The Trump administration delivered an early midterms present to Democrats Thursday night when the Justice Department made a decision to side with 20 GOP states in a lawsuit seeking to gut the core protections of the Affordable Care Act for people with pre-existing conditions.
The Justice Department said that also nullifies two other major provisions of Obamacare linked to the individual mandate, including one barring insurance companies from denying coverage to people with pre-existing conditions.
In a brief filed in a federal court in Texas, the department said a tax law signed past year by President Donald Trump that eliminated penalties for not having health insurance rendered the so-called individual mandate under Obamacare unconstitutional.
A coalition of 20 USA states sued the federal government in February, claiming the law was no longer constitutional after last year's repeal of the penalty that individuals had to pay for not having insurance.
The administration says it agrees with Texas that the so-called individual mandate will be unconstitutional without the fine.
Three attorneys for the government withdrew from the case just minutes before the Justice Department's filing in federal court in Fort Worth, Texas, which signaled an internal rift within the administration over its role in defending USA law, according to University of Michigan Law Professor Nicholas Bagley.
But it says the rest of the law, including Medicaid expansion, can remain in place.
In many ways, the lawsuit, filed in February, is a replay of the politically divided litigation that ended with the Supreme Court upholding the health care overhaul in 2012. "But even if the Justice Department's arguments fail, as they should, the administration's violation of its duty to faithfully execute our nation's laws will still raise the cost of health care for most Americans, undermine the economy, and weaken our democracy for years to come". In addition, the government doesn't go so far as Texas and its fellow plaintiffs in arguing that the Affordable Care Act and the regulations issued under it are now invalid.
"The individual mandate thus still exists, but it will no longer be fairly possible to describe it as a tax because it will no longer generate any revenue", the Justice Department said in its brief on Thursday.
Insurers are now finalizing their premium requests for 2019, and Jost said the Justice Department filing may prompt jittery carriers to seek higher rates.