The Corner

Health Care

An Obamacare Lawsuit’s Onion of Absurdity

Back in February I noted a new lawsuit against Obamacare. Forgive the lengthy self-quote, but nothing else will make sense without the backstory here:

When the Supreme Court upheld Obamacare . . . it determined that the individual mandate was a tax, and thus could be implemented through Congress’s taxing power. Four dissenting conservative justices would have found the mandate to be unconstitutional — and also that it was a core part of the law and thus “inseverable” from the rest, meaning the entire Affordable Care Act should be struck down.

Now, Republicans have in fact severed the mandate from the rest of the law, reducing the penalty to $0 after this year. A new lawsuit from 20 states against the Trump administration challenges courts to figure out what the old ruling means in light of this development. . . .

The argument goes like this. Owing to procedural rules in the Senate, Republicans technically didn’t repeal the mandate — it’s still there, only with a $0 penalty. Further, the mandate can’t be a tax if it doesn’t require the collection of any taxes, obliterating the previous ruling’s defense of its constitutionality. And finally, the four conservative justices were right about the severability question, on which the majority didn’t rule: The mandate is a fundamental aspect of the law, and if the mandate itself must go, so must the rest of Obamacare.

The problem, of course, is that since Obamacare’s enactment, everything has changed regarding the “severability” question. Back then, the mandate was seen as one leg of a three-legged stool; without it, the whole system would fall over, because people would wait until they got sick to buy coverage (and their right to buy it at that point would be protected by the law’s preexisting-condition rules). Congress itself stressed this in the text of the Obamacare statute.

But experts’ view of the matter shifted over time, with the CBO coming to believe the mandate was less important than previously thought. And then — to repeat — Congress actually severed it, reducing the penalty to $0. Admittedly, Congress didn’t remove the “findings” stressing the mandate’s importance from the original text. But as the law professor and Obamacare opponent Jonathan Adler has put it, “When a Court declares a law to be unconstitutional, it is saying it can’t be enforced. Congress has already done that. The mandate is a nullity either way.”

And if all that isn’t making your head hurt — the once-inseverable has now been severed but is still somehow inseverable — the Trump administration peeled back a new layer of absurdity with a brief last night. Its argument? The penalty is severable from the rest of the law . . . except for the preexisting-condition rules (“guaranteed issue” and “community rating”). Despite the fact that Congress eliminated the penalty while leaving those very rules in place.

As a legal matter, well, good luck with that. As a policy matter, it is certainly true that preexisting-condition rules can cause problems in the absence of a mandate (though that’s the setup Congress chose). And as a political matter, is it really smart to try to gut protections for people with preexisting conditions?

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