Is it the Beginning of the End for the Affordable Care Act?

U.S. District Judge Reed O’Connor issued a ruling last Friday on the case of Texas v. Azar, which invalidated the Affordable Care Act (ACA). President Trump has vowed to enforce the law as before, at least until the case has worked its way through the courts. However, there could be a historic shake-up on the horizon.

O’Connor reached his decision based on the individual mandate being inextricably linked to the ACA.  The Supreme Court previously upheld the law as constitutional under the taxation powers of Congress. O’Connor ruled that last year’s tax bill, which removed the penalty for not having coverage under the individual mandate, undermined the legality of the ACA. Since the law cannot be separated from the tax penalty, it is invalid.

A large coalition of Democrats are planning to appeal the ruling, including Representative Nancy Pelosi and a group of 17 attorneys general.  Some lawmakers believe that O’Connor has disregarded the Supreme Court’s “Severability” Doctrine, which orders restraint in ruling a law illegal because one part of it is. Of course, no one can say what the Fifth Circuit Court of Appeals will do when it hears the case.

Politics aside, a repeal of the ACA would have dramatic effects across the entire healthcare system. Recipients of Medicaid, Medicare, and private insurance could all be impacted along with their providers. It is unclear what will fill the gap in coverage for patients, how providers and Medicare Advantage plans will be paid, what will happen to FDA approvals of certain drugs, etc.

If Texas v. Azar makes it to the Supreme Court, arguments will most likely be heard in 2020.  For the time being, all we can do is wait.

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