19 US states sue Trump over $100,000 H-1B fee: Why immigrants matter

US states warn the steep fee could choke healthcare, education and other essential services that rely heavily on H-1B professionals

Nineteen US states have taken the Trump administration to court over its decision to impose a $100,000 fee on new H-1B visa petitions, calling the move unlawful and procedurally flawed.

 

New York Attorney General Letitia James, joined by 18 other attorneys general, filed the lawsuit on Friday in the US District Court for the District of Massachusetts. The challenge centres on what the states describe as a sharp increase in H-1B fees imposed without legal authority or due process.

 

The H-1B visa programme allows highly skilled foreign professionals to work temporarily in the US and is widely used by Indian nationals. In September, US President Donald Trump announced a one-time $100,000 charge on all new H-1B applications.

 

 

What is the case against the H-1B fee hike?

 

The states argue that the new fee would make the programme effectively inaccessible for government bodies and non-profit employers that depend on H-1B workers to deliver essential services in healthcare, education, technology, and other fields.

 

“H-1B visas allow talented doctors, nurses, teachers, and other workers to serve communities in need across our country,” James said.

 

“The administration’s illegal attempt to ruin this programme will make it harder for New Yorkers to get health care, disrupt our children’s education, and hurt our economy. I will keep fighting to stop this chaos and cruelty targeting immigrant communities,” she said.

 

The coalition said the fee would sharply limit states’ ability to recruit workers through the H-1B route to address labour shortages, disrupting access to education, healthcare, and other critical services.

 

It warned that rural and underserved communities, already facing shrinking workforces, would be hit hardest.

 

How would healthcare and education systems be affected?

 

In New York, more than a third of healthcare workers are immigrants, while public universities and hospitals rely heavily on H-1B professionals, according to the lawsuit.

 

In the state’s 16 rural counties, there are four primary care physicians for every 10,000 people. Hospitals across New York already face a nursing shortfall expected to reach 40,000 nurses by 2030. The lawsuit argues that a fall in H-1B numbers would deepen this gap.

 

Nationwide, the American Medical Association estimates a shortfall of 86,000 physicians by 2036, a gap that H-1B workers play a key role in filling.

 

Across the US, at least 930 colleges and universities employ staff on H-1B visas. More than half are public four-year institutions, and over 10 per cent are medical schools.

 

In New York alone, the State University of New York employs 693 H-1B visa holders, many of whom work with students in rural and suburban areas.

 

The states argue that limiting access to the visa would lead to larger class sizes and disrupt research activity at major universities.

 

Does the impact extend beyond campuses and hospitals?

 

Other sectors in New York, including technology, finance, and the arts, also rely on H-1B professionals. More than 13,000 people on H-1B visas work across these industries in the state.

 

California Attorney General Rob Bonta said the $100,000 fee would create “unnecessary” and “illegal” financial burdens for public employers and providers of essential services.

 

Why is the legality of the fee under scrutiny?

 

The attorneys general argue that the fee violates both the Administrative Procedure Act and the Immigration and Nationality Act, as it was imposed without congressional approval or the required rule-making process.

 

Joining James in the lawsuit are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Massachusetts, Michigan, Minnesota, North Carolina, New Jersey, Oregon, Rhode Island, Vermont, Washington, and Wisconsin.

 

“The Trump administration thinks it can raise costs on a whim, but the law says otherwise. We are going to court to defend California’s residents and their access to the world-class universities, schools, and hospitals that make Californians proud to call this state home,” Bonta said.

 

Why does the H-1B programme matter?

 

The US has operated a skilled worker visa system since the 1950s. The modern H-1B programme, created in the 1990s, allows employers to hire workers in a speciality occupation for up to six years.

 

India is the largest source of international medical graduates in the US, who are commonly on H-1B visas, accounting for about 22 per cent of all international doctors. With international doctors making up roughly a quarter of US physicians, Indian H-1B holders are estimated to represent around 5–6 per cent of the total workforce.

 

Indians account for about 70 per cent of H-1B recipients. However, only three of the top ten H-1B employers had ties to India in 2023, down from six in 2016, according to Pew Research.

 

H-1B visa holders and their families contribute an estimated $86bn a year to the US economy, including $24bn in federal payroll taxes and $11bn in state and local taxes.