It has never been easy to keep track of the Trump administration's position on the ridiculous lawsuit brought by Texas and 17 other red states to invalidate the Affordable Care Act.
But the Department of Justice's most recent position would do even more damage to the nation's health coverage market -- it would create chaos for employer-sponsored health plans.
That's the conclusion of experts at Georgetown University's Center on Health Insurance Reforms. In an analysis published online Thursday, they say the DOJ's latest brief in the case "would upend our system of employer-based coverage -- the primary source of insurance for approximately 158 million people."
Let's take a brief hike through the lawsuit and the administration's evolving position on the case. The argument by Texas and the 17 other states is that Congress effectively nullified the entire act when it reduced the law's individual mandate penalty to zero as part of the 2017 tax cut bill. Because the penalty was a linchpin of the ACA's individual market, they say, the rest of the law cannot stand.
Many experts in healthcare law, including many conservative critics of the ACA, have called this argument absurd. It would be a routine matter to sever the rest of the law from the individual penalty and leave it standing. Indeed, that's exactly what Congress did -- if it had wished to go further and invalidate the entire ACA, it could have done so, but there weren't enough votes for that. So Congress settled for eliminating the penalty and left matters there.
The Texas argument found favor with federal Judge Reed O'Connor of Texas, a conservative who in December 2018 ruled the entire ACA unconstitutional. His ruling is now before the U.S. 5th Circuit Court of Appeals, which heard oral arguments in July.
The Department of Justice originally agreed that the ACA's health plan regulations, such as protection for preexisting conditions, the requirement that premiums be largely equalized among all buyers, should be overturned. If that happened, the consequences for millions of Americans could be dire, for insurers would once again be permitted to reject or surcharge consumers based on their medical histories, placing coverage beyond their reach.
The DOJ further signaled that it would not defend the ACA in court. That left the defense in the hands of 16 blue states (including California) and the District of Columbia, who were given the authority to intervene in the federal case.
In a supplemental brief July 3, just before the appeals court heard oral arguments, the federal government shifted gears again. It argued that the whole ACA should be struck down -- but only in the 18 states that brought the lawsuit, leaving the law in place in the other 32 states and D.C.
The DOJ position may have been designed to undercut the standing of the 16 blue states to represent the ACA in court. If they're not affected by the overturning of the law, the argument goes, then they shouldn't be part of the case. But it's not so simple.