Missouri Court Halts CMS Vaccine Mandate for Healthcare Workers in 10 States

On November 29, 2021, a federal court in Missouri issued a preliminary injunction to halt the Biden administration’s enforcement of a vaccine mandate for healthcare workers in 10 states.  The mandate was recently released on November 4, 2021 by the Centers for Medicare and Medicaid Services’ (CMS) as an Interim Final Rule (IFR) which required COVID-19 vaccination for covered healthcare staff by January 4, 2022.

The Challenge: How Did This Happen?

This preliminary ruling arises from a 10-state challenge to the IFR that was filed on November 10, 2021 by the attorneys general in Missouri, Nebraska, Arkansas, Kansas, Iowa, Wyoming, Alaska, South Dakota, North Dakota, and New Hampshire.  These states, led by Missouri’s attorney general, challenged the IFR on the basis that the rule fails to comply with both the Administrative Procedure Act (outlining the process and the discretion given to administrative agencies to make and enforce rules) and the U.S. Constitution’s Tenth Amendment (providing states with the authority to regulate public health).

The Injunction: What Does It Say?

Siding with the states, the Missouri federal court issued a preliminary injunction—which is an order typically used by courts to preserve the “status quo” pending a trial or final judgment—to stop CMS from enforcing the IFR within those select states.

In the order, the Missouri court established its proper jurisdiction (or authority) to hear Medicare and Medicaid claims, and addressed the necessity for a preliminary injunction.  Finding for a preliminary injunction requires consideration of four separate factors:

1. The threat of irreparable harm to the states;
2. The state of balance between this harm and the injury that granting the injunction will inflict on other parties litigant;
3. The probability that movant will succeed on the merits; and
4. The public interest.

Largely agreeing with issues raised by the states, the Missouri court found that each of the above factors favored the need to halt CMS’s vaccine mandate.  In its analysis, the court called attention to Congress’ silence on the vaccine mandate, stating that “the nature and breadth of the CMS mandate requires clear authorization from Congress—and Congress has provided none.”  Without clear Congressional approval, the court determined that CMS did not have express authority to instill a sweeping vaccine mandate of “vast economic and political significance” which “significantly alters the balance between state and federal power.”  Notably, the court stated that CMS’s mandate challenged “traditional notions of federalism” by seeking to overtake an area of traditional state authority through “federally dictat[ing] the private medical decisions of millions of Americans.”

The court also found that CMS’s vaccine mandate was an “unlawful promulgation of regulations” that bypassed the requirements of agency rulemaking as outlined in the Administrative Procedure Act and the Social Security Act, both of which require a notice and comment period before a rule takes effect.  The required notice and comment period can only be bypassed in rare circumstances (like emergencies) and for “good cause.”  The Missouri court relayed its skepticism on whether “good cause” existed by pointing to CMS’s own delay in promulgating the vaccine mandate.  In considering delays, the court specifically noted how CMS’s mandate was announced by President Biden in September 2021, nearly two months before CMS released the IFR and how the mandate itself permitted another one-month of delay for required vaccinations.  While the court recognized the unpredictable nature of the pandemic, it stated that CMS nevertheless had control “to act earlier than it did” which cut against CMS’s argument that the IFR was promulgated with “good cause” in response to an emergency.

Finally, the Missouri court also sided with the states’ argument that the IFR was an “arbitrary or capricious” rule. Under the Administrative Procedure Act, a court will hold unlawful or set aside agency actions that are unreasonable or unexplainable, under the statutory “arbitrary” or “capricious” standard. Here, the court stated CMS acted arbitrarily and capriciously by issuing the mandate because, among other reasons, the agency: (1) failed to gather evidence regarding COVID-19 and vaccinations for the IFR’s identified Medicare and Medicaid facilities; (2) improperly rejected alternatives to full vaccination, such as a COVID-19 testing alternative, without valid reasoning; and (3) included far too much in its scope, such third-party vendors providing services to covered Medicare and Medicaid facilities, without necessary justification.

The court also noted the potential harm that may arise without a preliminary injunction—primarily the needed preservation of state sovereignty and the potential impact to healthcare workforces (particularly in rural areas) which are already suffering from significant staffing shortages.  In considering all the factors above, the Missouri court granted the preliminary injunction in favor of the listed 10 states. This injunction prohibits CMS from enforcing the vaccine mandate in those states until a later date.

The Future: What Now?

Separate challenges to the IFR await resolution in other courts, but this preliminary injunction marks the first step in the eyes of those opposing the healthcare COVID-19 vaccine mandate.  While the injunction stands, the 10 named states (Missouri, Nebraska Arkansas, Kansas, Iowa, Wyoming, Alaska, South Dakota, North Dakota, and New Hampshire) are not subject to the CMS vaccine mandate.  This means CMS cannot implement or enforce the IFR in those 10 states until the court orders otherwise or until a trial is conducted on the merits.  If the injunction is appealed, it would be heard by a largely conservative Eighth Circuit. 

Practically speaking, it would be difficult for CMS to enforce the mandate in states outside of those 10 participating in this first lawsuit.  We believe CMS will likely make its intentions clear very soon.  For those entities located in one of the 10 states, it is reasonable to hold for now on any termination or separation with employees who have not been vaccinated and to hold on making any determination on pending exemption applications while the issue is pending with the court.  With the preliminary injunction in place, the court may not move quickly to rule on the merits of the case, particularly with litigation pending in other district courts or while an emergency appeal takes place in the Eighth Circuit Court of Appeals.