Twenty states warn Trump’s H-1B fee hurts schools, hospitals
H-1B visas help US employers hire highly skilled foreign professionals for specialised roles that support innovation, growth, and essential services
More than 20 US states have moved to block the Trump administration’s newly imposed $100,000 fee on H-1B visas, warning that the policy threatens to cripple schools, hospitals, and other essential public services while cutting off a vital source of skilled global talent.
The challenge, filed on Tuesday, underscores growing concern among state governments that the unprecedented fee will have far-reaching consequences for public institutions already struggling with staffing shortages. The move carries particular weight for Indian professionals, who make up the largest share of H-1B visa holders and form the backbone of many US healthcare, education, research, and technology systems—especially within public and nonprofit institutions.
In a multistate amicus brief supporting the plaintiffs in Global Nurse Force, et al. v. Trump, the states urged the US District Court for the Northern District of California to issue a preliminary injunction blocking the fee. The brief argues the measure is unlawful, economically damaging, and fundamentally contrary to the public interest, warning it would worsen labour shortages and disrupt essential services nationwide.
He added that his office is challenging the fee to protect public institutions that depend on global talent to function effectively.
The fee was imposed on September 19, 2025, and applies to new H-1B petitions filed after September 21. Implemented through a series of Department of Homeland Security documents, the policy gives the DHS secretary broad discretion to determine which petitions are subject to the fee and which may be exempt. States argue this opens the door to arbitrary or selective enforcement, creating uncertainty for employers and workers alike.
H-1B visas allow US employers to hire highly skilled foreign nationals in specialty occupations requiring at least a bachelor’s degree. These roles include physicians, nurses, researchers, engineers, and educators—jobs that are often difficult to fill domestically. While Congress caps most private-sector H-1B visas at 65,000 annually, with an additional 20,000 reserved for advanced degree holders, many government and nonprofit research institutions are exempt from these limits so they can meet critical public service needs.
States now argue the $100,000 fee would effectively shut those public employers out of the programme. Schools, hospitals, and universities—many of which operate on fixed budgets—simply cannot absorb such a steep cost per hire, they say.
The impact on education is a major concern. The United States is facing a nationwide teacher shortage, with 74 per cent of school districts reporting difficulty filling open positions during the 2024–2025 academic year. Shortages are especially severe in special education, physical sciences, bilingual education, and foreign languages—areas where international educators have long played a crucial role.
Educators are the third-largest occupational group among H-1B holders, with nearly 30,000 teachers and academic professionals working in the US on the visas. Nearly a thousand colleges and universities rely on H-1B staff to support teaching, research, and innovation. According to the states, imposing an additional $100,000 fee per hire would lead to larger class sizes, reduced course offerings, and cuts to specialised programmes, directly affecting students and educational outcomes.
Healthcare systems face similar risks. Many hospitals, particularly in rural and underserved areas, depend on foreign-trained doctors, nurses, and medical researchers to keep services running. States warn the fee would deepen existing staffing shortages, delay patient care, and strain already overburdened health systems.
The legal challenge comes amid a broader Trump administration push to tighten legal immigration pathways, framed by officials as necessary for protecting American workers and national security. Critics, however, argue that the approach overlooks the practical realities faced by public institutions and communities that depend on skilled immigrants.
For Indian professionals—who account for a dominant share of new H-1B applicants—the outcome of the case could shape access to US public-sector jobs for years to come. Many see the lawsuit as a test of whether immigration policy can balance security concerns with economic needs and human realities.
As the court considers the request for an injunction, states maintain that the stakes extend far beyond immigration paperwork. At issue, they argue, is the ability of schools to educate, hospitals to heal, and public institutions to serve communities without losing the skilled professionals they rely on every day.