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Texas court case tests whether Affordable Care Act can survive without individual mandate

Judge to decide whether loss of individual mandate is tied to keeping essential benefits for those with pre-existing conditions.

Susan Morse, Senior Editor

A Texas court case is underway that threatens the Affordable Care Act. The federal judge is weighing whether the ACA can stand without the individual mandate, which will end in January 2019 due to the tax overhaul Congress passed last year.

Texas and the 19 other Republican-led states that brought the lawsuit in February want an injunction to shut down the ACA starting in 2019.

What U.S. District Court Judge Reed O'Connor must decide is whether the individual mandate for consumers to receive essential health benefits is tied to the ACA's coverage of those who have pre-existing conditions.

Attorney General Jeff Sessions has said the Department of Justice would not defend the constitutionality of the Affordable Care Act mandate for individuals to maintain essential health benefits.  

But the Department of Justice would uphold other aspects of the ACA, he said in court documents filed earlier this year.

In Texas vs. United States, the 20 states argue that the ACA individual mandate is the core provision of the ACA and is inseparable from the rest of President Obama's signature law.

Without it, all of the ACA's regulations should be invalid, they said.

"In a move supported by congressional Republicans, the Trump Justice Department agreed with 20 Republican-led states that pre-existing condition protections should be eliminated," said Richard Neal, Ways and Means Committee Ranking Member and a Democrat from Massachusetts.

Katherine Hempstead, a senior policy advisor with the Robert Wood Johnson Foundation said, "Though unlikely, many of the potential outcomes of this case involve unwinding protections for pre-existing conditions."

The timing of the issue just before the November midterm elections could motivate voters, she said.

"Above and beyond the political fallout,  there will be profound challenges regulating a market that keeps tax credits but loses guaranteed issue and the standardization of products," she said. "That will prove quite perplexing and will likely prompt many states to regulate their markets to create some semblance of order."

America's Health Insurance Plans has argued against granting the injunction.

The 20 states that brought the lawsuit include Texas, Wisconsin, Alabama, Arkansas, Arizona, Florida, Georgia, Indiana, Kansas, Louisiana, Missouri, Nebraska, North Dakota, South Dakota, South Carolina, Tennessee, Utah, Virginia, and Gov. Paul LePage for the State of Maine and Gov. Phil Bryant for Mississippi.

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com