The Trump administration was blocked by a federal judge from screening out green card applicants who might become dependent on public benefits during the national emergency over the coronavirus.
A group of states led by New York sued the administration last year over the rule, which makes immigrants considered "public charges" if they are deemed likely to receive government benefits, including the Medicaid health care program for the poor, for more than 12 months over a three-year period. The states won a ruling last year preventing the measure from taking effect, but the Supreme Court blocked that decision and the rule went into effect in February.
On Wednesday, U.S. District Judge George Daniels in Manhattan issued an order stopping the administration from carrying it out during the pandemic, saying that the government's interest "fails to measure up to the gravity of this global pandemic that continues to threaten the lives and economic well-being of America's residents."
"No person should hesitate to seek medical care, nor should they endure punishment or penalty if they seek temporary financial aid as a result of the pandemic's impact," said Daniels, who had called the policy "repugnant to the American dream" when he first blocked it in October.
The new rule expands the definition of public charge and gives officials broad power to determine that someone is at risk of falling into that category. Critics say it upends decades of immigration policy.
"This is a major victory to protect the health of our communities across New York and the entire nation," New York Attorney General Letitia James said in a tweet.
The Department of Homeland Security and the White House didn't immediately respond to requests for comment.
