Schneiderman, Cuomo launch $1B lawsuit against Trump administration

New York to sue Trump administration over $1 billion funding cut for state-run health care program

New York to sue Trump administration over $1 billion funding cut for state-run health care program

NY and Minnesota fired back in court on Friday, saying the cuts will drain more than $1 billion from programs that provide health care to 800,000 low-income residents. The attorneys general say HHS "withheld legally-required funding owed" to the states.

The two states are the only ones with Basic Health Programs, which were created under the Affordable Care Act. Another 100,000 Minnesotans would lose coverage under the action by the federal Department of Health and Human Services, the state officials said.

The BHPs, which haven't caught on in other states, are primarily funded by the federal government.

The lawsuit charges the agency and its Secretary Eric Hargan with four counts of violating the Administrative Procedures Act, a federal law mandating that agencies provide the public notice and a period to comment on changes to the programs that serve them.

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The complaint filed in the U.S. District Court for the Southern District of NY comes in response to the Trump administration's decision to withhold payments from the Basic Health Program, a provision of the Obama-era Affordable Care Act that provides subsidized insurance coverage to low-income individuals who do not qualify for Medicaid. States with a BHP receive federal funding equal to 95% of the premium tax credits and cost-sharing reductions (CSRs) that the federal government would have otherwise needed to spend if people on those plans were on an ACA exchange plan.

President Donald Trump in October ended the cost-sharing reduction payments to the Basic Health Program, known as the Essential Plan in ny and MinnesotaCare in Minnesota, arguing that the payments were illegal because Congress never appropriated the funding. "The abrupt decision to cut these vital funds is a cruel and reckless assault on New York's families and we will not allow it", New York State Attorney General Eric Schneiderman said in a statement.

"The Essential Plan is a lifeline for over 700,000 low-income New Yorkers".

"The Trump administration's action jeopardizes quality care for hundreds of thousands of vulnerable New Yorkers and goes against everything we stand for in New York", Cuomo said in a statement. In response, the states reportedly submitted proposals to HHS to restore funding, but the agency didn't respond, according to Schneiderman.

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