States looking to courts in fight against ACA
The 20 states or governors suing the U.S. in hopes of derailing the Affordable Care Act (ACA) filed a reply brief and a supplemental appendix in support of their case in the U.S. District Court for the Northern District Court of Texas last week.
The states argue that the ACA's requirement that most people have health insurance is unconstitutional because Congress ended the individual mandate penalty as part of its tax package.
With the penalty ending next year, the case alleges that the remaining parts of the health law should be moot - or, at the very least, the law should not pertain to the states involved in the lawsuit.
In its argument that the court should issue preliminary relief in the case, the plaintiffs said a “geographically-limited injunction” for just the plaintiff-states would provide “full relief from the individual mandate and the portions of the ACA that the United States concedes are not severable from the individual mandate.”
Allowing for the injunction will allow states to choose the right health insurance coverage for them, they said.
“With these federal requirements enjoined, each plaintiff-state, as regulator of its local insurance market, will be able to work with insurers to improve the mix of products on the market and promote consumer choice. This means that plaintiff-states will once again be able to provide the right mix of coverage options for their citizens, including offering protections and requirements that target the same concerns as the ACA but in more tailored ways,” they added.
The case involves 18 states, including Texas, Wisconsin and Florida, as well as two governors: Paul LePage in Maine and Phil Bryant in Mississippi.
Republican efforts to kill the ACA failed last year. Instead, the Trump administration and Republicans in Congress have been slowly wounding the law through policy changes and program cuts, using multiple tactics to chip away at the ACA's edges.
The administration cut funding for marketing and outreach for exchange plans, reduced open enrollment and stopped cost-sharing reduction payments to payers. Most recently, the administration announced it is freezing more than $10 billion in risk-adjustment payments to insurers participating in the exchanges.
President Donald Trump has also proposed expanding association health plans and short-term catastrophic plans. Critics fear expanding these plans will cause healthier people to flee the ACA marketplace. This would leave the ACA plans with an imbalanced risk pool of unhealthy people, leading to even higher premiums.
Also, ending the individual mandate penalty could lead to millions dropping or losing health insurance in the coming years. A recent joint report from the Center for Health Policy at the Brookings Institution and the USC Schaeffer Center for Health Policy & Economics warned that losing the individual mandate will reverse coverage gains.
The Congressional Budget Office predicted earlier this year that premiums will increase by 10% annually in most years without the individual mandate. The CBO also said 13 million fewer people will have health insurance over the next decade.
Meanwhile, at the state level, the 20 states or governors are hoping their case may strike the fatal blow to the ACA - and they are getting help from the Trump administration. In June, the Department of Justice declined to defend the ACA in the U.S. District Court for the Northern District of Texas, saying provisions for covering people with pre-existing conditions as well as the individual mandate are unconstitutional.