These plans are overwhelmingly opposed by consumer and patient advocates and others, who have warned that they will drive up costs for sicker consumers who need more comprehensive health coverage.
A medical doctor, right, examines a patient at a CCI Health and Wellness Services health centre in Gaithersburg, Maryland, US, on Tuesday, April 18, 2017.
Trump and fellow Republicans in Congress have sought to dismantle Obamacare, which sought to expand insurance coverage to more Americans.
The issue became a flash point that helped derail Republican efforts to repeal the law previous year, with opponents of the party's health bills speaking loudly against weakening protections for the sick and vulnerable. The guarantee that people should be able to buy insurance regardless of their health history has been a popular provision of the divisive law - one that President Trump has praised, calling the law's prohibition on denying insurance to sick people "one of the strongest assets" of the Affordable Care Act in a "60 Minutes" interview before he took office.
"You've got very sympathetic populations that are affected by those conditions so to somehow adversely affect them is not a politically wise move", said Representative Tom Reed, a New York Republican, signaling opposition to the administration's decision.
Senate Democrats have vowed to make health care policy a priority this summer, as they gear up for midterm elections this November.
In a letter to House Speaker Paul Ryan explaining the administration's decision, U.S. Attorney General Jeff Sessions cited the Justice Department's "longstanding tradition" of defending the constitutionality of federal laws "if reasonable arguments can be made in their defense".
Asked about the Justice Department move, Jesse Hunt, a spokesman for the National Republican Congressional Committee, spoke instead about the Democrats.
Insurers are now in the midst of deciding whether to participate in the individual marketplaces created under the law in 2019 and, if so, what filing rates with state regulators will be.
Recent polling indicates that this could be a political victor for Democrats attempting to recapture at least one chamber of Congress. "No family should have to go through that and worrying how to pay for it all".
Texas and the accompanying states have asked for a preliminary injunction that could suspend the entire law while the case plays out in court.
Linda Muller, president and CEO of Cornerstone Healthcare, the mid-Hudson's largest low-income health provider, said it would be disastrous if "an entire class of individuals with pre-existing conditions are targeted" by a federal decision not to support them.
The major difference is that the justice department, under Donald Trump, has largely switched sides.
This is not the first move the Trump administration has taken that would undermine Obamacare's consumer protections.
The Trump administration Thursday did not go that far. Allowing the Democratic officials to join the suit "allows us to protect the health and well-being of these Americans by defending affordable access to health care".
California Attorney General Xavier Becerra pledged Friday to redouble his efforts as the Affordable Care Act's leading defender, saying attacks by the Trump Administration threaten health care for millions of Americans.
But Justice Department lawyers do argue that with no penalty for not having coverage, the federal government can not make health insurers cover sick consumers or prohibit insurers from charging sick consumers higher premiums, as was routinely done before the health care law was implemented.
It will likely take years for the case to wend its way through the courts, meaning the uncertainty could linger over insurers for some time, according to Spencer Perlman, an analyst at Veda Partners.
What are the ramifications of the Trump administration making these arguments?
"Insurance companies hate uncertainty, and when they face uncertainty, they tend to increase premiums and hedge their bets", said Larry Levitt of the nonpartisan Kaiser Family Foundation. "At the worst it could strip away guaranteed coverage for those with pre-existing conditions".
Jonathan Adler, a law professor at Case Western Reserve University and an architect of a lawsuit that came within two Supreme Court votes of gravely damaging the ACA in 2014, said the current legal effort supported by the administration probably won't succeed.
"It's just one more part of the story of trying to politicize the Justice Department", said Jost, a supporter of the health law. And because a scant majority of the Supreme Court had said it was Congress's taxing powers that saved the ACA from being unconstitutional, that protection was no longer there. "This is why the states' arguments about severability (and that accepted by DOJ) is wrong".