Since Congress repealed the penalty for not having insurance in its tax reform package previous year, much of the rest of the insurance statute becomes unconstitutional in 2019 and must be "struck down", attorneys for the Justice Department said in a court filing Thursday.
A group of 20 USA states sued the federal government in February, claiming the law was no longer constitutional after last year's repeal of that penalty that individuals had to pay for not having insurance.
Utah Attorney General Sean Reyes says a decision by the Department of Justice not to defend pivotal parts of the Affordable Care Act in court will strengthen the state's recently submitted lawsuit, filed with 19 other states, that argues the entire law should be struck down as unconstitutional.
The DOJ believes pre-existing conditions and the individual mandate must go hand-in-hand, claiming that part of the law is now unconstitutional. But under the GOP tax bill signed into law last December, tax penalties for people without insurance were eliminated. The guarantee that people should be able to buy insurance regardless of their health history has been a popular provision of the divisive law - one that President Trump has praised, calling the law's prohibition on denying insurance to sick people "one of the strongest assets" of the ACA in a "60 Minutes" interview before he took office. For instance, it did not go after the creation of health insurance marketplaces, premium subsidies for low-income members and Medicaid expansion.
Texas had asked the court to consider the provision of the ACA requiring individuals to have health insurance unconstitutional. In this case, California is leading a group of Democrat-led states in defending the law.
The Democrats further raised concerns that even if the Justice Department's arguments are unsuccessful, the administration's move could still "raise the cost of health care for most Americans, undermine the economy and weaken our democracy for years to come". It also says the provisions shielding people with medical conditions from being denied coverage or charged higher premiums also fall.
Many advocates spoke out against the Trump administration's stance on the law's consumer protections. That ruling hinged on the reasoning that, while the government "does not have the power to order people to buy health insurance", as Chief Justice John Roberts wrote for the majority, it "does have the power to impose a tax on those without health insurance". Legal experts are also skeptical the case will prevail and say it will take many months for a decision in the case, and the lawsuit could play out for years because of appeals.
"When Congress reformed the tax system in December 2017, it removed the tax penalty for failing to comply with the mandate", Reyes said.
Mark Showalter, chairman of the Department of Economics at BYU, contended that although protections for people with pre-existing conditions is a well-liked part of the law and the individual mandate penalty was considered deeply unpopular, the provisions are two sides of the same coin.
Reyes said Friday that "the individual mandate can not be severed" from the parts of the Affordable Care Act that prohibit insurers from increasing a person's premium rates or denying them coverage based on their health history.