The department, in a brief it filed Thursday in a lawsuit brought by 20 state attorneys general, asks the court to halt ACA protections that Republicans in Congress sought to preserve when they attempted to repeal the health law.
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The provisions targeted by the Justice Department include the bans on insurers denying coverage and charging higher rates to people with pre-existing health conditions. The department is also seeking to roll back limits on how much insurers can charge people based on gender and age.
The decision to attack the ACA in this way involves a legal, political and policy gamble by the Trump administration, suggesting how much the president still wants to dismantle his predecessor’s signature health law after a failed ACA repeal effort by Republicans a year ago. The move could rattle the insurance markets and shake up the GOP message on health care months before the midterm elections.
Attorney General Jeff Sessions, in a letter to congressional leaders, said the department won’t defend the constitutionality of provisions in the ACA and the decision was made with the approval of President
Donald Trump.
It is highly unusual for the Justice Department not to back a federal law, though the Obama administration took a similar approach with the Defense of Marriage Act.
“Of all the things the Trump administration has done to destabilize the market, this may be the most major,” said Timothy Jost, an emeritus professor at Washington and Lee University in Lexington, Va. “What’s an insurer that is setting rates now supposed to do, because the court will not have a decision until early summer or late fall.”
The Supreme Court ruled in a landmark 2012 opinion that the health law, and specifically the requirement that Americans have health insurance, was constitutional because the penalty for not having coverage was handled by the Internal Revenue Service and fell within Congress’s taxation powers.
But Congress repealed the penalty for not having insurance last year. Republican attorneys generals are arguing in the lawsuit that the ACA and its mandate is unconstitutional now that Congress has repealed that tax-based penalty. The Justice Department agreed with that stance in its brief in asking the court to halt certain provisions of the ACA.
That case, filed in federal district court in the Northern District of Texas, focuses on the individual mandate, which is the ACA’s requirement that most people have health coverage or pay a penalty. Congressional Republicans late last year ended the penalty starting in 2019, but the requirement to have insurance technically remains. It is unenforceable without a penalty, however.
The Justice Department, in its brief, said certain ACA provisions, such as banning insurers from denying coverage to people with pre-existing conditions, are invalid as of Jan. 1 with the mandate-penalty repeal. The U.S. agreed with the plaintiffs that sections “must now be struck down as unconstitutional,” according to the Justice Department brief.
Mr. Sessions, in the letter to congressional leaders, said: “The department in the past has declined to defend a statute in cases in which the president has concluded that the statute is unconstitutional and made manifest that it should not be defended, as is the case here.”
Democrats quickly decried the move as an improper action likely to harm numerous Americans, especially those who are older and less healthy.
“Tonight, the Trump Administration took its cynical sabotage campaign of Americans’ health care to a stunning new low,” House Minority Leader
Nancy Pelosi
said in a statement. “Once again, Republicans are trying to destroy protections for Americans with pre-existing conditions.”
Sixteen states and the District of Columbia sought to intervene in the case to defend the ACA. The court has granted their request.
The move is likely to rattle insurers who are now setting rates for 2019 based on the belief that they must abide by the ACA consumer-protection requirements. Some legal and health experts said the administration’s decision could destabilize markets.
The department didn’t say other aspects of the ACA, such as its expansion of Medicaid and its exchanges, should be halted.
University of Michigan law professor Nicholas Bagley said three Justice Department attorneys withdrew their names from the brief.
“For the administration to cast aside the ACA in a brazen political move, I’m afraid,” he said. “We don’t want the DOJ to take frivolous arguments and make it into law killers.”
For insurers, the Trump administration stance changes nothing immediately, but raises the likelihood of yet another year of far-reaching uncertainty in the ACA markets. As with other significant legal changes and threats to the ACA over the years, the court proceeding will leave insurers and, particularly, state insurance regulators in the hot seat, unsure how to proceed with decisions on pricing and plan designs.
Insurers are currently filing their rates and plans for the 2019 ACA marketplaces, based on the current rules, which require them to sell plans to all applicants and ban them from tying premiums to consumers’ health conditions. State regulators have begun reviewing the proposed rates, which are set to be completed over the next few months.
Now, insurers and state regulators will have to consider the possibility that insurers will be allowed to go back to pricing plans based on health conditions, a change that would in many ways turn back the clock to how individual coverage was sold before the ACA. It would strike down the central assumptions undergirding the filings the insurers are currently making.
—Anna Wilde Mathews and Jess Bravin contributed to this article.
Write to Stephanie Armour at stephanie.armour@wsj.com
Article source: https://www.wsj.com/articles/justice-department-wont-defend-affordable-care-act-in-lawsuit-brought-by-states-1528419363