WASHINGTON—The Trump administration on Saturday confirmed it is suspending billions of dollars in payments expected by insurers under the Affordable Care Act, saying the halt is necessary because of a federal judge’s ruling in a lawsuit over the program.

The ruling prevents the Centers for Medicare and Medicaid Services, which administers the program known as risk adjustment, from making further collections or payments, including amounts for the 2017 benefit year, until the litigation is resolved, the agency said.

The...