Experts Say Lawsuit Challenging Affordable Care Act Could Kill It

Originally published by Healio on June 25, 208. Written by Janel Miller.

Attempts to eliminate the Affordable Care Act have taken a new turn. Nearly two dozen states or their governors have filed a lawsuit against the United States government, HHS, IRS and several others claiming that Congressional action that lowered the tax on those who did not comply with the individual mandate to buy insurance voids the Affordable Care Act.

The new lawsuit, known as Texas v. the United States (2018), has some experts and medical societies concerned about its ramifications. According to AMA, the Trump administration has said it will not defend the law, and if the plaintiffs win, it could invalidate all or many components of the ACA.

Legal analysis

“Obamacare is dead if the lawsuit succeeds,” Arthur Caplan, PhD, founding head of medical ethics at the New York University School of Medicine told Healio Family Medicine.

Robert Greenwald, JD, faculty director, Center for Health Law and Policy Innovation at Harvard Law School, provided more background on the lawsuit. “The state plaintiffs and the administration have taken somewhat different positions in this case. The states are asserting that repeal of the individual mandate necessitates a repeal of the ACA in its entirety. The administration has agreed with the states, but only in so far as to assert that the guaranteed issue and community rating provisions must be overturned as a result of Congressional changes to the individual mandate. If either of these assertions prevails, then the scope of health care would change,” he said in an interview.

 

“If the state plaintiffs are successful, it would topple ACA, including provisions entirely unrelated to the individual mandate, such as the optional expansion of the Medicaid program. This would do untold damage to our health care system and leave us in a pre-ACA world where those that need health coverage the most are unable to access it,” Greenwald continued.

 

“If the administration’s arguments win the day, then the majority of the ACA will remain intact, however, the provisions that together prohibit insurers from denying coverage or imposing prohibitively high premiums on individuals living with preexisting conditions will be removed. This will return us to a time when 27% of American adults were virtually uninsurable due to insurance underwriting practices,” he said.

Not every component of the ACA is under the microscope in this lawsuit, Amanda C. Pustilnik, JD, a law professor at the University of Maryland said, adding that that the administration’s position against the ACA is “narrower than that of the states, taking aim only at the most important provisions that apply to individuals.”

“As the administration is not challenging Medicaid expansion, its position gives the lawsuit a dark silver lining,” she said in an interview. “If it succeeds, and more patients are forced into medical bankruptcy because of factors such as preexisting conditions, these patients at least may have Medicaid to fall back on. The upshot would be a huge wealth transfer. Insurance companies could shift the cost of care for the sickest patients onto taxpayers.”

The Texas v. United States lawsuit is atypical for other reasons, Pustilnik continued. “It is extraordinary—and telling—that several Department of Justice attorneys withdrew from the case before the administration filed its brief. This is very unusual. Attorneys represent clients’ positions. They don’t withdraw from a case just because they don’t like it—they withdraw when they believe it is spurious,” Pustilnik said.

Although the states involved in Texas v. the United States are led by Republican governors, and the majority of the current Supreme Court justices were appointed by Republican presidents, Caplan said that does not guarantee the Republicans will prevail if it even makes it to the highest U.S. court.

“Remember that all of [ACA] was appealed to the Supreme Court and in 5-to-4 decision, John Roberts, a Republican, cast the critical vote that decided the government had the authority to control some aspects of health care,” he said. “I don’t think the Supreme Court will overturn it, if it even makes it that far.”

Greenwald also agreed that the case will not likely make it to the Supreme Court and even if it did, would likely be another blow in a series of Republican attempts to repeal and replace ACA. “While the partisan leanings of Supreme Court justices certainly have a role to play, the arguments being advanced by the plaintiffs here are weak. So, this case is anything but a slam dunk for the Trump administration.

 

“The case turns on the question of severability: if one part of the law is found to violate the Constitution, does the entire law fail, or is the law ‘severable’ such that only the offending provisions are invalidated,” Greenwald said. “On this issue, Congressional intent is highly dispositive and if intent is not specifically clear, judicial restraint most often results in courts only invalidating the specific portion of the law that violates the Constitution as opposed to the entire legal scheme. This reinforces the principle of separation of powers—the judicial branch will avoid invalidating as much of the Congressional branch’s work as possible,” he added. Greenwald also said that this last point would mirror National Federation of Independent Business v. Sebelius (2012), where the Supreme Court ruled the constitutionality of the mandated Medicaid expansion was invalid but upheld the other provisions of the ACA.

Medical societies respond

AMA, the American Academy of Family Physicians, the American College Physicians and AAP were among the medical groups expressing dismay about Texas v. United States, filing an amicus brief citing the harm to patient health that could result from the lawsuit.

“The policies being undermined through the plaintiffs’ action have broad, bipartisan and public support, and have improved the lives of patients. An unfavorable decision in this case would create further disruption, generate uncertainty, spark additional premium increases and cause declines in coverage,” Barbara L. McAneny, MD, AMA president, said in a press release. “We urge the court to reject this case because health policy should be developed in Congress and not in the courts.”

The ACP issued its own statement saying it feared the lawsuit moves progress on federal health policy backward, not forward.

“[The lawsuit] would disregard several vital provisions of the ACA — making it harder for patients to access care and for physicians to treat them,” ACP wrote in the statement.

“The amicus brief that was submitted … aligns with ACP’s longstanding advocacy goal of ensuring that the country’s health care system protects and provides for patients rather than taking away much-needed protections and resources. ACP is ready to work with Congress and the administration to ensure that misguided health care policies are not put above the well-being of patients,” the statement continued.

Texas v. United States builds on previous attempts to repeal and replace the ACA, considered former President Barack Obama’s signature piece of legislation.

Most recently, the current presidential administration reduced funding to the Prevention and Public Health Fund as part of the budget bill passed in February. The fund was established under the ACA to provide sustained, mandatory public health funding.

Earlier this month, President Donald J. Trump issued a new health insurance rule that he said will increase opportunities for employment-based health insurance to small businesses, but experts told Healio Family Medicine the rule would undercut the minimum standards of coverage established under ACA while potentially forcing practices to navigate the bureaucracy of new health care providers.

A court date for Texas v. the United States could not be verified prior to this story’s posting by Healio Family Medicine.