The dismissal of this case is effectively re-enforcing that this is a matter for each state to decide.
No, in this instance, the opposite is true. At issue in this case was Idaho's recently-enacted "Defense of Life Act," which effectively criminalized the act of performing an abortion except when, in the words of the Idaho law, "necessary to prevent the death of the pregnant woman."
A challenge was brought by the Biden administration in U.S. District Court in Idaho to this Idaho statute, contending that the state law was preempted by the federal Emergency Medical Treatment and Labor Act, which has been in existence for some 40 years. By the express terms of the EMTLA, it was argued, hospitals receiving Medicare funding were required to provide medical treatment -- including abortions -- in all those emergency situations where a pregnant woman faced serious injury (but something short of death) unless an abortion was performed.
The federal District Court in Idaho, concluding that the federal government was likely to prevail, entered an injunction pending a trial on the merits, thus enjoining the enforcement of the Idaho statute. On appeal to the U.S. Court of Appeals for the Ninth Circuit, the District Court's entering of the injunction on enforcement was affirmed.
The State of Idaho then sought emergency relief in the U.S. Supreme Court's so-called "shadow docket," asking the Court to take up the case itself -- i.e., grant certiorari before judgment -- while also requesting that the Supreme Court enter a stay of District Court's injunction. The Supreme Court initially granted Idaho's requested relief, thus allowing for enforcement of the Idaho statute to go forward.
What the Supreme Court has now done is, in the parlance of the Court's practice, dismiss the petition for certiorari as having been "improvidently granted" in the first place. As a result of this, the Supreme Court's own stay is dissolved, the District Court's original injunction goes back into effect, and enforcement of the Idaho statute is now once again enjoined. Trial on the merits -- i.e., whether the federal statute, EMTLA, really does preempt (which is to say, render invalid) the Idaho statute -- will now proceed in the U.S. District Court in Idaho.