A federal judge rejected a bid by Democraticstate officials to temporarily block the White House from endingso-called cost-sharing reduction payments to healthinsurers under the Affordable Care Act.

A coalition of 19 Democratic attorneys general, led byCalifornia’s Xavier Becerra and New York’s Eric Schneiderman,sought to force the federal government to continue to make thepayments that help insurance companies lower out-of-pocket costsfor poorer policyholders.

U.S. District Judge Vince Chhabria in San Francisco disagreedwith the states, saying most had time to plan for the end of cost-sharingpayments and had adjusted accordingly, so restoring the paymentscould do more harm than good.

“If the payments were restored,” Chhabria said in the Wednesdayorder, “such a remedy would likely cause millions of lower-incomepeople across the country who purchase insurance on the exchangesto be worse off than if today’s status quo is preserved.”

An appeal of Chhabria’s order is expected.

The AGs argued immediate elimination of the payments wouldinflict multimillion-dollar losses on carriers and compel them toraise premiums, potentially forcing people to forgo coverage. Theycontend the ACA requires those payments be made, even though a U.S.judge in Washington disagreed in a 2016 decision that is currently underappeal.

Bipartisan effort

Chhabria’s ruling arrives as federal lawmakerscraft bipartisanlegislationaimed at stabilizing the American health insurancemarket and continuing the CSRs for two more years. That effort,which is opposed by President Donald Trump, is being led byTennessee Republican Senator Lamar Alexander and WashingtonDemocrat Patty Murray.

The annual ACA enrollment period begins on Nov. 1. The attorneysgeneral, who in August won permission to defend the subsidies in acase before the U.S. Court of Appeals in Washington, fileda separate lawsuit on Oct. 13, after theTrump administration announced it would halt the paymentsimmediately.

“If the states are so concerned that people will be scared awayfrom the exchanges by the thought of higher premiums, perhaps theyshould stop yelling about higher premiums,” Chhabria wrote. “Withopen enrollment just days away, perhaps the states should focusinstead on communicating the message that they have devised aresponse to the CSR payment termination that will prevent harm tothe large majority of people while in fact allowing millions oflower-income people to get a better deal on health insurance in2018.”

The case is California v. Trump, 3:17-cv-05895, U.S. DistrictCourt, Northern District of California (San Francisco).

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