A federal judge in Texas on Friday ruled the entire Affordable Care Act is unconstitutional due to a recent change in federal tax law. The move, coming on the eve of the deadline to sign up for coverage for 2019, leaves 20 million Americans' health coverage in limbo.
At issue in the case is the individual mandate, which requires people to have health insurance. The penalty for not having insurance was dropped to $0 in the most recent tax legislation, potentially undercutting the Supreme Court's decision in 2012 that the Affordable Care Act was constitutional because of Congress' ability to tax.
With no penalty, there's no tax, the plaintiffs, a coalition of Republican-led states, argued in the Texas case. A coalition of states governed by Democrats and led by California had a different interpretation -- that the individual mandate isn't unconstitutional if people aren't actually being forced to pay penalties. California also argued that the individual mandate could be severed from the rest of the health care law.
U.S. District Judge Reed O'Connor sided with the GOP plaintiffs. "The Court therefore finds the Individual Mandate, unmoored from a tax, is unconstitutional," his ruling read.
The plaintiffs also argued that the individual mandate is so essential to the entire law, so that if it's unconstitutional, the rest of the law must also be thrown out. Judge O'Connor agreed on that point, too. The case now will likely go to the Supreme Court. If it goes to the Supreme Court, the five justices who voted to uphold the ACA still sit on the Supreme Court.
Until that happens, the law will remain in place, the White House said after the decision. "We expect this ruling will be appealed to the Supreme Court. Pending the appeal process, the law remains in place," White House press secretary Sarah Sanders said in a statement.
President Trump applauded the decision on Twitter Friday night, writing that he had "predicted all along" that the Affordable Care Act is unconstitutional. "Now Congress must pass a STRONG law that provides GREAT healthcare and protects pre-existing conditions. Mitch and Nancy, get it done!" Mr. Trump wrote.
Should the health care law be found unconstitutional by the Supreme Court, those 20 million people buying health insurance on the individual market would almost certainly see ACA protections go away, including the following:
- Insurers would not be required to cover pre-existing conditions;
- Insurers would no longer be required to insure children on their parents' policies up to the age of 26;
- There would be no cap on out-of-pocket medical expenses;
- Coverage limits, both annual and lifetime, could be included in health insurance.
Texas Attorney General Ken Paxton, one of the plaintiffs, applauded the ruling in a statement. "Our lawsuit seeks to effectively repeal Obamacare, which will give President Trump and Congress the opportunity to replace the failed social experiment with a plan that ensures Texans and all Americans will again have greater choice about what health coverage they need and who will be their doctor," Paxton said.
California Attorney General Xavier Becerra, one of the defending attorneys general, called the ruling an "assault on 133 million Americans with preexisting conditions." His spokesperson said they plan to appeal.
U.S. Rep. Nancy Pelosi, who will become the Speaker of the House in January, said the ruling "exposes the monstrous endgame of Republicans' all-out assault on people with pre-existing conditions and Americans' access to affordable health care."