Federal Judge Strikes Down the ACA

Democrats and Republicans scramble to find a response to the ruling.

A ruling by a federal judge in Texas last Friday that invalidates the ACA roils the political waters as Democrats and Republicans search for the best response. U.S. District Judge Reed O’Connor sided with Republican attorneys general of 20 states that sought to topple Obamacare and they’ve won the first round, as the Wall Street Journal reports this morning.

Republicans are placed in the ironic position of promising to save the more popular aspects of the ACA, such as guaranteed coverage for people with pre-existing conditions, but still want to throw out the part of the law, which was passed in 2010, that says everybody must have insurance coverage. That position was summed up by GOP Sen. Susan Collins on CNN yesterday. “There is widespread support for protecting people with pre-existing conditions,” Collins said. “There’s also widespread opposition to the individual mandate.’’

Meanwhile Democratic attorneys general consider filing a lawsuit challenging O’Connor’s decision. Speaking on NBC yesterday, Democratic Sen. Chuck Schumer, said that “we have a divided House and Senate. I think the courts have to be the first and best way to go.”

The WSJ reports that “the legal staff working for Attorney General Xavier Becerra of California, one of several Democratic-led states moving to defend the health law, spent the weekend examining their legal options. They said they would challenge the decision soon.”

AHIP (aka America’s Health Insurance Plans) has come down strongly—against O’Connor’s decision. “The district court’s decision is misguided and wrong,” AHIP’s CEO Matt Eyles tells Forbes. “This decision denies coverage to more than 100 million Americans, including seniors, veterans, children, people with disabilities, hardworking Americans with low-incomes, young adults on their parents’ plans until age 26, and millions of Americans with pre-existing conditions.”

AHIP argued in an amicus brief that coverage for patients with pre-existing conditions and Medicaid and Medicare beneficiaries should remain in place.

Other heavy-hitting health care lobbying organizations have also voiced their displeasure. Barbara L. McAneny, MD, the American Medical Association’s president, tells Forbes that the decision "will destabilize health insurance coverage by rolling back federal policy to 2009. No one wants to go back to the days of 20% of the population uninsured and fewer patient protections, but this decision will move us in that direction.”

The American Hospital Association issued a statement urging “a say in this decision until a higher court can review it….” The AHA also filed an amicus brief in the case, and Rick Pollack, AHA’s president and CEO, tells Forbes that O’Conner’s ruling makes “it more difficult for hospitals and health systems to provide access to high-quality care."

The man for whom Obamacare is named isn’t wasting any time defending his arguably signature legislative accomplishment. Former President Obama posted on Facebook Saturday that we “might have heard about a federal court decision on a Republican lawsuit trying to strike down the Affordable Care Act in its entirety. That can be a scary thing to hear, particularly if you or someone you care about has a pre-existing condition. And that’s why it’s so important for you to know that last night’s ruling changes nothing for now. As this decision makes its way through the courts, which will take months, if not years, the law remains in place and will likely stay that way.”

Obama may have a point, as even his successor seems to indicate. President Trump’s comments on Saturday indicate that Trump expects that the fate of Obamacare will ultimately come down to a Supreme Court ruling. “We’ll sit down with the Democrats, if the Supreme Court upholds. We’ll be sitting down with the Democrats, and we will get great health care for our people. That’s a repeal and replace, handled a little bit differently.”

The ACA memorably came before the Supreme Court in 2012 and was saved by Chief Justice John Roberts's reasoning that the penalty for not having health insurance can be seen as a tax, and Congress has the Constitutional right to tax citizens. (That Roberts effectively rescued the ACA is another irony since Obama, as a Senator, voted against Roberts's nomination to the nations highest court.)

Last year the GOP-led Congress eliminated the individual mandate penalty.

O’Conner ruled that the elimination of the individual mandate undercut Roberts’s reasoning, and “with the tax now at $0 for 2019, the ACA can’t be upheld under Congress’s taxing power…,” the WSJ reports.

Trump administration officials have signaled that they intend to enforce the ACA for now.