Judge sides with Texas in fight over Medicaid waiver

A federal judge on Friday issued a ruling that keeps in place Texas’ Medicaid agreement, blocking an effort by the Biden administration to rescind it.

Texas is one of only 12 states that have resisted expanding Medicaid coverage under a key provision of former President Barack Obama’s healthcare law. Instead, state Republican leaders negotiated waivers to provide billions of federal dollars in reimbursements to hospitals that serve the uninsured. Texas has the nation’s most uninsured residents.

Texas received its first Medicaid waiver a decade ago. The waiver was set to expire next year after the Biden administration rescinded the Trump administration’s 10-year extension of it.

U.S. District Judge J. Campbell Barker, an appointee of President Donald Trump, issued a preliminary injunction blocking the Biden administration’s effort.

A message to the U.S. Justice Department seeking comment on the decision was not immediately returned.

In April, the federal Centers for Medicare and Medicaid Services reversed the deal with the Trump administration, saying the agency previously “erred” because the approval during the coronavirus pandemic did not include the normal opportunity for public notice and comment. Texas Attorney General Ken Paxton challenged the decision in federal court.

The Biden administration has tried to financially incentivize GOP holdouts to opt into expansion , but none have indicated plans to change course.

Texas would receive about $5 billion over two years under the incentives. The state’s share of expanding coverage would be about $3.1 billion. With an expansion, more than 1.4 million people in the state could become eligible for coverage.