In the latest litigation over the federal staffing mandate, Judge Leonard T. Strand for the Northern District of Iowa vacated crucial aspects of the rule earlier this week, namely that a registered nurse (RN) needs to be on-site 24 hours a day, seven days a week.

The ruling also vacates implementing minimums of total nurse staffing hours per resident day. Both the 24/7 and hours per resident day (HPRD) requirements “violate the Medicare and Medicaid statutes,” according to the ruling.

Judge Strand did keep in place the enhanced facility assessments (EFA) and Medicaid institutional reporting requirements that are in the staffing mandate, while stating the federal government lacked authority to dictate the number of hours a nursing home needs to provide every day.

Legal experts see the decision as a major win for the nursing home industry.

The court vacated “the most egregious and costly aspects of the final rule,” Craig Conley, shareholder at law firm Baker Donelson, told Skilled Nursing News, referring to the HPRD and 24/7 RN requirements.

“I suspect HHS may appeal as it did in the Texas matter. I believe the ruling in Iowa falls in line with the other mandate rulings for the most part, as these rulings are a step in the right direction,” said Conley.

Mark Reagan, managing shareholder with Hooper Lundy & Bookman, told SNN there’s “little doubt” that CMS acted outside its jurisdiction in enacting these requirements of the staffing rule.

“As with the AHCA case in the 5th Circuit, I am confident that this decision would be upheld by the 8th Circuit, if appealed,” Reagan said.

Rachel Reeves, spokesperson for the American Health Care Association and National Center for Assisted Living (AHCA/NCAL) said the ruling is further confirmation that the staffing mandate doesn’t work for America’s seniors, and that the Center for Medicare and Medicaid Services (CMS) exceeded its authority.

“We look forward to putting these unrealistic requirements behind us and working with federal policymakers on more meaningful ways to strengthen the long-term care workforce as well as further enhance quality care,” Reeves said in a statement.

Latest in a string of staffing mandate-related legal rulings

The Iowa ruling follows an April 7 decision by District Judge Matthew J. Kacsmaryk of the U.S. District Court for Northern Texas, who invalidated the mandate’s minimum hourly staffing requirements.

CMS had aimed to establish minimum staffing requirements to improve quality and safety. However, the court sided with the nursing home industry, which had argued that CMS had overstepped its legal authority and failed to fully consider the policy’s practical implications, including severe workforce shortages.

At the beginning of this month, however, the Department of Health and Human Services (HHS) notified the U.S. District Court for the Northern District of Texas that it was appealing the decision to the Fifth Circuit Court of Appeals.

Some see the appeal as a way to reinstate the proposed staffing rule, undermining the nursing home industry’s confidence that the Trump administration would dismiss the rule. Others doubt the appeal signals any real change and is likely a placeholder to preserve potential savings for reconciliation in the Republican-backed budget reconciliation bill.

“The defendants assert that the court ‘should do no more than issue declaratory relief as to the specific provision deemed unlawful.’ They argue that the court should not vacate any portion of the Final Rule, as they maintain that relief should not extend beyond the parties to the case,” HHS wrote, defending the staffing rule in the Iowa court. “Nonetheless, if the court decides that vacatur is the appropriate remedy, the defendants request that it ‘should apply only to the portions of the Final Rule held to be unlawful.’”

HHS correctly noted that the Administrative Procedure Act (APA) doesn’t specify a court can say vacating a rule is an appropriate remedy when the court finds a rule violates the APA. But, the APA doesn’t say anything about vacating agency action, wholesale or otherwise, Judge Strand said in the ruling.

“Instead, it authorizes a reviewing court to ‘set aside’ agency action,” he said. “Indeed, I have deep concerns about a single United States District Judge taking actions that have the effect of operating as a nationwide injunction, applying beyond the parties to the particular case. For that reason, had I concluded that a preliminary injunction was appropriate, I would have limited that form of relief to the parties to this case.”

The Iowa judge ultimately made the determination that CMS lacked the authority to announce the HPRD and 24/7 RN requirements, while other aspects of the rule were within the agency’s authority.

“This vacatur applies writ large and is not limited to the plaintiffs in this case,” Strand said in the ruling.

This is a developing story and will be updated throughout the day.