means that at minimum, this rule could impact tens of thousands of North Carolina’s sickest people currently receiving Medicaid – at a maximum, it could impact nearly 100,000.

When Congress passed new Medicaid enrollment requirements as part of H.R. 1, it directed HHS and CMS to provide details to states about those new requirements by June 1, 2026, and directed states to tell enrollees how to prove they meet these additional requirements by July 1, 2026. As far back as November of last year, CMS told state health agencies that it would stick to the original, congressional definition of “medical frailty” – the same one Congress used when it passed H.R. 1.

NCDHHS and county social services departments began preparing to meet the new federal requirements, including by identifying people who are medically frail so those patients could continue getting care without interruption.

But on June 1, CMS changed the rules. It adopted a narrower definition of “medically frail” that violates the protection Congress created. Now, North Carolinians with life-threatening illnesses may have to prove not just that they are seriously sick, but that their illness prevents them from meeting an 80-hour monthly work requirement. For a cancer patient in chemotherapy, that could mean getting more medical records, more doctor’s notes, more evaluations, more forms, and more follow-up notices – all while trying to stay alive. And after going through all of that, they could still be denied the exemption, be found in violation of meeting the work requirement, and lose their Medicaid coverage.

North Carolina had already anticipated spending nearly $30 million to start putting H.R. 1’s Medicaid changes into effect and spending an additional $44.4 million every year after. Now, county social services departments need additional resources to apply CMS’s new definition and decide whether very sick people are sick enough to keep their healthcare. And about 10% of the county jobs that administer Medicaid are vacant, slowing down the process further.

Because CMS’s rollout of the new definitions has been so sloppy and haphazard, it creates additional risks for people in rural communities where access to care is more limited, or in areas that might be prone to serious natural disasters – like all of North Carolina. If this rule had been in place during the aftermath of Hurricane Helene, North Carolinians struggling to survive and rebuild their lives might have lost Medicaid coverage because they couldn’t prove to the federal government that they still met the requirements.

And if someone loses coverage for a period of time because they can’t complete the paperwork to keep their care, and then regains coverage later, they might be sicker and their care might cost more – increasing the cost of taxpayer healthcare.

Attorney General Jackson’s lawsuit alleges that CMS is violating the U.S. Constitution – which gives Congress the power of the purse – and the Administrative Procedure Act. He is asking the court to preliminarily and permanently ban CMS from implementing this change to the “medically frail” definition, while allowing the rest of the bill to take effect as scheduled.

A copy of the complaint is available here.

Attorney General Jackson is joined in filing this lawsuit by the Attorneys General of Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Hawaii, Illinois, Maine, Massachusetts, Maryland, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Virginia, Washington, and Wisconsin, and the Governors of Kentucky and Pennsylvania.

Eliminating waste, fraud, and abuse in the Medicaid program is an important, nonpartisan goal, but North Carolina is already working to do this without putting people with severe illnesses at risk. North Carolina’s Medicaid Investigations Division, which is part of the Department of Justice, is already one of the most efficient and productive units in the nation.

To date, MID has recovered more than $1.2 billion in restitution and penalties for North Carolina. MID has won more than $41 million in civil penalties since 2012 that go to fund North Carolina’s public schools.

Just last week, MID’s data mining efforts helped lead to charges in two federal cases as part of the federal government’s National Health Care Fraud Takedown.

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VIDEO (AVAILABLE FOR MEDIA USE)

Download the full video here.

Download segments from Attorney General Jackson’s video below:

Clip 1: “I’m doing this to protect health insurance for the most severely ill people in our state, people with cancer, Parkinson’s, cystic fibrosis, muscular dystrophy, all the most serious illnesses.”

Clip 2: “I know there are people listening right now who are worried about what this means for them or their family. I get that, but just hear me out: You let me worry about this. You focus on your family, on getting better, and you let me handle this fight for you. We’re on the right side of this, and we’ve got your back.”

