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ObamaCare Lawsuit

An abiding mystery of the Trump Presidency is why it can’t stand prosperity. And right on time, after its victory on Russian collusion, the Administration decided this week to elevate a legal fight over health care that it is almost sure to lose.
The Justice Department this week reversed itself to support a decision by a federal judge in Texas invalidating the Affordable Care Act. The lawsuit Texas v. Azar is brought by roughly 20 GOP state attorneys general and led by Ken Paxton of Texas. Previously the Department had supported a legal outcome that invalidated certain provisions of the law such as the mandate on pre-existing conditions.
Recall that Chief Justice John Roberts upheld ObamaCare’s individual mandate as a tax in 2012 in NFIB v. Sebelius. But Congress zeroed out the penalty as part of tax reform in 2017. The lawsuit argues that therefore the mandate is no longer a tax and is thus unconstitutional, and the rest of the law must fall with it. Voila, no more ObamaCare. Judge Reed O’Connor embraced this logic in December, and an appeal is being heard at the Fifth Circuit Court of Appeals.
One problem is that Judge O’Connor missed the mark on the question of standing, which requires an injury, and the state AGs are challenging a provision that imposes no burden on them. But even if it survives standing, the lawsuit has other infirmities that will receive a withering gaze at even the right-leaning Fifth Circuit or Supreme Court.
One legal leap is Judge O’Connor’s ruling that because the mandate is unconstitutional, then the entire Affordable Care Act has to go. The Supreme Court’s longstanding “severability” doctrine holds that courts are supposed to show restraint in cashiering entire statutes based on a single illegal provision.
Judge O’Connor is right that Democrats claimed in 2010 that the mandate is crucial to the structure of ObamaCare. But Republicans repealed the penalty in 2017, not the entire law, and ObamaCare hasn’t crashed.
Unlike in 2012, millions of people also now rely on the law for health insurance. It’s often bad insurance but it is coverage. As a legal matter, this means the Supreme Court must take into account “reliance interests” if it is going to overturn NFIB v. Sebelius. One possible, even probable, outcome is that the lawsuit ends in a cul-de-sac when the Supreme Court declines to hear the case.
As for the politics, the White House calculation seems to be that a legal decision striking down the law would force Congress to act. President Trump said on Wednesday that “if the Supreme Court rules that ObamaCare is out, we will have a plan that is far better than ObamaCare.” The GOP and Democrats can then offer Americans their competing health-care visions in 2020, and may the best plan win.
But the White House had better hope it doesn’t have that debate after millions have lost their insurance in an election year due to a court case. The GOP couldn’t agree on a plan to replace ObamaCare when it ran all of Congress, and many of the GOP Members most knowledgeable about health care have retired. If there’s some new emerging GOP consensus, we haven’t heard about it.
Mr. Trump’s impulse to go on the health-care offense has its virtues, and it beats the defensive crouch the GOP adopted in 2018 after it failed to repeal and replace ObamaCare. Democrats used the Texas lawsuit, as it happens, to claim the GOP didn’t want to insure against pre-existing conditions.
But going on offense will require more than a vague promise of something good or running against Medicare for All. Democrats might even unite around something less radioactive than single-payer. The GOP will need ideas that can persuade Americans that choice and competition will provide better plans at more affordable rates than ObamaCare.
Despite the repeal-and-replace failure, the Trump Administration has a good record on increasing consumer choice. Zeroing out the tax penalty hasn’t ushered in the end times Democrats warned about. The Centers for Medicare and Medicaid Services this week reported that ObamaCare enrollment is holding steady.
The Administration has written new rules that allow highly affordable short-term health insurance, as well as association health plans that offer group insurance across different risk pools than a single employer or the ObamaCare exchanges. The GOP can build on that base to offer a new campaign vision to take to voters. But better to do it without pursuing a legal strategy that is likely to fail and could blow up politically.

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Read MoreSource: A Losing Health-Care Strategy – WSJ

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