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Four Things You Need To Know About Texas v. United States Litigation

By Cheryl Fish-Parcham,

07.02.2019

On July 9, 2019, the Fifth Circuit Court of Appeals in New Orleans will hear oral arguments in the case Texas v. United States. This case threatens access to health care and financial security for millions of Americans. In December 2018, U.S. District Court Judge Reed O’Connor issued a dangerous ruling that would strike down the entire Affordable Care Act (ACA), including provisions that:

  • Protect people with preexisting conditions.
  • Improve benefits for people who buy individual coverage and those who receive coverage from their employers.
  • Reduce Medicare enrollees’ drug costs.
  • Improve the long-term financial stability of Medicare.
  • Expand Medicaid.
  • Make improvements in hospital and nursing home care.

It is that ruling that is now on appeal before the Fifth Circuit.

While the case is under appeal, it is important that consumers and their advocates know four things:

1. The ACA Is Still the Law of the Land 

The ACA continues while this case winds its way through the courts. Therefore, consumers can continue to pay premiums and obtain marketplace coverage, and people can continue to apply for and receive Medicaid benefits.

2. A Ruling that Sides with the Plaintiffs Would Harm Millions of People

The ACA is vital to patients’ access to health care. Devastating problems would reverberate throughout the health care system and the nation’s economy if the court strikes down the ACA. These are just some of the enormous harms that would result from striking the law:

  • Insurers could deny coverage or charge unaffordable premiums to older people and to people with preexisting conditions, or cancel coverage or refuse to cover care for preexisting conditions once people are enrolled. People in employer-based plans, not just individual plans, could face exclusions for preexisting conditions.
  • 20 million consumers could lose their health insurance entirely.
  • Over 12 million people would lose Medicaid coverage; 9 million would lose federal subsidies in the health insurance marketplace; and another 8 million would lose some or all of the benefits that are now covered by individual health insurance. If these people could obtain coverage at all, it would not include the benefits and protections they now receive.
  • Young people would no longer be guaranteed the right to stay on their parents’ plans until they turn 26, endangering coverage for 5.5 million young people in the near future.
  • People would no longer be guaranteed access to essential health benefits in health plans, including prescription drug coverage, maternity care, mental health and substance use benefits, and other critical services.
  • Health plans would again be able to impose annual and lifetime limits on the care they will cover for individuals and families.
  • States would lose billions of dollars in federal funds, causing job losses.
  • The public health system would lose funds to combat the opioid epidemic and other health problems.

3. The Republican Party — in the White House, Congress, and the States — Is Driving this Case 

Texas Attorney General Ken Paxton is leading a group of 17 Republican state attorneys general (Texas, Alabama, Arkansas, Arizona, Florida, Georgia, Indiana, Kansas, Louisiana, Missouri, Nebraska, North Dakota, South Carolina, South Dakota, Tennessee, Utah, and West Virginia), the governor of Mississippi, and two individual plaintiffs in challenging the ACA. These plaintiffs are urging the court to overturn the entire health care law now that the individual mandate is no longer being enforced, basing their claim on the efforts of the Republican Congress to weaken the ACA through the tax cut passed in early 2018.

What’s more, the U.S. Department of Justice (DOJ), in an unprecedented decision, is refusing to fulfill its statutory responsibility to defend federal laws when they are challenged. Instead, the DOJ argues that protections for people with preexisting conditions and all other protections in the ACA should be struck down. The Department of Health and Human Services — the federal agency named in the suit and charged with enforcing the law — and its DOJ lawyers sided with the plaintiff states instead of defending the federal law. When that happened, the senior career attorney for the case resigned in protest, and all other DOJ career attorneys withdrew their names from the filing. The DOJ’s lead attorney in the case has also withdrawn because he is leaving the agency.

California Attorney General Xavier Becerra is leading a group of 21 Democratic attorneys general who have intervened to defend the law (California, Colorado, Connecticut, the District of Columbia, Delaware, Hawaii, Iowa, Illinois, Kentucky, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, Oregon, Rhode Island, Vermont, Virginia, and Washington). The U.S. House of Representatives has also intervened to defend the law.

Families USA, along with Community Catalyst, the National Health Law Program, the Center on Budget and Policy Priorities, and the Texas-based Center for Public Policy Priorities, filed an amicus brief. Numerous patient organizations, health care providers, scholars, and individual consumers have also weighed in with declarations and as Amicus Curiae (friends of the court) to explain the importance of retaining health insurance protections for older people and those with preexisting conditions, as well as other parts of the health care law that are at risk. These include premium tax credits, Medicaid expansion, and many other health care improvements ensured by the ACA. Two Republican attorneys general, in Ohio and Montana, broke party ranks and filed another amicus brief describing the harm that would befall people with preexisting conditions if the District Court’s decision stands.

Texas is arguing that when Congress passed the Tax Cuts and Jobs Act of 2017 and set the penalty for going without coverage at $0 in 2019, it rendered the mandate unconstitutional. Texas takes the position that Congress intended the rest of the law to depend on the mandate and, therefore, that the ACA cannot stand (that is, the rest of the law is “inseverable,” says Texas). Of course, Congress itself passed the tax cut and also preserved the rest of the ACA — in notably public fashion. Nevertheless, Judge O’Connor agreed with this argument in his ruling. Virtually all legal scholars, including prominent opponents of the ACA, agree that Texas’s argument is wrong: Even if the court found the individual mandate unconstitutional, it would have to determine what Congress in 2017 intended for the rest of the law. In this instance, what Congress wanted is clear, because it kept the rest of the ACA intact when it zeroed out the penalty. In multiple high-profile votes during the current Congress, attempts to repeal the law were defeated.

4. Judge O’Connor’s Ruling Should be Overturned

So far, the District Court has decided that the entire ACA is invalid. However, Judge O’Connor has not enjoined it; this means it remains in effect while the case is being litigated. The Court of Appeals could decide any of the following:

  • The court could rule that the ACA should stand as written, and its many consumer protections must be enforced in all states; the plaintiffs have not been injured, and Congress has acted numerous time to retain the law.
  • The court could stop enforcement of parts of the ACA nationally, including its preexisting condition protections, leaving consumers who have preexisting conditions uninsured, with unaffordable premiums, or without coverage for those conditions.
  • The court could stop enforcement of the ACA or its preexisting condition protections in the 18 plaintiff states, leaving consumers in those states unprotected and making it difficult or impossible to fairly administer premium tax credits nationally.
  • The court could stop enforcement of the entire law nationally, which would throw millions of people off Medicaid and private insurance and leave them uninsured, and eliminate many other health care protections.

It’s important that people continue to raise their voices about the importance of protecting health coverage and care. This case could affect the health care of tens of millions of people. In the face of numerous threats to the ACA, Congress has repeatedly decided to preserve the law. Overturning the ACA would set up a dangerous threat to democracy.