Trump Backs ACA Elimination

April 3, 2019

The Trump administration has reversed its stance on the Affordable Care Act (ACA), arguing in a court filing on March 25 that the entire law should be eliminated instead of just removing provisions protecting people with preexisting conditions. Further, President Donald Trump signaled on April 1 that he will not press for a vote on a bill to replace the ACA until after next year’s elections.

In December 2018, a federal district judge in Texas ruled that the individual mandate in the ACA, which requires people to buy health insurance or face a penalty, is unconstitutional. Judge Reed O’Connor then stated that the entire law is unconstitutional. Many health policy experts believed the ruling was mere political maneuvering. However, instead, the Trump administration tightened its stranglehold on March 25. The Justice Department, which typically defends the law of the land, said it cared nothing about defending this law. In a two-sentence letter, the Justice Department said it would not urge “that any portion of the district court’s judgment be reversed.”

The move came hours after Democratic attorneys general defending the ACA filed their brief arguing that the landmark law is still constitutional even without an effective individual mandate penalty. Both filings are in the Fifth Circuit following the appeal of Judge O’Connor’s decision from December declaring the law unconstitutional after Congress set the mandate penalty to zero in tax overhaul legislation. That decision was stayed pending appeal.

Specifically, seventeen Democratic state attorneys general filed a notice of appeal in response to the judge’s ruling that the ACA is unconstitutional without its individual mandate penalty. With a stay on Texas Judge Reed O’Connor’s decision, the law remains in effect and the appeals process now awaits further direction from the Court of Appeals for the Fifth Circuit. The coalition, led by California Attorney General Xavier Becerra, is arguing that O’Connor’s decision is erroneous and “wrong-headed,” Becerra said. Dismantling the ACA, he added, would be detrimental to the health of millions of Americans who are insured under the law, as well as economic growth and trust in government.

The Justice Department’s letter won’t change anything yet for the ACA law. Coverage for those who have insurance through the ACA — more than 10 million people through Medicaid expansion, and nearly 12 million more through ACA exchanges — stays the same for now. The case will continue to wind through the courts and is likely to end up before the Supreme Court. If the case does land at the Supreme Court, it would be the third time that the court would rule on a constitutional question related to the ACA. The court upheld the law in 2012 and rejected a challenge to it in 2015.

NSBA has long believed the small-business community needs substantial relief from health care costs and many of the burdens imposed by the ACA. NSBA has shared with lawmakers that this level of relief can only be achieved through a broad reform of the current health care system with a goal of reducing the cost of coverage, providing universal access, focusing on individual responsibility and empowerment, creating of the right market-based incentives, and a relentless focus on improving quality while driving out unnecessary, wasteful and harmful care.

Under the ACA, according to NSBA survey data, 69 percent of small firms experienced premium increases exceeding 20 percent. And while costs are a huge headache, so is the law’s complexity– it takes the average small-business owner 13 hours per month to stay abreast of all the changes under ACA – that’s nearly four work weeks every year.

The lynchpins to successful health care reform are: affordability, universal access, individual responsibility, proper market-based incentives, improved quality and eliminating wasteful care. NSBA has also called on lawmakers to take a serious look at the drivers of health care costs: rewarding procedures instead of outcomes; hidden pricing structures; electronic records that fail to properly transport and communicate for the patient; and rampant defensive medicine.