Obamacare Thrown Out by Judge, Raising Insurance Uncertainty


Obamacare was struck down by a Texas federal judge in a ruling that casts uncertainty on insurance coverage for millions of U.S. residents.

The decision Friday finding the Affordable Care Act unconstitutional comes at the tail end of a six-week open enrollment period for the program in 2019 and underscores a divide between Republicans who have long sought to invalidate the law and Democrats who fought to keep it in place.

The White House said the ruling will be put on hold during an appeals process that’s destined to go all the way to the U.S. Supreme Court.

U.S. District Judge Reed O’Connor in Fort Worth agreed with a coalition of Republican states led by Texas that he had to eviscerate the Affordable Care Act, the signature health-care overhaul by President Barack Obama, after Congress last year zeroed out a key provision -- the tax penalty for not complying with the requirement to buy insurance.

“Today’s ruling is an assault on 133 million Americans with preexisting conditions, on the 20 million Americans who rely on the ACA’s consumer protections for health care, and on America’s faithful progress toward affordable health care for all Americans,” California Attorney General Xavier Becerra said in a statement, leading a chorus of Democrats who blasted the decision. A spokeswoman for Becerra vowed a quick challenge to O’Connor’s ruling.

Texas Alliance
Texas and an alliance of 19 states argued to the judge that they’ve been harmed by an increase in the number of people on state-supported insurance rolls. They claimed that when Congress last year repealed the tax penalty for the so-called individual mandate, it eliminated the U.S. Supreme Court’s rationale for finding the ACA constitutional in 2012.

The Texas judge agreed. He likened the debate over which provisions of the law should stand or fail to “watching a slow game of Jenga, each party poking at a different provision to see if the ACA falls.” He also wrote that it’s clear the individual mandate is the linchpin of the law “without marching through every nook and cranny of the ACA’s 900-plus pages.”

“The court must find the individual mandate inseverable from the ACA,” he said. “To find otherwise would be to introduce an entirely new regulatory scheme never intended by Congress or signed by the president.”

President Donald Trump and Texas Attorney General Ken Paxton praised the ruling, while the American Medical Association called the decision “an unfortunate step backward for our health system.”

Some health-care law experts were quick to critique the judge’s reasoning and predicted the ruling will be overturned.

“We know what Congress’ intent was in 2017 -- that was to pull the individual mandate while keeping the rest of ACA intact,” University of Michigan law professor Nicholas Bagley said. “Now we have a judge saying we have an unenforceable mandate. This whole thing is bonkers.”

With just one day left in the sign-up period for 2019 Obamacare coverage, the judge’s ruling is unlikely to have much of an effect on those actively shopping for insurance for next year. As of Dec. 8, 4.1 million people had chosen plans through the federal-government run portal that 39 states use for enrollment.

Total enrollment is on track to be lower than in previous years, which many critics have credited to efforts by the Trump administration to promote alternatives to the law or cut back on its promotion.

California and Democratic officials in 14 states, along with the District of Columbia, won permission to defend the ACA in the Fort Worth case when the Trump administration sided with the states seeking to dismantle it. They contended that overturning the law would throw millions off health insurance rolls by reversing Medicaid expansion, ending tax credits that help people and empowering insurers to once again deny coverage based on pre-existing conditions.

Axing the Individual Mandate, Obamacare’s Hated Heart: QuickTake

Justice Department lawyers urged the judge to strike down the individual mandate and provisions requiring insurance companies to cover individuals with preexisting health conditions and charge them the same premiums as healthy individuals. They argued the judge should spare the rest of the law, which includes Medicaid expansion, the employer mandate, health exchanges, premium subsidies and federal health-care reimbursement rates for hospitals.

The judge’s ruling would, since it overturns the entire act, also end provisions that have little to do with health insurance. Those include parts of the law on adding calorie counts on restaurant menus and speeding to market cheaper versions of costly biotechnology drugs.

Maryland Attorney General Brian Frosh launched a counterattack Sept. 13 to save Obamacare, seeking a judgment that the Affordable Care Act is constitutional and a court order barring the U.S. from taking any action inconsistent with that conclusion. Frosh sued then-U.S. Attorney General Jeff Sessions and the federal departments of Justice and Health and Human Services.

The Texas case is Texas v. U.S., 4:18-cv-00167-O, U.S. District Court, Northern District of Texas (Fort Worth). Frosh’s case is State of Maryland v. United States, 1:18-cv-02849, U.S. District Court, District of Maryland (Baltimore).

www.bloomberg.com/news/articles/2018-12-15/obamacare-core-provision...

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