With health insurance availability for millions of Americans on the line, supporters of President Barack Obama’s signature health care law asked a federal appeals court Tuesday to conclude that the law is still valid even though Congress eliminated a tax it imposed on people who don’t buy insurance.
The arguments presented before a three-judge panel of the 5th U.S. Circuit Court of Appeals marked the latest development in a 2018 lawsuit that claims the absence of a tax converts the law into an unconstitutional directive to U.S. citizens to buy a product.
It was unclear when the three-judge panel would rule.
In December, a Texas-based federal judge agreed with the lawsuit, filed by a coalition of 18 Republican-leaning states with some backing from the Trump administration. The appeal in front of the circuit court in New Orleans was filed by a California-led group of 20 Democratic-leading states and the House of Representatives, whose attorneys faced intense and seemingly skeptical questions from two of the panel’s judges Tuesday.
Judge Jennifer Walker Elrod remarked that the law’s mandate that people buy insurance appeared intact, and Judge Kurt Engelhardt seemed to agree. Engelhardt also pointedly suggested that the question of whether each piece of the law should survive shouldn’t be answered by the judiciary but by Congress.
“This is a political solution that you … are asking the court to roll up its sleeves and get involved in,” he said.
But Douglas Letter, an attorney for the U.S. House of Representatives, argued that the elimination of the tax penalty doesn’t undermine the law’s constitutionality. And he said determining which parts of a law can be salvaged and which must be removed is clearly a task for the courts, established by Supreme Court precedent.
The ultimate outcome will affect protections for people with pre-existing conditions, Medicaid expansions covering roughly 12 million people, and subsidies that help about 10 million others afford health insurance.
The lawsuit, spearheaded by the Texas Attorney General’s Office, was filed after Congress, in 2017, zeroed out a tax the Affordable Care Act imposed on those without insurance. Republicans had tried, but failed to win full repeal of “Obamacare,” as President Donald Trump had wanted. Obama signed the health care act into law in 2010.
In challenging the law anew, “Obamacare” opponents cited the U.S. Supreme Court’s 2012 ruling upholding the legislation. In that ruling, conservative justices rejected the argument that Congress could require everyone to buy insurance under the Constitution’s interstate commerce clause. But Chief Justice John Roberts, joining four liberal justices, said Congress did have the power to impose the tax.
Among the arguments by the law’s supporters: Those who filed suit have no case because they aren’t harmed by a penalty that doesn’t exist; the reduction of the tax penalty to zero could be read as a suspension of the tax, but the tax’s legal structure still exists; and if the individual mandate is now unconstitutional, that does not affect the rest of the law.
When the law was proposed, friends and foes of “Obamacare” agreed that the tax was essential to persuade healthy people to get insured, thereby keeping premiums in check. But this year — the first time no fines will be collected — the number of people signing up for subsidized private insurance through the Affordable Care Act slipped only slightly.
The government said in March that a total of 11.4 million people signed up during open enrollment season, a dip of about 300,000 from last year.
5th U.S. Circuit Court of Appeals Judge Carolyn Dineen King asked no questions Tuesday. King was nominated to the appeals court by Democratic President Jimmy Carter in 1979. Elrod was nominated by Republican President George W. Bush in 2007. Engelhardt was nominated by Trump, a Republican, last year.
Democrats in the U.S. Senate said Monday that Republicans will pay a political price if the case results in the loss of the popular health care law.
“If they are successful in striking down the Affordable Care Act, Republicans will own all of the consequences,” Senate Democratic Leader Chuck Schumer of New York said on a call Monday with reporters.q