“Adjustment of status” is an option at the discretion of the administration (8 USC 1255(a)):

> The status of an alien who was inspected and admitted or paroled into the United States … may be adjusted by the Attorney General, in his discretion and under such regulations as he may prescribe, to that of an alien lawfully admitted for permanent residence

Note the “may” and the “in his discretion.” Basically, if the government really likes you, it can change your status. But that doesn’t change the primary purpose of the H1 visa from a temporary worker program into a permanent residency program.