Kansas withdrew from the Texas v. Kennedy lawsuit on June 12, reducing the coalition challenging federal disability integration rules from seven states to six. Today, June 15, the federal government filed its summary judgment brief defending the HHS Section 504 integration mandate, the Olmstead rule requiring states to provide services in the most integrated community setting appropriate to each person's needs.

States will file their final papers July 7. If you're a family whose child or adult family member receives Medicaid home and community-based services (HCBS), Medicaid waiver services, personal care, or day services, this case determines whether the federal government can require your state to offer community-based alternatives to institutional care.

Here's what happened, what the federal government is arguing, what remains at stake, and what you can do right now.

What Happened: The Coalition Is Shrinking

On March 6, 2026, seven states sued HHS challenging a Section 504 regulation that interprets the Olmstead integration mandate to require states to offer community-based services as an alternative to institutional placement. The states argued the rule exceeds federal authority and forces them to expand Medicaid beyond what the statute requires.

Three states have now withdrawn:

• Indiana dropped May 1
• South Dakota dropped May 12
• Kansas dropped June 12

Six states remain: Alaska, Florida, Louisiana, Missouri, Montana, and Texas.

The withdrawals signal that the legal theory underpinning the challenge, states' rights to refuse community service expansion, is weakening. Kansas did not issue a public statement explaining the withdrawal, but state Medicaid officials confirmed the decision in a June 13 letter to the court.

What the Federal Government Filed Today

The Department of Justice and HHS filed a 48-page brief defending the integration mandate. The argument centers on three points:

1. The Olmstead Ruling Is Binding Law

The Supreme Court ruled in Olmstead v. L.C. (1999) that unjustified institutionalization of people with disabilities violates the Americans with Disabilities Act. The Court held that states must provide services in the most integrated setting appropriate to each person's needs, as long as:

• The person's treatment professionals determine community placement is appropriate
• The person does not oppose community placement
• Community placement can be reasonably accommodated given the state's resources

The federal brief argues that Section 504 of the Rehabilitation Act, which prohibits disability discrimination by programs receiving federal funds, requires the same integration standard. Because Medicaid is federally funded, states that accept Medicaid dollars must comply with Olmstead.

2. The Rule Does Not Force States to Expand Medicaid

The states argue the integration mandate forces them to create new community-based services they don't currently offer, expanding Medicaid beyond what Congress authorized.

The federal government counters: the rule does not require states to expand services. It requires states that already operate institutional programs (nursing homes, intermediate care facilities for individuals with intellectual disabilities) to offer community-based alternatives when treatment professionals determine institutional placement is not medically necessary.

The brief cites data showing that all six remaining plaintiff states already operate Medicaid HCBS waiver programs. The integration mandate doesn't force them to create new programs. It requires them to offer existing community services to people who don't need institutional care.

3. The Cost Argument Doesn't Hold

The states claim community-based services cost more than institutional care. The federal brief cites CMS data showing the opposite: the average annual cost of institutional care in a nursing facility is $94,000 per person. The average cost of Medicaid HCBS waiver services is $52,000 per person.

The brief also notes that states control their own Medicaid budgets. The integration mandate does not require immediate expansion. It requires states to offer community placements to people currently institutionalized when doing so is appropriate and can be reasonably accommodated within the state's resources, the exact standard Olmstead established in 1999.

What's at Stake for Families

If the states win, the federal government loses enforcement power over Olmstead. States could continue operating nursing homes and ICF/IID facilities without offering community-based alternatives, even when a person's doctors say institutional care is not medically necessary.

Here's what that means in practice:

• Medicaid HCBS waiver programs: Your state could freeze enrollment, cap slots, or eliminate programs entirely without violating federal law.
• Personal care services: Your state could stop covering in-home attendant care and offer only nursing home placement as the alternative.
• Day programs and supported employment: Your state could cut community day services and offer only congregate facility-based programs.
• Transition from institutions: People currently in nursing homes who want to move home could be denied community placement indefinitely.

