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Saturday, April 13, 2024 | Back issues
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Imminent Fifth Circuit Ruling Could Gut Affordable Care Act

With the fate of millions of Americans’ health insurance hanging in the balance, the Fifth Circuit Court of Appeals is due to rule in a bellwether case that could gut the Affordable Care Act after Congress removed the individual mandate tax penalty two years ago.

NEW ORLEANS (CN) — With the fate of millions of Americans’ health insurance hanging in the balance, the Fifth Circuit Court of Appeals is due to rule in a bellwether case that could gut the Affordable Care Act after Congress removed the individual mandate tax penalty two years ago.

The Republican-backed challenge to the signature legislative accomplishment of President Barack Obama had been expected by Thanksgiving, but legal experts say that whatever the outcome, the case will almost certainly end up in the Supreme Court in the middle of the 2020 presidential campaign.

The dispute began in 2017 after Trump and Congress repeatedly failed to repeal the ACA through legislation. They then removed the individual mandate tax penalty when the Tax Cuts and Jobs Act was passed later that year.

Texas and 19 other Republican-led states then filed the February 2018 lawsuit Texas v. Azar in Fort Worth Federal Court, citing the U.S. Supreme Court’s 2012 ruling that the ACA’s individual coverage mandate was a valid exercise of Congressional power so long as the tax penalty exists. A group of Democratic attorneys general stepped in to defend the law, commonly known as Obamacare, after the Trump administration declined to do so.

Changes to the nation’s health care system in the past decade under the ACA are so widespread now that nearly all Americans would be affected in some way if the law is struck down in its entirety, according to an analysis from the nonpartisan Kaiser Family Foundation.

The law expanded Medicaid eligibility and preventive services, banned exclusions for pre-existing condition coverage, and imposed new requirements for employer-provided benefits. It reduced the number of uninsured Americans younger than 64 by 19.1 million people from 2010 to 2017, and provided some 60 million people with access to free preventive services, Kaiser found.

Uncertainty over the law’s future has caused at least 10 state legislatures to try to write their own health care bills to ensure people maintain some type of coverage, according to Stephanie Kennan, senior vice president of Federal Public Affairs at McGuireWoods Consulting.

“States are trying to do a lot of different strategies for a variety of reasons, some of which has to do with trying to avoid confusion, but it’s a massive undertaking for a state to try to do and not know what the parameters are,” she said.

Kennan said if the Fifth Circuit strikes down the law, it would put “an enormous amount of pressure on the states to come up with solutions,” and they may not all have the same resources.

“The ACA was a comprehensive bill in the true sense of being comprehensive, and there’s a lot that would have to be unwound, and it may takes us years to unwind it,” she said.

The case is being reviewed by a three-judge panel of the conservative-leaning Fifth Circuit: Judge Carolyn Dineen King, a Jimmy Carter appointee; Judge Kurt Engelhardt, a Donald Trump appointee; and Judge Jennifer Elrod, a George W. Bush appointee.

Judge Elrod said during oral arguments on July 9 that congressional Republicans thought “this is the silver bullet” that will undo the entire ACA.

If the Fifth Circuit rejects the legal challenge, the Trump administration can ask for a full panel review. But a decision upholding last year’s ruling by U.S. District Judge Reed O’Connor that the entire law is unconstitutional without an individual mandate tax penalty would massively disrupt the health care industry and affect how millions obtain insurance coverage.

Texas has made a habit of filing lawsuits against the federal government in O’Connor’s court. He is a member of the right-wing Federalist Society.

Whichever way the New Orleans-based circuit rules, the potential impact on consumers is not expected to be noticed right away. A ruling would likely be stayed pending appeal to the Supreme Court.

Unless the case is fast-tracked to be heard before the end of the current term, the Supreme Court would most likely hear arguments when it takes up cases for the fall 2020 term. Supreme Court terms end in June but the last two months are reserved to announce orders and opinions.

If that scenario holds, a Supreme Court decision might not be handed down until spring 2021, when the balance of power in the White House and Congress could have shifted after the 2020 election. A Democratic president and Congress could be expected to breathe life into the bill if it is defeated in the courts, while the Trump administration and a Republican Congress could continue efforts to replace it with a watered-down version, or nothing at all.

The Trump administration has not indicated how it would react if the federal health law is dismantled by the courts.

Speaking with reporters last week in the White House to announce two new rules aimed at making health care prices more transparent, President Trump said his administration is expanding affordable alternatives, “which cost up to 60% less than Obamacare plans.”

“And it could be even quite a bit higher than that, in some cases. And we will always protect patients with preexisting conditions,” Trump said.

Congressional Republicans could not agree on a replacement health care law when they tried to repeal the ACA in 2017, and Trump has not released the plan he has said is forthcoming.

The ACA’s open-enrollment period for 2020 began Nov. 1 and runs through Dec. 15.

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Categories / Appeals, Government, Health, Law

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