The Affordable Care Act is in the hot seat today. A federal court judge is set to hear oral arguments in a case that pits Republican attorneys general against a Democratic coalition over the validity of the health care reform law. Plaintiffs say the law is unconstitutional because Congress implemented a tax overhaul that eliminated the tax penalty that was part of the law's individual mandate. Democratic attorneys general disagree and argue the mandate remains constitutional. U.S. District Judge Reed O’Connor is being asked to issue a preliminary injunction that would temporarily end the law until the case is decided.
The Affordable Care Act is under fire again, this time in a Texas courtroom where a group of Republican attorneys general will argue that the health care reform law is unconstitutional.
Twenty Republican governors and state attorneys general, led by Ken Paxton of Texas, are seeking a preliminary injunction on the law until the case is decided. They filed the lawsuit in February based on the premise that the law became unconstitutional in January when Congress enacted President Donald Trump’s tax overhaul, which eliminated the tax penalty as part of the law’s individual mandate.
U.S. District Judge Reed O’Connor in Fort Worth, Texas will begin to hear oral arguments in the case, Texas v. U.S, today. If O’Connor sides with the Republican state attorneys general and temporarily ends the law, tens of millions of Americans are at risk of losing their health coverage. The result would be devastating, according to Xavier Becerra, California’s Attorney General, who will argue on behalf of a coalition of 17 other attorneys general that the mandate remains constitutional.
If the law is upended—even temporarily—it “would wreak havoc in our health care system,” Becerra told Kaiser Health News because the law also made changes to Medicare, Medicaid, and the employer insurance market. “And we don’t believe Americans are ready to see that their children are no longer able to see a doctor or that they cannot get treated for a pre-existing health condition.”
An even bigger concern: If the lawsuit is successful, the case could make its way to the Supreme Court, setting up another showdown over the Affordable Care Act. The stakes are huge: A recent Urban Institute report estimates that the number of uninsured Americans would increase by 17.1 million, or 50%, if the entire law were eliminated.
Although the case primarily falls along party lines, Kaiser Health News notes that a friend-of-the-court brief, filed by five law professors who disagree on the merits of the Affordable Care Act, argues that the GOP states are wrong to conclude that the elimination of the tax penalty should result in the death of the entire law. Congress, they noted, eliminated the individual mandate provision but left the rest of the law standing so there is no need for the courts to determine whether lawmakers intended for the rest of the law to remain in place. The lawsuit rests upon an assertion that the tax penalty provision is not separate from the other parts of the ACA legislation, and that if one provision is revoked, the entire piece of legislation is invalidated. These five scholars disagree with this notion.
Meanwhile, in the event that O’Connor sides with the Republican attorneys general, 10 Republican senators have introduced a bill to ensure the availability of coverage in the individual or group market for all Americans, including those with pre-existing conditions. But it doesn’t offer the same protections as the Affordable Care Act, notes Larry Levitt, senior vice president at the Kaiser Family Foundation.
There is a “catch,” he says, because insurers would be allowed to exclude coverage of pre-existing conditions in the plans. And in a new report on pre-existing conditions, the Kaiser Family Foundation found that in some areas of the country, nearly 4 in 10 adults would likely be denied individual insurance coverage based on pre-ACA guidelines or under the short-term plans advocated by the Trump administration.
Editor’s note: Read more on pre-existing conditions and the future of health care reform here. To learn how other plans are adapting to marketplace changes, check out our upcoming live events: RISE West, for strategies and solutions for risk adjustment, quality performance improvement and compliance; and The 12th Risk Adjustment Forum, for innovative strategies to improve risk adjustment programs for Medicare Advantage, Medicaid, and Commercial Plans.