GRAPHICS (AVAILABLE FOR MEDIA USE)

QUOTES (AVAILABLE FOR MEDIA USE)

“No eligible individual should lose Medicaid coverage due to administrative barriers or systems that fail to reflect the realities of complex medical conditions, where symptoms fluctuate and periods of stability and decline are often unpredictable. Brief disruptions in coverage can delay diagnosis, interrupt treatment, and lead to irreversible health consequences—outcomes that threaten not only access to care but the stability rare disease patients need to manage these often complex conditions.”

• Pamela Gavin, Chief Executive Officer (CEO) at the National Organization for Rare Disorders (NORD)

“Congress included the medical frailty protections to prevent individuals with serious health conditions from losing the healthcare coverage they need,” said Rhaegan Jackson, Director of Health Access for the North Carolina Alliance for Health and coordinator of the Keeping North Carolina Medicaid Strong coalition. “Rather than advancing that goal, the additional documentation and verification requirements in the interim final rule (IFR) create new administrative burdens for providers, patients, and state agencies, making it more difficult for medically vulnerable North Carolinians to maintain coverage, even when their health needs and eligibility have not changed.”

• Rhaegan Jackson, Director of Health Access for the North Carolina Alliance for Health and coordinator of the Keeping North Carolina Medicaid Strong coalition

STATISTICS (AVAILABLE FOR MEDIA USE)

• About 732,000 North Carolinians who received coverage through Medicaid expansion are expected to be affected by the new work-requirement framework (Source: NC braces for Medicaid work requirement cases | NC Health News)
• Rural North Carolina is disproportionately affected. North Carolina Medicaid says rural residents make up 19 percent of North Carolina’s population but 36.7 percent of the Medicaid expansion population (Source: NC Medicaid | NCDHHS)
• Medicaid covers at least half the population in several counties:
  • Robeson: 62%
  • Vance: 59%
  • Edgecombe: 58%
  • Richmond: 55%
  • Scotland: 53%
  • Swain: 50%
  • Bladen: 50%
• More than 244,500 rural residents had enrolled through Medicaid expansion by December 2025. (Source: North Carolina Celebrates Two Years of Medicaid Expansion | NCDHHS)

IMPACT OF FUNDING CUTS (AVAILABLE FOR MEDIA USE)

NC Health News: Federal Curveball upends NC’s plans for Medicaid work rule

• “In crafting the original legislation, Congress left the definition of medical frailty to the states, giving them latitude to set their own standards — an approach North Carolina and others had been counting on.”
• “Carrying out the requirement will require more than determining who qualifies for an exemption. States must also conduct eligibility reviews frequently, checking at least twice a year that beneficiaries still meet the standards so they continue to qualify.”
• “Unlike most of the other affected states, eligibility determinations in North Carolina are handled at the county level. This means the weight of implementing the requirement will fall largely on local social workers.”
• “The mandate comes as county social services offices are already stretched thin. About 10 percent of local social services positions dedicated to Medicaid statewide are vacant, according to NC DHHS.”

Associated Press: Too sick to work, but can they prove it? New Medicaid rule worries patients

• “Advocates said it is unclear what kind of documentation could prove that point. They said doctor notes may be required — something some providers don’t feel comfortable writing. Medicaid enrollees fighting disease may carry the bureaucratic burden.” “[DeAnna] Brandon, [a blood cancer survivor] who lives in Rockwell, North Carolina, is worried that new Medicaid work requirements starting next year could jeopardize her health coverage.”
• “If the government doesn’t accept [Brandon’s] case, she could lose her coverage and the twice-monthly maintenance chemotherapy that keeps her multiple myeloma in remission. Working is ‘outside of the realm of possibility for me,’ she said in an interview.”

NPR: People with cancer or HIV could lose Medicaid under new work rules, advocates say

• “Adrianna McIntyre, assistant professor of health policy at the Harvard T.H. Chan School of Public Health] and others foresee situations where a person newly diagnosed with cancer, who is working, loses Medicaid because they don’t fill out the paperwork correctly. That could lead to patients losing coverage when they need it most.”

American Heart Association: 48 patient organizations warn of massive coverage losses under final work reporting requirement rule

• “Our organizations are deeply concerned the interim final rule does not protect people with serious or complex health conditions and would instead dramatically and inappropriately increase the number of people who will lose their healthcare coverage.”

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