A federal judge has ruled that part of the Affordable Care Act is unconstitutional because it appropriates funds not approved by Congress.
The politically-divided case is expected to be appealed and a final decision may be handed down after the election of the next president.
If the ruling stands, insurers could be unwilling to continue to provide lower-cost coverage through the ACA marketplace.
On Thursday, U.S. District Court, District of Columbia Judge Rosemary Collyer granted a summary judgement to the House of Representatives in the case against Health and Human Services Secretary Sylvia Burwell.
The department has spent billions over the last two years in money not appropriated by Congress, to make health insurance more affordable through reductions in deductibles, co-pays, coinsurance and other cost-sharing measures borne by insurers, Collyer said.
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Insurers are to get that money back, in an ACA provision Section 1402 that requires insurers to offer the cost-sharing reductions.
"The Affordable Care Act unambiguously appropriates money for Section 1401 premium tax credits but not for Section 1402 reimbursements to insurers," Collyer said. "Such an appropriation cannot be inferred."
Health and Human Services argued that the two sections were economically and programmatically integrated.
The judge disagreed, and said Congress refused to appropriate the money.
"Congress authorized reduced cost sharing but did not appropriate monies for it, in the FY 2014 budget or since," she said.
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Congress estimated the combined expenditures for Sections 1401 and 1402 cost $500 billion, according to the ruling.
Another estimate is Sections 1401 and 1402 cost $5 billion a year, according to a Supreme Court of the United States blog.
Collyer's ruling is stayed pending an expected appeal to a federal court of appeals or directly to the Supreme Court.
The lawsuit is the latest in federal court challenges to Obama's signature healthcare law.
Earlier, the administration tried to have the case dismissed saying the House had no right to sue on the premise it would not suffer injury for how the government made spending decisions under the ACA, according to the SCOTUS blog. Collyer upheld the right of the House to sue.
Twitter: @SusanJMorse