Phoenix, AZ — Arizona Attorney General Kris Mayes has become part of a multistate lawsuit that contests a contentious final rule put forth by the U.S. Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS). This rule poses a risk of up to 1.8 million Americans potentially losing their health insurance coverage.
The lawsuit, spearheaded by the attorneys general from California, Massachusetts, and New Jersey, was initiated just weeks prior to the rule’s implementation date of August 25, 2025. The coalition contends that the rule breaches the Administrative Procedure Act and jeopardizes the objectives of the Affordable Care Act (ACA) by introducing new administrative hurdles that could compel millions to either forgo health coverage or confront soaring healthcare expenses.
“Arizonans didn’t vote for people who already qualify for health care to lose their health insurance,” said Attorney General Mayes. “This is yet another example of the federal administration trying to kick people off of their health insurance plans.”
“Far from delivering on their promises to drive down costs and ‘make America healthier’ the Trump Administration’s HHS and CMS are doing their best to make it harder and more expensive for Americans to obtain health insurance and access care,” said California Attorney General Rob Bonta. “These sweeping changes would impose onerous verification requirements, junk health insurance premiums for some consumers, shorten enrollment periods in federal and state healthcare exchanges like Covered California, deprive up to 1.8 million Americans of health insurance, drive up out-of-pocket healthcare costs and so much more. It’s unlawful and it’s wrong – we’re meeting the Trump Administration in court to defend Americans’ healthcare coverage.”
“At a time when Coloradans are already dealing with high costs of living, if this illegal move by the Trump administration stands, it means many people will now also be facing the prospect of paying more for doctor visits and medicine, or even losing their coverage entirely,” said Attorney General Phil Weiser. “I’ve vigorously defended the Affordable Care Act during my time as attorney general because I know how many people in our state rely on its protections to get the care they need. I will continue fighting for access to affordable health care for Coloradans.”
What the Rule Would Do
The new federal rule, developed under the Trump Administration, makes sweeping changes to how federal and state health insurance marketplaces operate. Among its most controversial provisions:
- Imposing new verification requirements for enrollment;
- Shortening the open enrollment period;
- Automatically charging consumers who were previously eligible for $0 premiums, even if they don’t actively re-enroll;
- Raising cost-sharing requirements like deductibles and copays;
- Adding bureaucratic paperwork hurdles that states say will overwhelm consumers and state health systems alike.
HHS itself estimates that the changes will strip health insurance coverage from up to 1.8 million people, while millions more could see higher premiums, deductibles, and out-of-pocket costs.
Impact on Arizona
More than 432,000 Arizonans have already enrolled in ACA plans for 2025. With open enrollment for 2026 just months away, state officials worry the federal rule could lead to confusion, widespread coverage loss, and a surge in state healthcare costs, including emergency services, uncompensated care, and expanded Medicaid expenditures.
The coalition of 21 attorneys general and Pennsylvania Governor Josh Shapiro argue that the rule is not only harmful but also legally indefensible. Their lawsuit seeks a preliminary injunction to block the rule from taking effect while the legal challenge proceeds.
According to the filing, the rule could:
- Disproportionately impact low-income families and vulnerable populations;
- Overwhelm state systems with unfunded administrative burdens;
- Undermine 15 years of progress under the ACA, which has more than doubled enrollment over the past five years to over 24 million Americans.
“For fifteen years, the Affordable Care Act has championed health care over profit in the marketplace, ensuring that no American has to ever make the impossible choice between their health and their wallet,” said Massachusetts Attorney General Andrea Joy Campbell. “The Trump Administration’s unlawful and baseless rule not only threatens to rip away coverage from millions of Americans but leaves states on the hook once again to foot the bill for this Administration’s cruel and disastrous policies.”
“Health care is a lifeline, not a privilege. This rule does exactly what the Affordable Care Act was designed to prevent: it throws up roadblocks that will push people off coverage and make care unaffordable for millions more,” said Attorney General Dan Rayfield. “Oregon has worked hard to expand access to health care, and we’re not about to let a federal rule pull the rug out from under families, especially when the administration admits it will cause up to 1.8 million people to lose their insurance.”
“The federal rule from this administration puts up barriers to accessing care that people have counted on for years, makes health insurance more expensive for consumers, and shifts financial burdens to states,” said Insurance Commissioner Patty Kuderer. “Washington state has a stable insurance market today and strong provisions in place to protect against fraud and abuse in our marketplace. The federal government should help us make health insurance more accessible and less costly for people, not more complicated and expensive to obtain.”
“In the past decade, Washington state’s uninsured rate has dropped significantly, in large part due to the availability of marketplace health insurance plans offered through Washington Health Benefit Exchange. This rule will sharply curtail that progress and reverse years of significant gains,” said Ingrid Ulrey, CEO of the Washington Health Benefit Exchange. “We estimate that this rule, combined with other federal changes, will result in enrollment loss of one-third or more of our current customer base of 280,000 Washington residents.”
Joining Arizona in this legal battle are the attorneys general from California, Massachusetts, New Jersey, Colorado, Connecticut, Delaware, Illinois, Maryland, Maine, Michigan, Minnesota, Nevada, New Mexico, New York, Oregon, Rhode Island, Vermont, Washington, and Wisconsin, along with the Commonwealth of Pennsylvania.
As enrollment increases and public dependence on ACA marketplaces expands, the states contend that the federal regulation poses a risk to the stability of the healthcare system just as it achieves its maximum effectiveness.
The case is now proceeding to federal court, where the coalition will advocate for an immediate suspension of the rule’s enforcement.
