January 8, 2019

Justice Department appeals ruling striking down ACA—and now the House may intervene, too

Daily Briefing

    The Department of Justice (DOJ) on Friday filed a motion to appeal a federal judge's ruling striking down the Affordable Care Act (ACA).

    Just updated: Your cheat sheets for understanding health care's legal landscape

    Lawsuit details

    The Supreme Court in 2012 upheld the ACA's individual mandate, ruling that although Congress could not force U.S. residents to purchase insurance, lawmakers could impose a tax penalty on individuals who did not enroll in health coverage.

    But a group of 20 Republican-led states, led by Texas Attorney General (AG) Ken Paxton (R) and Wisconsin AG Brad Schimel (R), in February filed a lawsuit in the U.S. District Court in the Northern District of Texas, in which they noted that a 2017 tax reform law eliminated the individual mandate's tax penalty starting in 2019 by setting the penalty U.S. residents must pay for remaining uninsured under the ACA at $0. The AGs in the suit argued that by zeroing out the tax penalty, the tax reform law has rendered the individual mandate, and by extension the entire health reform law, unconstitutional.

    The Department of Justice (DOJ), which has declined to defend the ACA in the suit, in a brief largely agreed with the 20 states challenging the ACA's constitutionality, saying the individual mandate will no longer be constitutional once the tax penalty is eliminated in 2019. But unlike the GOP states, DOJ said such a ruling should not invalidate the entire law.

    Instead, DOJ argued a ruling invalidating the ACA's individual mandate should only affect some of the ACA's consumer insurance protections, such as the ACA's ban on insurers denying people health coverage or charging them higher premium rates based on pre-existing medical conditions, as well as limits on how much insurers can charge people based on gender and age.

    U.S. District Judge Reed O'Connor last month in a declaratory judgement ruled that eliminating the individual mandate's tax penalty made the mandate unconstitutional. He also ruled that the ACA cannot be severed from the mandate, meaning the entire ACA must be struck down because the individual mandate is unconstitutional. O'Connor wrote in his ruling, "[T]he individual mandate 'is so interwoven with [the ACA's] regulations that they cannot be separated. None of them can stand.'"

    Democratic AGs from 18 states and the District of Columbia on Thursday appealed O'Connor's ruling to the 5th U.S. Circuit Court of Appeals.

    DOJ appeals O'Connor's ruling

    DOJ on Friday filed a motion that it, too, will appeal O'Connor's ruling. According to Inside Health Policy, DOJ has agreed that the individual mandate should be ruled unconstitutional, but the department has argued the individual mandate can be severed from the rest of the ACA.

    House seeks permission to intervene in case

    Also on Friday, lawyers for the House announced that they have filed a court motion requesting permission for the House to intervene in the lawsuit.

    The motion argued that the House "has a unique institutional interest in participating in this litigation to defend the [ACA] against the remaining challenges, and intervention should be granted." It stated, "The House disagrees with the [GOP states'] position, which (if enforced) would erase in significant part the statute that Congress enacted, and the House is prepared to argue against this position in any relevant additional proceedings in this court and on appeal."

    The move came after the House on the Thursday adopted a standalone resolution authorizing the House's counsel to defend the ACA in the case. The House is expected to vote this week on the whether to approve the resolution. However, The Hill reports that the move is largely a formality and is intended to force Republicans to go on record either for or against the measure.

    According to Inside Health Policy, DOJ has asked the court to delay any briefings on whether the House may intevene in the case because of a partial government shutdown. DOJ said it opposes the House's effort, but that it will not be able to respond by a Jan. 24 deadline because of the shutdown (Lotven [1], Inside Health Policy, 1/7 [subscription required]; McIntire, Roll Call, 1/4; Weixel, The Hill, 1/4 Lotven [2], Inside Health Policy, 1/7 [subscription required]).

    Cheat sheet: What you need to know about the ACA

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    The Patient Protection and Affordable Care Act, otherwise known as the ACA, is the comprehensive health care reform bill passed by Congress in March, 2010. The law reshapes the way health care is delivered and financed by transitioning providers from a volume-based fee-for-service system toward value-based care.

    Download the ACA cheat sheet to get a quick overview of this significant U.S. health care legislation.

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