Labor & Employment Law Daily Wrap Up, AGENCY NEWS—N.D. Tex.: CMS’ nursing home staffing final rule struck down, (Apr 10, 2025)

By Cathleen Calhoun, J.D.

How did CMS exceed its authority when the HHS Secretary may impose conditions on funding in the interest of the health of those receiving the services?

The final rule created by CMS last year that would have expanded nursing home staffing has been vacated by a federal district court in Texas. Compliance with the rule was to begin in May 2026. The court found that CMS exceeded its statutory authority in creating the rule and that Congress had already enacted the hourly requirements of nursing home staff. Also, HHS Secretary Kennedy mentioned in his confirmation hearing that the nursing home staffing final rule would not go forward (American Heath Care Association v. Kennedy, Nos. 2:24-CV-114-Z-BR and 2:24-CV-171-Z (N.D. Tex. Apr. 7, 2025)).

Provisions challenged.Twenty states sued CMS challenging the nursing home staffing rule last year. In addition, the state of Texas filed suit and two nursing home trade groups sued with similar arguments. The final rule was challenged due to two provisions that were to become effective through a phase-in process:

1. Registered nurse (RN) onsite 24 hours per day, for 7 days a week (24/7 requirement).

2. Hours per resident day (HPRD) minimum staffing in three parts: 3.48 hours per resident day total nurse staffing requirement; minimum of 0.55 hours per resident day for registered nurses; and minimum of 2.45 hours per resident day for nurse aides

Nursing homes report their daily staffing hours to CMS, and CMS calculates a ratio of staffing hours per resident day. Staffing hours per resident per day is the total number of hours worked by each type of staff divided by the total number of residents.

Analysis. The court found that CMS exceeded its authority in enacting the final rule, and that CMS was issuing a regulation that replaces Congress’s preferred minimum hours with its own. Under the statutes, each Medicare or Medicaid nursing home must “…provide 24-hour licensed nursing services which are sufficient to meet the nursing needs of its residents…” and, with some exceptions “…use the services of a registered professional nurse for at least 8 consecutive hours a day, 7 days a week” (42 U.S.C. §§ 1396r(b)(4)(C)).

According to the court, while it is true that the HHS Secretary may impose conditions on funding in the interest of the health and safety of those receiving the services, CMS’ exercise of that authority in the 24/7 requirement “…plainly changes the minimum hours requirement Congress set as a statutory baseline.”

On the HPRD minimum staffing requirement portion of the rule, the court found that CMS lacks the authority to eliminate consideration of a facility’s nursing needs when prescribing minimum staffing standards. The court wrote, “Agencies may add to statutes consistent with their delegated authority and other laws. They may never cut statutes to replace them with their own requirements.”

The case is Nos. 2:24-CV-114-Z-BR and 2:24-CV-171-Z.

Judge: Kacsmaryk, M.

Attorneys: Thomas C. Riney (Underwood Law Firm, PC) and Bradley Timms (Brackett & Ellis PC) for American Health Care Association, Texas Health Care Association, Booker Hospital District and LeadingAge. Andrew James Rising, U.S. Department of Justice, for Robert F. Kennedy, Jr. and U.S. Department of Health and Human Services.

Companies: American Health Care Association; Texas Health Care Association; Booker Hospital District; LeadingAge; U.S. Department of Health and Human Services

Cases: FederalRegulations AgencyNews TexasNews