Dear Members,
Below please find an update on the recent court ruling on the Affordable Care Act (ACA) from our federal lobbyist, Hans Rickhoff, with Akin Gump:
On Friday, December 14, 2018, a federal district judge ruled that the individual mandate included in the Affordable Care Act (ACA) is unconstitutional, because Congress repealed the penalty provisions as part of last year’s tax reform bill. Judge Reed O’Connor of the U.S. District Court for the Northern District of Texas further concluded that the individual mandate cannot be severed from the rest of the ACA; therefore, the entire law is invalid. Since the judge issued a declaratory ruling rather than an injunction against enforcement of the ACA, however, the current law remains in effect while the decision is being appealed.
The White House confirmed that the ACA will remain in place while the ruling is challenged, and the Centers for Medicare and Medicaid Services (CMS) noted that it will continue to implement the law – specifically stating in a release that the work of the Innovation Center will not be affected. The appeal to the conservative-leaning Fifth Circuit Court of Appeals will be led by California Attorney General Xavier Becerra and several other Democratic Attorneys General.
The case ultimately could make its way to the U.S. Supreme Court. The Court’s rulings often favor severability, which holds that when a portion of a law is found unconstitutional, the rest of the law should be preserved. Notably, the Supreme Court’s 2012 ruling on the ACA – which preserved the individual mandate while striking down a provision requiring states to expand Medicaid – implied that the law was severable.
The outlook for legislative action in Congress is unclear at present. The President was quick to declare victory on Friday night, calling the ACA an “unconstitutional disaster” and calling for Congress to pass a new health care law to replace it. Senate Minority Leader Chuck Schumer (D-NY), meanwhile, said the ruling was “based on faulty legal reasoning,” while House Minority Leader Nancy Pelosi (D-CA) called the district court’s “absurd ruling” an “assault on people with pre-existing conditions and Americans’ access to affordable health care.”
Incoming Senate Finance Committee Chairman Charles Grassley (R-IA) committed to holding hearings on what he called the “fatally flawed” ACA. House Ways and Means Chairman Kevin Brady (R-TX) and House Energy and Commerce Committee Chairman Greg Walden (R-OR) expressed support for preserving the ACA’s pre-existing condition protections and urged action on bipartisan health care reform legislation.
Please contact TAHC&H if you have any questions about this update.
Thank you!
Heather