STATES ASSEMBLE TO SUE OBAMACARE
Earlier this week, a 20-state coalition of attorneys general (AGs) filed a lawsuit against thefederal government — specifically the IRS and HHS — over the Affordable Care Act (ACA).The claim: The ACA is no longer constitutional after the repeal of tax that enforced therequirement that people purchase health insurance policies or pay a fine — a.k.a., theindividual mandate.Plaintiffs state thatthe Supreme Court ruling from the last major Obamacare case backs uptheir argument.
Essentially, the Supreme Court only allowed the individual mandate toremain as an exercise of Congress’ taxing authority.After the passage of the new tax reform law, however, the individual mandate’s penalty wasremoved. The AGs say the entire mandate was then rendered unconstitutional, as it can nolonger be called a tax.Fundamentally, the AGs claim the individual mandate cannot be removed from the ACAwithout making the entire law unconstitutional.As Texas Attorney General Ken Paxton put it:“The U.S. Supreme Court already admitted that an individual mandate without a tax penaltyis unconstitutional.
With no remaining legitimate basis for the law, it is time that Americansare finally free from the stranglehold of Obamacare, once and for all.”Many of the states in this lawsuit may not have standing because they were involved in aprevious lawsuit that made it all the way to the Supreme Court.Under the legal process known as res judicata or collateral estoppel, the states from theprevious ACA individual mandate lawsuit would be prohibited from “relitigating” claims thatwere already litigated
For the time-being, the lawsuit now puts the ball in the Trump administration’s court, whichmust decide whether or not to defend a law it’s promised over and over again to repeal.HR pros may be thinking, “That’s a no-brainer. Trump and the GOP have been doingeverything imaginable to kill the ACA, so there’s absolutely no reason they would everdefend it.”While this is a golden opportunity for Trump to make good on a campaign promise, manyargue that it’s not that simple.
Yes, allowing the ACA to be killed offby this lawsuit would allow Trump and the GOP tomake good on a promise that was a cornerstone of their respective campaigns, but it wouldalso be a very, very messy process — a process that could ultimately do much more harmthan good, they claim.Right offthe bat, states would lose federal funding, uninsured rates would increasesignificantly and already unstable insurance markets would be immediately sent into atailspin.
And that doesn’t even account for all of the yet-unknown consequences of amarket destabilization spurred by an immediate rollback of such a massive law.Taking apart the law — and fixing it — piece by piece through planned legislation may be amore preferable path to the administration, they conclude.However, this assumes that the market is unstable, which it is not, and that the marketswon’t predict the behavior of this administration, which is extremely unlikely. Insurance ratescan be handled with a stop gap from Congress, which we already have, but are unlikely toneed, because the high rates are a byproduct of Obamacare in the first place.