When 17 states filed suit in September 2024 to strike down parts of Section 504 of the Rehabilitation Act, families who rely on waiver services did the math and did not like the answer. The rule under attack is the one that says states have to serve people with disabilities in the most integrated setting appropriate to their needs. Take it away and a state can decide that a group home bed satisfies its obligation just as well as the supports that keep your adult son in his own apartment.

Missouri withdrew from that lawsuit this week. Three states are still in it: Texas, Florida, and Alaska.

How 17 States Became Three

The case, now called Texas v. Kennedy, started as a fight about a single line. A 2024 federal rule said gender dysphoria "may be a disability" under Section 504, and Republican attorneys general objected. What they filed, though, was broad enough to put the entire updated Section 504 regulation in play, including the integration mandate that community-based services rest on.

Disability organizations spent the next 18 months explaining that distinction to state officials, one attorney general's office at a time. Indiana left on May 1 and South Dakota followed on May 12. Kansas withdrew on June 10. Montana and Louisiana stopped appearing on court filings, and Missouri filed its exit this week.

A spokesperson for Missouri Attorney General Catherine Hanaway said the state was "thankful" that the gender dysphoria provision "has since been corrected," and that Hanaway "remains dedicated to protecting services for Missourians who need them most."

Sangyeal Lee, who leads the Missouri Developmental Disabilities Council's Olmstead standing committee, put his reaction more plainly: "Yahoo! Finally, somebody's thinking." Hannah Satterwhite of the St. Louis Arc thanked the office for protecting the rights of people with disabilities. Both of them had spent close to two years going to meetings and writing letters to an office that was not initially inclined to hear them.

Why the Case Still Matters After the Exits

Fourteen states leaving would ordinarily mean the threat is collapsing. This one is complicated by what the federal government did on June 18, when the Justice Department's Office of Legal Counsel issued a memo stating that federal law contains no integration mandate at all.

That memo puts the Department of Health and Human Services and the three remaining plaintiffs on roughly the same side of the argument. The states are asking a court to strike down a rule the federal government has now said it does not believe it can enforce. We covered what that DOJ position means for families when the memo came out, and nothing about Missouri's exit changes it.

The briefing schedule runs through the fall. The remaining states filed their opening briefs on May 4, the federal response came in June, and the states' reply is due September 22. A ruling would come after that.

The Money Argument Advocates Are Using

Missouri's own Department of Mental Health published numbers this year that make the practical case better than any legal brief. Self-directed supports cost the state an average of $48,534 per person in fiscal 2025. Residential services cost $227,317 per person.

Serving someone in their own home runs about a fifth of what it costs to serve them in a facility, which is part of why the integration mandate has survived administrations of both parties in the 26 years since the Supreme Court decided Olmstead. If your state legislature starts talking about institutional capacity as a budget solution, those two numbers belong in your first email.

What Families Can Do This Month

If you live in Texas, Florida, or Alaska, your attorney general is still a plaintiff. Contacting that office does more than anything else available to you right now, and the four states that already left did so partly because constituents made the ask directly.

Everywhere else, the work is documentation. Pull your current waiver service plan and confirm what setting each service is authorized in. If your family member receives supports in their own home or a shared apartment rather than a licensed facility, the paperwork showing that placement was chosen and works is what protects it if the legal ground shifts. Families weighing a move out of a facility can start with how Olmstead transitions work in practice.

State budget pressure is arriving on a separate track from the lawsuit, and several states are already cutting Medicaid services to close federal funding gaps. A weakened integration mandate would give those states more room to make the cuts fall on home-based care first.

Fourteen attorneys general have now taken their state's name off this case, and every one of those exits followed months of constituents asking for it. The three offices still on the filing take calls at the same numbers.