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Tuesday, 18 December 2018 11:52

The Affordable Care Act Faces yet Another Legal Obstacle

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A federal judge in Texas released his long-awaited decision last Friday in the lawsuit brought by a coalition of Republican State Attorneys General and Governors challenging the constitutionality of the Affordable Care Act. We first discussed the lawsuit here in September when the judge was hearing arguments.

In his decision, Judge Reed O’Connor stated that the individual mandate provision of the Affordable Care Act is unconstitutional as a result of the effective elimination of the penalty for not having insurance. That penalty was reduced to $0, effective in 2019, by President Trump’s 2017 Tax Cuts and Jobs Act. Judge O’Connor’s decision confirms what the Justice Department had claimed earlier this year when it sided with the Republican coalition which brought the lawsuit, stating that the individual mandate and pre-existing condition protections should be thrown out.

However, Judge Reed O’Connor went a step further and ruled that the remainder of the law is also invalid. In addition to threatening the federal and state marketplace exchanges, the Judge’s ruling throws into uncertainty other important provisions of the ACA, like the state Medicaid expansion programs, which 36 states plus Washington, DC have taken advantage of, requirements for large employers to offer affordable medical plans, and restrictions on the amount insurers can charge older individuals.

Nonetheless, the decision will likely have no immediate impact as opponents of the ruling file appeals, a process which could take many months or longer. The case has a high chance of reaching the Supreme Court sometime next year, familiar territory for the law which has been argued in front of the Justices multiple times since it was signed into law in 2010.

If you have any questions about your responsibilities under the ACA, please reach out to your Fall River Client Manager for an individualized analysis!

Read 309 times Last modified on Wednesday, 19 December 2018 11:10