At the Fifth Circuit Court of Appeals in New Orleans, lawyers from across the U.S. this week are arguing whether or not a key provision of the Affordable Care Act, also known as Obamacare, violates the Constitution. What the judges decide could dramatically alter the existing health care law — or set up a Supreme Court showdown.
The PBS NewsHour spoke with health policy experts about the latest effort by the Trump administration, and Republican lawmakers and state officials, to chip away at the Affordable Care Act.
What is Texas v. U.S.?
In February 2018, 20 Republican state attorneys general and governors sued the federal government over the ACA, arguing it was unconstitutional because the individual mandate — a central part of the law — had been eliminated by the Republican tax overhaul passed in late 2017.
The case struck at the heart of a long-running debate over the health care law’s individual mandate. Under the Affordable Care Act, if a person does not have minimal health insurance coverage, they have to pay a fine to the government. The mandate was designed to keep healthy people who may have gone without health insurance before the Affordable Care Act in the system; supporters argued that revenue from healthy, mostly younger individuals who don’t need much health care would help insurers offset the costs of insuring older, sicker patients and keep overall costs down for everyone
But Republicans opposed the mandate from the start, arguing it’s wrong for the government to punish people for not buying something they don’t want.
In their lawsuit, the Republican attorneys general and governors claim the individual mandate serves as the spine for the ACA, and without the fine, the law no longer functions.
The lawsuit was originally filed in Texas, where a lower court struck down the law last December, ruling the individual mandate was essential for the law to function. The case then moved to the Fifth Circuit Court of Appeals, where the Department of Justice made the unusual move to not defend the federal health care law because of the politics behind the ACA. But questions have persisted about whether states have the right to defend Texas v. U.S. in the federal government’s absence, which could lead appellate judges in New Orleans to throw out the case.
How did tax reform pave the way for this court case?
For months after Trump took office, the Republican-led Congress and administration fought to repeal the Affordable Care Act, but the effort failed.. During a dramatic late-night vote in July 2017, Arizona Senator John McCain voted down a bill led by his fellow Republicans to undo the law. His vote effectively saved the Affordable Care Act and earned McCain the White House’s scorn.
But then, in December 2017, Congress passed a massive tax reform package. The Tax Cuts and Jobs Act included a provision that killed the individual mandate by eliminating the fine people paid if they did not maintain health insurance that offered minimal essential coverage.
Zeroing out the individual mandate set up the legal arguments made at the lower court that the Affordable Care Act is no longer viable. Critics claim the logic is undermined by the fact that the health care law has continued to function without the mandate..
Enrollment for health insurance through the Affordable Care Act dipped during the sign-up 2019 period, which ended in December, 2018, but millions still bought their coverage under the law.
Why you should pay attention to this case
The stakes could not be greater for health care in the U.S., said Katie Keith, a researcher at Georgetown University’s Center on Health Insurance Reforms.
“If the lower court’s decision is upheld on appeal, it would upend the entire health care system,” Keith said.
If the Affordable Care Act were to be suddenly dismantled, about 21 million Americans would lose their health insurance, said Gerald Kominski, a senior fellow at the University of California-Los Angeles Center for Health Policy Research.
That includes residents of the 34 states and the District of Columbia that passed Medicaid expansion under the Affordable Care Act. People age 26 or younger would lose health insurance coverage they had under their parents. People with pre-existing conditions could be charged more for health insurance or denied coverage altogether. And Medicaid and Medicare payments to hospitals, health care providers and insurance companies would likely be ensnared in a bureaucratic nightmare.
But others said the potential impacts might not be so severe.
Thomas Miller, a senior fellow for the conservative American Enterprise Institute, said he believed the “significance of this case remains substantially overstated.”
The case won’t clear the table for a new Republican-crafted health care policy, Miller argued. He added that a more restrained approach to changing the health care law — instead of trying to undo it altogether — could have “helped bolster the case for more market-based remedial corrections, while highlighting the mistakes and misrepresentations of the law’s original architects.”
“The Trump administration’s strategic thinking, as is often the case, remains muddled, short-sighted, and volatile,” Miller said.