Federal judge in Texas rules Obama health-care law unconstitutional

A federal judge in Texas threw a dagger into the Affordable Care Act, ruling that the entire health-care law is unconstitutional because of a recent change in federal tax law.
A federal judge in Texas threw a dagger into the Affordable Care Act on Friday, ruling that the entire health-care law is unconstitutional because of a recent change in federal tax law. [Associated Press]
A federal judge in Texas threw a dagger into the Affordable Care Act on Friday, ruling that the entire health-care law is unconstitutional because of a recent change in federal tax law. [Associated Press]
Published December 15 2018

A federal judge in Texas threw a dagger into the Affordable Care Act on Friday, ruling that the entire health-care law is unconstitutional because of a recent change in federal tax law.

The opinion by U.S. District Judge Reed O'Connor overturns all of the sprawling law nationwide.

The ruling came on the eve of the deadline for Americans to sign up for coverage in the federal insurance exchange created under the law.

Since the suit was filed in January, many health-law specialists have viewed its logic as weak but nevertheless have regarded the case as the greatest looming legal threat to the 2010 law, which has been a GOP whipping post ever since and assailed repeatedly in the courts.

A spokeswoman for California Attorney General Xavier Becerra, D, who leads a group of states opposing the lawsuit, said that the Democratic defenders of the law are ready to challenge the ruling in the U.S. Court of Appeals for the 5th Circuit.

The Supreme Court upheld the law as constitutional in 2012 and 2015, though the first of those opinions struck down the ACA's provision that was to expand Medicaid nationwide, letting each state choose instead. No matter how O'Connor ruled, legal experts have been forecasting that the Texas case would be appealed and could well place the law again before the high court, giving its conservative newest member, Justice Brett Kavanaugh, a first opportunity to take part.

O'Connor is a conservative judge on the U.S. District Court for the Northern District of Texas. He was appointed by President George W. Bush. O'Connor ruled once before on an issue arising from the ACA, issuing a nationwide injunction two years ago on an Obama administration rule that forbade health-care providers to discriminate based on gender identity.

And in June, the administration took the unusual step of telling the court that it will not defend the ACA against this latest challenge. Typically, the executive branches argues to uphold existing statutes in court cases.

The lawsuit was initiated by Texas's attorney general Ken Paxton, who describes himself as a tea party conservative, with support from 18 GOP counterparts and a governor. The plaintiffs argue that the entire ACA is invalid. They trace their argument to the Supreme Court's 2012 ruling in which Chief Justice John Roberts Jr. wrote for the majority that the penalty the law created for Americans who do not carry health insurance is constitutional because Congress "does have the power to impose a tax on those without health insurance."

As part of a tax overhaul a year ago, congressional Republicans pushed through a change in which that ACA penalty will be eliminated, starting in January. The lawsuit argues that, with the enforcement of the insurance requirement gone, there is no longer a tax, so the law no longer is constitutional.

"Once the heart of the ACA - the individual mandate - is declared unconstitutional, the remainder of the ACA must also fall," the lawsuit said.

In his 55-page opinion, O'Connor writes that the individual mandate is unconstitutional, saying that it "can no longer be fairly read as an exercise of Congress' tax power."The judge also concludes that this insurance requirement "is essential to and inseverable from the remainder of the ACA."

In a court brief and an accompanying letter to congressional leaders, the Justice Department did not go that far. Justice officials contended that, once the insurance mandate's penalty is gone next month, that move will invalidate the ACA's consumer protections, such as its ban on charging more or refusing to cover people with preexisting medical conditions. But the administration argued that many other parts of the law could be considered legally distinct and thus can continue.

Just before the brief's deadline, three Justice attorneys involved with the case withdrew from it.

In the letter to Congress, then-attorney general Jeff Sessions said that Justice was taking this position ""with the approval of the president of the United States." President Donald Trump has vowed since his campaign to dismantle the law, a main domestic achievement of his precessor, and the administration has been taking steps on its own to foster alternative insurance that tends to be less expensive because it skirts ACA requirements.

The lawsuit has been opposed by a coalition of 17 Democratic attorneys general, led by California Attorney General Xavier Becerra, a former congressman. The Democrats contend that while the Republican tax law will eliminate the federal penalty for being uninsured, it does not negate the ACA's constitutionality.

"Today's misguided ruling will not deter us. Our coalition will continue to fight in court for the health and well being for all Americans," Becerra said in a statement after the ruling Friday.

During oral arguments in September, O'Connor asked more pointed questions than of the Democratic attorneys general than of the Republicans.

The midterm elections last month have altered the political map in the case. In Wisconsin, an incoming Democratic attorney general, Josh Kaul, campaigned on a promise to withdraw the state from the lawsut, but Wisconsin's Republican legislature and outgoing Gov. Scott Walker, R, have tried in a lameduck session to block his ability to do that. In Maine, outgoing Gov. Paul LePage, R, joined the lawsuit, but the state attorney general's office told the court last month that the governor did not have power to do so on his own.

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