Exclusive: Attorneys Break Down What’s Next In The Fight Over CMS’ CBD Pilot Program

A federal judge is reviewing a request to temporarily halt the Centers for Medicare and Medicaid Services’ new cannabinoid access pilot, a voluntary program that allows participating providers to furnish up to $500 in hemp‑derived CBD products per patient each year. Judge Trevor N. McFadden took Smart Approaches to Marijuana’s motion for a preliminary injunction under advisement after a hearing last week, leaving the pilot in place while the court studies the filings.

How The Lawsuit Reached This Stage

Smart Approaches to Marijuana (SAM) and several co‑plaintiffs filed suit earlier this year seeking to stop the pilot while the case proceeds. Their request for an emergency temporary restraining order was denied, which allowed the program to launch as scheduled. Taking the preliminary injunction motion under advisement means the judge chose not to rule from the bench and instead will issue a written decision after reviewing the arguments.

The plaintiffs argue that CMS exceeded its authority by creating a payment model that allows providers to supply hemp‑derived CBD products. Their claims include allegations that CMS issued a legislative rule without following the required notice-and-comment procedures, reversed prior policy positions without adequate explanation, and acted in a manner they believe is inconsistent with federal law. They also raise arbitrary and capricious challenges and assert that CMS lacks clear statutory authority to include cannabinoid products in a model intended to test cost‑saving approaches.

Advocates note that the pilot is voluntary, does not mandate the use of any cannabinoid product, and does not impose binding obligations on providers or beneficiaries. CMS has operated similar payment models for more than a decade without notice-and-comment rulemaking, and Congress has limited judicial review over certain elements of these programs. Standing is another issue, since none of the plaintiffs are required to participate in the model or are directly affected by it.

Court Considers Injunction Motion

Jonathan Havens, a partner at Saul Ewing, said the judge’s decision to take the motion under advisement means the parties now wait for a ruling.

“I presume if the judge agreed with what Sam was arguing, that maybe they would have issued some sort of a temporary restraining order or an injunction. But it doesn’t look like that’s happening,” Havens said. “For now, the program goes forward, and we’re all just waiting to see what the judge does with the emergency motion.”

Havens noted that the earlier refusal to block the program does not necessarily predict the outcome of the preliminary injunction request. 

“Just because a judge won’t issue an emergency block doesn’t mean the judge doesn’t see merit in eventually blocking the program,” he said.

On the substance of SAM’s claims, Havens said one issue likely to draw the court’s attention is the fact that the FDA has not approved the CBD products eligible under the pilot. 

“I think SAM’s argument is premised on the fact that the FDA has not approved the products that are eligible under this program,” he said. “I don’t know whether that’s strictly necessary, but I think that’s something that the court will probably be focusing on.”

What Happens Next

Judge McFadden will next decide whether to grant the preliminary injunction. The ruling could take several forms. The court could find that the plaintiffs lack standing, conclude that Congress barred judicial review of this type of model, deny the injunction on the merits, or temporarily halt the program while the case continues.

“The judge is reviewing the requests from SAM and deciding on them on the merits, whether this is something that should proceed and whether the court has the authority to grant this request,” Havens said.

If the injunction is denied, the case will move into the next phase of briefing, including motions to dismiss or for summary judgment. If the injunction is granted, CMS and participating providers would have to pause the pilot while the litigation unfolds.