Biden administration says it won’t keep messing with Texas' Trump-era Medicaid waiver

The Biden administration is dropping out of litigation against a Texas Medicaid waiver that the Trump administration approved during its final week in office, saying the yearlong court fight has overtaxed the federal government’s resources.

Last spring, the Centers for Medicaid and Medicaid Services revoked a 10-year waiver for Texas’ Medicaid program that the Trump administration approved on Jan. 15, 2021, without going through a required public comment period. The provision, which extended the state’s waiver for a decade, included significant money for health providers to cover the cost of caring for uninsured patients. Texas sued the Biden administration, and in August a federal district court judge reinstated the waiver. With CMS’ decision not to challenge that judge’s ruling, the provision will continue through 2030.

“The district court’s order on the preliminary injunction did not address the underlying legal issues,” CMS Administrator Chiquita Brooks-LaSure wrote in a letter to Texas. “However … CMS has concluded that it is not the best use of the federal government’s limited resources to continue to litigate this matter.”

The Medicaid waiver was significant for the state because it has the highest uninsured rate in the country — 17.5 percent of its population, according to the Kaiser Family Foundation. Texas is also one of a dozen conservative-led states that hasn’t expanded Medicaid under Obamacare.

In a statement Friday, Sen. John Cornyn (R-Texas) said he appreciated CMS’ ultimate decision but called the fight “a boneheaded move that could have cost lives.”

“Medicaid funding is vital for Texas’ most vulnerable, and the Biden Administration’s original decision put their care in jeopardy,” he said.

Last year, Texas Gov. Greg Abbott, a Republican, decried CMS’ battle against the provision, saying the “Biden administration is deliberately betraying Texans who depend on the resources made possible through this waiver.” A call to Abbott’s press office on Friday wasn’t immediately returned.