The integration mandate is the legal basis for every Medicaid waiver waiting list lawsuit, every state plan amendment requiring HCBS expansion, and every advocacy effort to move funding from institutions to community services. If it falls, the only remaining enforcement mechanism is the ADA, which requires individual plaintiffs to sue and prove discrimination case by case.

What the Federal Brief Means

The brief is thorough, cites 27 years of case law supporting Olmstead, and addresses every argument the states raised. Legal experts who reviewed the filing say the federal position is strong.

But the case is being heard in the Fifth Circuit Court of Appeals, which has a record of skepticism toward federal regulatory authority. The panel assigned to the case has not yet been announced.

If the Fifth Circuit rules for the states, the federal government will almost certainly appeal to the Supreme Court. That means a final decision could take 18-24 months.

What You Can Do Before July 7

1. File an Amicus Brief

Disability rights organizations are coordinating amicus briefs supporting the federal government's position. If your family depends on Medicaid HCBS, your story matters.

How to participate:

• Contact the Arc of the United States at advocacy@thearc.org
• Contact the Autistic Self Advocacy Network at hello@autisticadvocacy.org
• Contact Disability Rights Education & Defense Fund at dredf.org/contact

Amicus briefs are due June 30. Organizations are collecting family stories now. You do not need to be a lawyer to contribute. Your experience is the evidence.

2. Document Your Care Needs

If your state is one of the six remaining plaintiffs (Alaska, Florida, Louisiana, Missouri, Montana, Texas), document your family's current services and what would happen if they were cut:

• What Medicaid services does your family member receive? (HCBS waiver, personal care, day services, supported employment, respite)
• What would institutional placement look like for your family member? (nursing home, ICF/IID, out-of-state placement)
• What is the cost difference between your current services and institutional care?
• How long has your family member been on a waiver waiting list (if applicable)?

Save this documentation. If the case proceeds to trial, your state's Medicaid agency will be required to produce data on community service costs, waiting lists, and institutional placements. Advocacy groups will need family stories to counter that data.

3. Watch the July 7 Filing

The states will file their final summary judgment brief July 7. That brief will show whether the coalition has a unified legal strategy or whether the three withdrawals signal internal fractures.

After July 7, the court will schedule oral arguments. The Fifth Circuit typically hears arguments 60-90 days after briefing closes, which puts oral arguments in late August or early September.

4. Contact Your State Medicaid Director

If you live in Alaska, Florida, Louisiana, Missouri, Montana, or Texas, contact your state Medicaid director and ask why your state is challenging the integration mandate.

Find your state Medicaid director: medicaid.gov/about-us/contact-us/contact-state-page.html

Ask specific questions:

• How much does our state spend annually on institutional care vs. HCBS?
• How many people are on the HCBS waiver waiting list?
• What is the state's plan if the integration mandate is struck down?
• Will the state continue operating HCBS programs if the lawsuit succeeds?

State Medicaid agencies are required to respond to public inquiries. Document the response, or the lack of one.

What Happens Next

The timeline from here:

• July 7: States file final brief
• August/September: Oral arguments (date TBD)
• Fall 2026: Fifth Circuit ruling expected
• 2027: Possible Supreme Court appeal

This case will not resolve quickly. In the meantime, Medicaid HCBS programs continue operating under current law. The integration mandate remains in effect unless and until a court strikes it down.

If you're on a waiver waiting list, continue advocating for enrollment. If you're receiving services, continue documenting your care needs. If your state is a plaintiff, make your voice heard before July 7.

The federal government's brief is public. You can read it at: courtlistener.com (search "Texas v. Kennedy"). The full docket, including all state filings and the July 7 brief, will be available at the same link.

This is not abstract disability rights litigation. This is the case that determines whether your state can cut off access to community-based care and offer only institutional placement as the alternative. The window to act is closing before July 7.