The Trump administration approved the proposal last year.
The move to private brokers and insurers would decrease enrollment, shift consumers to junk insurance plans that provide inadequate coverage and increase premiums, the lawsuit filed Thursday in U.S. District Court in Washington says. The plaintiffs are two Atlanta-based groups — Planned Parenthood Southeast and Feminist Women's Health Center —, and the suit names the U.S. Treasury and Health and Human Services departments as defendants.
HHS declined comment.
Georgia Gov. Brian Kemp’s administration has said private websites will provide better service and offer more options that will boost insurance coverage in the state.
Critics worry the move will make it harder to shop for insurance and drive healthy people to cheaper plans that provide limited coverage, increasing insurance premiums for older and sicker people who need the comprehensive benefits required by the ACA.
The lawsuit says the plan violates the ACA, and the Trump administration failed to follow required administrative procedures before approving it. It seeks a court order invalidating the approval.
Passed in 2010, the ACA extended insurance coverage to millions of Americans by expanding Medicaid and subsidizing premiums for individuals and families who make up to four times the federal poverty level. Georgia has separately received permission for a limited Medicaid expansion.
The move away from Healthcare.gov would occur in 2023. A year before that, the state would implement another part of its ACA plan that would pay a portion of insurance companies’ costs to treat their sickest patients, a relatively small group that incurs the biggest bills. The so-called reinsurance program would allow the companies to lower monthly premiums for all customers, a particular benefit for those who don’t qualify for federal subsidies to cover premiums.
The lawsuit does not contest that part of the plan.