By ETIENNE DEFFARGES
Having survived years of attacks from Republicans at the federal level, will the surviving ACA be rendered obsolete by Democrats’ local and state efforts towards universal health care? This could be an ironic twist of fate for Obamacare. Conceived out of the conservative Heritage Foundation’s ideas and an early experiment in Massachusetts under a Republican governor, President Obama’s signature legislative achievement could very well survive its most recent judiciary challenge. But over time the ACA is susceptible to obsolescence, because of the many universal health care solutions being pushed at the state level.
Let’s start this brief outlook for Obamacare by reviewing how it has played defense, quite successfully thus far: During most of 2017 and 2018, the future of the ACA was always discussed in the context of Republican efforts to repeal it. After all, the GOP controlled the White House and both Chambers of Congress. Hadn’t Republicans spent the last four years of the Obama administration promising to repeal Obamacare the instant they could? And so they went after the ACA in 2017 with all the levers of Washington power. But repealing is one thing, legislating another: We know what happened in July 2017, when the last “repeal and replace” effort was defeated in the U.S. Senate by the narrowest of margins, because three Republican Senators, Susan Collins, Lisa Murkowski, and the late and much regretted John McCain, voted against the repeal. With their December 22 tax law, Republicans did succeed in eliminating the ACA’s individual mandate tax penalty owed by individuals failing to maintain “minimum essential coverage.” Most medical plans qualify for this, as long as they meet a number of requirements, such as not charging more for pre-existing conditions. For good measure, the Trump administration used executive orders in 2018 to allow low-cost plans not meeting these ACA guidelines to be offered by employers. Twenty state attorney generals from Republican states, led by Texas and Wisconsin, also initiated litigation against the ACA, arguing that without the tax penalty the law had become unconstitutional.
On November 6, after having campaigned heavily on health care and the protection of pre-existing conditions, Democrats won control of the House of Representatives, making further legislative challenges to the ACA very unlikely. The Midterm elections also saw three newly elected Democratic governors in Kansas, Maine and Wisconsin promising to bring to their constituents a key provision of the ACA, Medicaid expansion. The citizens of Idaho, Nebraska and Utah will also get Medicaid expansion, following the success of local ballot initiatives. In total, around 800,000 people are poised to gain access to Medicaid for the first time in these six states: Obamacare is on the march! Not so fast. On December 14, 2018, U.S. District Judge Reed O’Connor ruled for the twenty Republican states and against the ACA, arguing that once Congress repealed the tax penalty that enforced the individual mandate, the whole legislation became invalid—everything within the ACA, protections for pre-existing conditions, children under 26 insured within their parents’ plans, Medicaid expansion, etc. A lot of voices, not all of them from Democrats, criticized the ruling as stretching a legal principle called “inseverability” far beyond reasonable boundaries—how could for example the ACA Medicaid expansions be bundled with the individual mandate tax penalty? Legal scholars argued that Judge O’ Connor’s ruling ignored settled law, i.e. that Congress had refused to repeal the entire ACA in the summer of 2017, striking down only a portion of the legislation under the December tax law, and leaving the rest of the ACA standing. This ruling is being appealed by sixteen other states supporting Obamacare, joined in January 2019 by the newly installed Democratic House. After the appeal, will the U.S. Supreme Court have to rule (for the third time) on the constitutionality of the ACA? If this becomes the case, one has to remember that the Court affirmed twice the constitutionality of the ACA, in 2012 and 2015, with Chief Justice John Roberts voting with the majority on both occasions.
Despite this judicial development and the Trump administration slashing advertising and promotional budgets for ACA enrollments, the law remains very popular: After its six annual enrollment season, the ACA federal insurance marketplace proved again to be very resilient, with the number of Americans signing up for 2019 ACA health plans down only 4% relative to the prior year. Not surprisingly, Americans are interested in good health care coverage at affordable prices.
Author of “Untangling the USA: the Cost of Complexity, and What Can Be Done About It,” Etienne Deffarges has counseled, created, and invested in countless organizations during his professional life as a management consultant, business executive, and entrepreneur.