The latest challenge to Obamacare was brought by more than a dozen Republican-led states that argued the law is no longer constitutional after Congress jettisoned the individual mandate penalty in the 2017 Republican tax package. The mandate was originally upheld by the Supreme Court seven years ago as a legitimate use of congressional taxing power — and without that penalty, the states argued, the entire law should fall.
Democratic-led states heading Obamacare’s legal defense said they would challenge the appeals court ruling directly to the Supreme Court, calling for a quicker resolution on the law’s fate.
“It’s time to get rid of the uncertainty,” said California Attorney General Xavier Becerra, who’s leading the Democratic defense. “In many respects, many of us believe that this is a merry-go-around. The last thing Americans need is to have their security and the health of their kids depend on these circular arguments that are going around.”
The 5th Circuit Court of Appeals said its decision to send the case back to District Court Judge Reed O’Connor was largely precipitated by the Trump administration switching legal positions in the case earlier this year. The Justice Department originally argued just the law’s individual mandate and main insurance protections should be abolished. The department, under Attorney General William Barr, earlier this year expanded its legal assault on Obamacare to argue the entire law should be found unconstitutional only in the Republican-states challenging the law.
“The rule of law demands a careful, precise explanation of whether the provisions of the ACA are affected by the unconstitutionality of the individual mandate as it exists today,” reads the 5th Circuit’s majority opinion, which was signed by the panel’s two Republican-appointed justices.
The appeals court was silent on whether it thought the law’s insurance protections should be struck down. The decision, issued hours after the latest Obamacare enrollment season ended, does not interrupt coverage for anyone covered through Obamacare’s insurance marketplaces or Medicaid expansion.
Texas Attorney General Ken Paxton, who’s leading the conservative states’ lawsuit against Obamacare, celebrated the 5th Circuit ruling.
“We look forward to the opportunity to further demonstrate that Congress made the individual mandate the centerpiece of Obamacare and the rest of the law cannot stand without it,” he said in a statement.
The 5th Circuit ruling, which comes one day before the PBS NewsHour & POLITICO Democratic Debate, will energize the already robust health care conversation in the 2020 elections. Democratic presidential candidates have sparred over ambitious plans for reaching universal coverage, from a government-run insurance option to the more sweeping “Medicare for All” plan. Republicans have bashed those ideas as “socialized medicine” that will lead to runaway taxes and rationed care.
However, renewed attention on the legal threat to the ACA could refocus Democrats on defending the law’s insurance protections for preexisting conditions. Democrats in the mid-term election pummeled Republicans over their attacks on the law, which they believe helped them take back control of the House.
“Peoples’ health care is still being jeopardized, and we have a lot of work to do to make sure the American people know with certainty their health care coverage is protected,” said freshman Rep. Lauren Underwood (D-Ill.), adding that she’d been “dreading” this kind of ruling. “They’re putting that preexisting condition coverage in the question mark zone.”
Republicans have vowed to protect individuals with preexisting conditions, but many are wary of reopening the Obamacare debate before the elections. They failed to agree on an Obamacare replacement when they had total control of the federal government two years ago, and they haven’t advanced a new plan since then, despite encouragement from Trump. A draft replacement plan from Medicare chief Seema Verma was killed this summer by Health and Human Services Secretary Alex Azar and top White House aides, who feared her blueprint would only entrench Obamacare even further.
Many legal scholars, including Obamacare opponents, have sharply criticized the latest GOP-led lawsuit as baseless. They argue courts typically avoid striking entire laws if they can stand without provisions found invalid, and Congress’s decision to zero out just the mandate penalty in 2017 is proof lawmakers meant for the rest of the ACA to stand.
The Republican chairman of the Senate health committee, Lamar Alexander of Tennessee, drove home that point Wednesday, describing the Justice Department’s argument as “far-fetched.”
“I am not aware of a single senator who said they were voting to repeal Obamacare when they voted to eliminate the individual mandate penalty,” said Alexander, a moderate who is retiring next year.
Judge Carolyn Dineen King, a President Jimmy Carter appointee, wrote in a dissenting opinion that Congress already made clear it wanted the rest of Obamacare to stand, and she criticized the majority for sending the case back to lower court.
That action “will unnecessarily prolong this litigation and the concomitant uncertainty over the future of the healthcare sector,” King wrote.
Health care groups who have navigated a host of legal challenges to Obamacare in the nearly 10 years since its enactment agreed with King’s assessment.
“Sending the decision back to the federal district court that invalidated the entire law puts health coverage — and peace of mind — for millions of Americans at risk,” said Rick Pollack, president and CEO of the American Hospital Association.
Adam Cancryn contributed to this report.