Court Blocks 'Illegal' Trump Rule That Created Barriers to Affordable Care Act Coverage

Officials in several cities joined advocacy groups in celebrating a federal court ruling Friday that blocked the Trump administration's rule which, they argued in a lawsuit, illegally imposed new fees and created barriers "that would make it harder—and in some cases impossible—for people to get and keep affordable health insurance."

The cities of Columbus, Ohio; Baltimore; and Chicago were among the plaintiffs in a case filed last week in the US District Court of Maryland against Health and Human Services Secretary Robert F. Kennedy and other Trump officials, arguing that the so-called "Marketplace Integrity and Affordability" rule would destabilize the insurance market and penalize vulnerable families, "rather than promoting affordability."

The rule was introduced in May, months after Affordable Care Act subsidies that had made ACA insurance premiums more affordable for millions of people were allowed to expire by Republicans in Congress. More than 1 million fewer Americans signed up for coverage in ACA exchanges after the tax credits expired, and the Trump administration claimed that the new rule's provision of more "catastrophic" insurance plans would give more "choice" to people who couldn't afford plans that cover more healthcare needs.

The rule also required additional verification for low-income households before they enroll in ACA plans, with Centers for Medicare and Medicaid Services Administrator Mehmet Oz claiming the new requirement "strengthens eligibility checks, cracks down on abuse, and gives insurers more flexibility to offer affordable, consumer-focused coverage options."

“Cloaked in the pretense of government efficiency and fraud prevention, the 2026 rule creates numerous barriers to affordable insurance coverage."

The verification requirements and new fees could cause as many as 2 million people to drop their coverage, said Democracy Forward, which represented the plaintiffs, as well as raising annual costs by about $700 for families.

“Cloaked in the pretense of government efficiency and fraud prevention, the 2026 rule creates numerous barriers to affordable insurance coverage, negating the ACA’s goal of extending affordable health coverage to all Americans, and instead increasing the population of underinsured and uninsured Americans,” the plaintiffs said in the lawsuit.

In the ruling on Friday, US District Judge Brendan Hurson vacated several provisions of the rule, including ones that revoked guaranteed insurance coverage for people with past-due premiums; required eligibility verification for the special ACA enrollment period; and imposed a $5 premium penalty on people who automatically reenrolled in their plans.

Columbus City Attorney Zach Klein said the rule's provisions were among "the Trump-Vance administration’s illegal attempts to undermine the Affordable Care Act."

“This ruling is a significant win for millions of Americans, including thousands in Ohio, who would have been denied coverage or seen their out-of-pocket costs skyrocket due to this president and his administration," said Klein. "We will continue to fight to protect healthcare coverage for all Americans whenever it’s threatened.”

Richard Trent, executive director of Main Street Alliance, a small business advocacy group that also joined the lawsuit, said that "the Trump-Vance administration’s unlawful attempt to undermine the Affordable Care Act would have increased costs, created unnecessary barriers to coverage, and made it harder for entrepreneurs and workers to get the care they need."

"Small business owners cannot grow their businesses when healthcare becomes more expensive and less accessible," said Trent. "We are grateful that the court has protected these critical safeguards and reaffirmed that affordable healthcare remains essential to a strong economy and thriving Main Streets across the country."

Baltimore Mayor Brandon Scott also applauded the ruling, but emphasized that healthcare advocates' "work is not over."

As Common Dreams reported Friday, tied up in the Trump administration's push for more Americans to use high-deductible catastrophic insurance—which is likely to present families with high out-of-pocket costs—is a plan to push households into more medical debt by allowing them to take out loans directly from their health insurance companies.

“We will continue to fight back against any attempts by this administration to slash protections under the ACA," said Scott, "and will not stop fighting until every person in this nation has access to the affordable, quality healthcare they deserve.”