There have been significant developments in the legal challenges brought against the interim final rule of the Centers for Medicare and Medicaid Services (“CMS rule”), which requires vaccination of all healthcare workers at CMS-covered facilities throughout the United States.

Most recently, on December 15, 2021 the U.S. Court of Appeals for the Fifth Circuit narrowed an injunction that had previously blocked CMS’ enforcement of its rule nationwide. Before the Fifth Circuit’s decision, two federal court preliminary injunctions effectively provided nationwide relief against enforcement: (i) the U.S. District Court for the Eastern District of Missouri blocked the CMS Rule in 10 states¹; and (ii) the U.S. District Court for the Western District of Louisiana blocked the CMS rule in the remaining states, although only 14 states had brought the lawsuit in which that injunction was entered.²

The Biden administration sought review of the nationwide injunction by the Fifth Circuit. The court’s December 15^th ruling narrowed the injunction by clearing the way for CMS to implement its rule in 26 states that were not parties to either federal litigation, noting, “This vaccine rule is an issue of great significance currently being litigated throughout the country.”

One of those 26 states – Texas – nonetheless remained a party in its own challenge to the CMS rule, in which Texas is the only state plaintiff.  In the Texas case, the district court had already conducted a hearing on the merits of the preliminary injunction motion on December 2, 2021, but had refrained from taking further action after CMS filed, on December 3, 2021, a notice that the Texas court required for the CMS to show the actions it had taken “to communicate to the affected providers and suppliers and to the general public of the preclusive effect on the CMS Vaccine Mandate of the Western District of Louisiana's preliminary injunction.”  Within hours after the Fifth Circuit decision on December 15, 2021, narrowing the Louisiana injunction only to the party states in that case, the district court on the Texas case convened an emergency hearing on Texas’ pending motion for preliminary injunction, and granted it later the very same day.

What’s Next For Employers?

How employers proceed in the wake of this ruling will depend on the status of any applicable injunction in the states where they operate, how and where the CMS proceeds with implementation and future developments in the courts including any new challenges brought against the rule. States where the CMS mandate remains enjoined despite the Fifth Circuit’s decision include Arizona, Alabama, Georgia, Idaho, Indiana, Kentucky, Louisiana, Mississippi, Montana, Ohio, Oklahoma, South Carolina, Utah and West Virginia.

States where the CMS mandate remains enjoined by the Missouri district court’s decision (which is pending review by the Eighth Circuit) include Alaska, Arkansas, Iowa, Kansas, Missouri, New Hampshire, Nebraska, Wyoming, North Dakota, and South Dakota.  The CMS mandate is also now currently enjoined in Texas by way of the Texas district court’s decision later in the day on December 15, 2021.

States where the CMS mandate is currently no longer enjoined because of the Fifth Circuit’s action include: California, Colorado, Connecticut, Delaware, Florida,³ Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Tennessee, Vermont, Virginia, Washington, and Wisconsin.

Prior to the Fifth Circuit’s action, CMS issued a December 2, 2021 memorandum to State Survey Agency Directors indicating that in light of the nationwide injunction it would voluntarily forgo implementation of the CMS rule and suspend its enforcement pending further developments in the litigation.

The states the Fifth Circuit has now excluded from the nationwide preliminary injunction could be subject to renewed enforcement by CMS on a go-forward basis, but CMS has not yet issued any indication on whether it will begin implementation of its rule anew in those states. If CMS does begin re-implementing its rule in California, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Tennessee, Vermont, Virginia, Washington, and Wisconsin, it may issue new compliance deadlines, including a deadline for a first (or only) vaccine dose.

Covered healthcare employers that may have felt rushed by the CMS rule earlier and think they may be subject to the CMS rule once more in the near future may consider using this time to prepare for compliance (e.g., by collecting proof of vaccination information, developing written policies, and planning how to minimize the risk of transmission of COVID-19 to at-risk individuals from unvaccinated employees provided accommodations in accordance with applicable law).

Covered healthcare employers should consult with counsel and continue to stay abreast of the assortment of state and local vaccine-related mandates, which are not affected by the injunctions against the CMS rule. Some state orders require that certain healthcare providers and staff be vaccinated while other states have passed laws limiting or banning vaccine mandates. And, while the CMS rule purportedly preempts contrary state and local laws—such as those limiting or banning vaccine mandates—CMS’s position has not been tested in court, and federal preemption does not apply so long as the CMS vaccine mandate is enjoined, meaning these state and local laws remain in effect until a court or an enforcement agency says otherwise.