TRENTON—More than 513,000 New Jersey residents could lose abortion access through their health insurance as Governor Mikie Sherrill faces a federal ultimatum: modify the state's insurance mandate or risk losing $1.5 billion in Medicaid funding for nursing homes and pediatric care. The Trump administration gave Interim Banking and Insurance Commissioner Justin Zimmerman until April 8 to justify the state's requirement that insurers cover abortion services, targeting New Jersey and 12 other states with similar mandates.

Sherrill’s office released a statement on Thursday criticizing the mandate. She vowed to "fight tooth and nail" against the investigation, calling it "nothing but a fishing expedition wasting taxpayers' money." Interim Commissioner Zimmerman declined to comment.

The US Department of Health and Human Services (HHS) investigation relies on the Weldon Amendment, a 2005 federal law that prohibits discrimination against health care entities that refuse to provide abortion. Acting HHS Civil Rights Director David Hyams notified Zimmerman that the agency's Office of Civil Rights (OCR) has sufficient authority and cause to investigate whether New Jersey is unlawfully coercing entities to cover abortions. In addition to New Jersey, the investigation targets California, Colorado, Delaware, Illinois, Maine, Maryland, Massachusetts, Minnesota, New York, Oregon, Vermont and Washington.

The legal dispute centers on whether the statute protects employers who purchase health plans, or only medical providers and insurers themselves. The Weldon Amendment defines protected entities as "an individual physician or other health care professional, a hospital, a provider-sponsored organization, a health maintenance organization, a health insurance plan, or any other kind of health care facility, organization or plan." Employers are not mentioned in the text.

The first Trump administration attempted to expand Weldon protections to cover employers through a 2019 regulation, but the Ninth Circuit vacated that rule in 2022, finding that it "conflict[ed] with the underlying statutes" and exceeded HHS authority under the Administrative Procedure Act. Legal experts note the current enforcement action relies on the same legal theory that federal courts already rejected.

Roger Severino drafted that 2019 rule while serving as Director of the Office for Civil Rights at HHS during the first Trump administration. In 2023, he authored the health care section of Project 2025, the Heritage Foundation blueprint for a second Trump term. The Project 2025 document specifically recommends withdrawing Medicaid funds from states requiring abortion coverage.

New Jersey receives approximately 43 percent of its Medicaid funding from Washington, totaling more than $15 billion annually. These funds support state programs like nursing home care, pediatric services and addiction treatment. A ten percent penalty, as recommended in conservative policy circles, would expose the state to $1.5 billion in potential funding loss.

The state mandate stems from New Jersey’s Freedom of Reproductive Choice Act, enacted in January 2022 under former Governor Phil Murphy. That law codified abortion as a fundamental right and directed the state's Department of Banking and Insurance (DOBI) to require coverage. The mandate applies to individual and small group plans on the state-regulated marketplace, which altogether cover more than 513,000 residents, about 5% of New Jersey’s population.

The state has joined approximately 50 federal lawsuits challenging Trump administration policies since January. Attorney General Jennifer Davenport has not indicated whether her office will lead the legal response or defer to Zimmerman and the DOBI. Legal observers expect New Jersey to seek a federal injunction blocking any funding cutoff, rather than complying with the document request.

Hyams demanded that Zimmerman produce information on the identities of all entities enforcing abortion access laws, federal funding amounts for those departments, and any pending litigation involving the mandates. The letter did not specify when OCR would complete its review or make a final funding determination.

HHS did not respond to requests for comment on what specific actions it will take if the state misses the April 8 deadline.

Sources

• U.S. Department of Health and Human Services, Office for Civil Rights. "Trump Administration Acts to Protect Conscience Rights, Expand Investigations of State Abortion Mandates" (March 19, 2026)

• New Jersey Department of Banking and Insurance. "Get Covered NJ Marks Record-Breaking 11th Open Enrollment Period." December 2024.

• The Heritage Foundation. "Mandate for Leadership: The Conservative Promise" (Project 2025) (2023)

• NorthJersey.com. "Trump targets NJ abortion mandate; Sherrill vows to 'fight tooth and nail'" (March 20, 2026)

• New Jersey Monitor. "Trump administration launches investigation of states mandating health insurance covers abortion" (March 19, 2026)

• PBS NewsHour. "Trump administration investigates 13 states over abortion insurance laws" (March 19, 2026)

• Reuters. "Trump administration investigates 13 states over abortion insurance coverage" (March 19, 2026)

• USA Today. "Trump targets 13 states' abortion insurance mandates; funds at risk" (March 19, 2026)

• NJ Herald. "NJ abortion access targeted by Trump administration" (March 20, 2026)

• Governing for Impact. "The Conscience Regulation and Weldon Amendment: Historical Enforcement Analysis" (2025)

• National Women's Law Center. "Weldon Amendment Background and Litigation History" (February 2025)