US judge pauses changes to federal health insurance marketplace

(Reuters) -A federal judge paused portions of the U.S. Department of Health and Human Services' planned regulatory changes to the Affordable Care Act's health insurance marketplace on Friday, just days before they were due to take effect, a court ruling showed.

U.S. District Judge Brendan Hurson in Baltimore in his ruling sided with a challenge brought by the city of Chicago, the mayor and city council of Baltimore and public health advocates. They said the changes would result in more than 2 million people losing their health insurance coverage by increasing fees and imposing other barriers.

Hurson paused implementation of nearly all the provisions of the Marketplace Integrity and Affordability Rule the cities challenged, including some of the added fees and extra scrutiny on low-income enrollees seeking insurance. The implementation had been scheduled to go into effect on August 25.

Hurson paused implementation until he can issue a final ruling in the case.

The rule, finalized by HHS's Centers for Medicare & Medicaid Services in June, includes provisions meant to limit improper enrollments and the improper flow of federal funds, according to CMS.

In a statement, Chicago Mayor Brandon Johnson said the ruling will “help our residents obtain reasonably priced health insurance and reduce the burden on our health clinics to provide free care.”

Representatives for HHS did not immediately respond to a request for comment.

(Reporting by Diana Jones, additional reporting by Sriparna Roy in Bengaluru; editing by Caroline Humer, Franklin Paul and Leslie Adler)