U.S. District Court Judge Richard J. Leon said the administration acted within its authority when it said consumers could go around the Affordable Care Act’s exchanges and retain these cheaper, barebones plans for up to three years. President Obama had limited their duration to three months.
The judge also said there was little, if any, evidence that Mr. Trump’s alternative to the 2010 program had caused major harm to the existing market.
“Not only is any potential negative impact from the 2018 rule minimal, but its benefits are undeniable,” wrote Judge Leon, an appointee of President George W. Bush.
Critics of the rules said unsuspecting customers would select “junk” plans with few protections, while sicker people who stayed in the Obamacare exchanges would pay more for robust coverage, as healthier people who’d effectively cross-subsidized their premiums dropped out of the program.
The Association for Community Affiliated Plans sued over the expansion of short-term plans, saying it undercut Obamacare-compliant plans and left sicker consumers with nowhere to turn.
Judge Leon found no tangible impact on Obamacare enrollment, however, so the administration claimed validation.
“Today’s court decision is a clear victory for American patients who saw their costs rise and choices disappear under the Affordable Care Act,” Health Secretary Alex Azar said.
House Speaker Nancy Pelosi decried the ruling, saying it belied Mr. Trump’s claim he will protect Americans with preexisting conditions.
“At every turn, the Trump Administration is working to dismantle protections for people with pre-existing conditions,” Mrs. Pelosi said. “While the GOP tries to push families into junk health insurance plans and crushing medical bills, Democrats are hard at work to protect the health care of hard-working Americans.”
Mr. Trump’s push to reshape Obamacare has run into mixed success in the courts.
A federal judge blocked attempts by Kentucky and Arkansas to apply work requirements to their Medicaid programs earlier this year, and a judge blocked the administration’s push to expand “association health plans,” dubbing it an “end run” around Obamacare.
The rule was designed to let small businesses and sole proprietors band together into “associations” and buy plans with fewer requirements than Obamacare.