Over the past several months, another legal case against the Affordable Care Act has been rolling forward. In brief, several years ago the Supreme Court ruled that Congress had constitutional authority to create the Affordable Care Act health programs not due to the Commerce clause, but do the taxing power. Recently, Congress repealed the taxing authority inside the ACA. This has led to a new round of court cases that now, unlike previously, the ACA is unconstitutional.
This week, the Department of Justice filed its 75-page brief with the Fifth Circuit Court. DOJ now takes the position that yes, with the tax authority line item being repealed, the ACA as a whole is unconstitutional. (This is the position a Dallas judge took in 2018).
For policy watchers, this immediately raises issues. The ACA contained a great number of provisions unrelated to health insurance, such as creating the Center for Innovation (CMMI) at Medicare. In addition, remember that in 2010, modern biosimilars law was also rolled into the ACA. Are these all repealed because the ACA must be viewed as a whole and its parts are "inseverable?"
Health Affairs and Link to DOJ Case
Health Affairs has a detailed open-access analysis of the case so far, here. And the 75-page DOJ brief is online here.
DOJ handles the severability issue on pages 37-38. The current Trump DOJ argument is that all the ACA provisions should be jettisoned, except, only where the "provisions actually injure the individual plaintiffs."
DOJ notes that ACA amended criminal statutes around healthcare fraud. DOJ states that these are one example of parts of ACA that do not harm the plaintiffs, and therefore, plaintiffs have no standing to raise them in court nor see them thrown out. Presumably CMMI and biologicals law would also be "severable" meaning they could stand if the rest of ACA was struck down. For example, Trump Administration proposed creating a future policy to tie Medicare drug prices to European drug prices, a showpiece idea which turns out to hinge on the CMMI, which is embedded as part of the ACA.
Survival of CMMI or Biosimilars Would Be Decided by Local Judge on Remand
DOJ doesn't go into detail, but on page 38 notes, "The district court can determine the precise scope of judgement on remand" (e.g. just which paragraphs of the 1000-page law go, and which stay.)
The judge there, however, initially did throw out the whole of the ACA, from the first word to the last, without regard to needing to read all its diverse parts and without regard to this "standing of plaintiffs" issue.
LA Times here. "Legal nuttery...". One commenter I read noted that the DOJ filing was signed only by two lower level DOJ attorneys (Joseph Hunt and August Flentje) and considered that unusual.
The standing to bring suit against the ACA has gotten thinner. Originally, plaintiffs could complain the ACA forced them to pay a tax if they did not have health insurance, but that provision is gone.
Here, DOJ believes the ACA hurts the plaintiffs because it limits range of choice in insurance markets (at page 18, page 24, etc.) DOJ cites the the word "choice" appears 10 times. For example, under ACA, health plans must cover preventive services like mammography and you don't have a choice to get a non-mammography health plan. You're thus injured; take it to the Supreme Court!
I'm not an attorney, but there are lots of state laws that have lots of restrictions on how insurance or other sales and products operate. And federal laws restrict your ability to buy a car without airbags. Maybe the state can regulate health plans moreso than the federal government. Cases back in the 1890s ruled that Congress couldn't interfere with racial discrimination at private schools and clubs and employers, for example, striking down parts of the prior 1875 Civil Rights Act. And parts of the New Deal in the 1930s were struck down as exceeding the authority of Congress, well, until they weren't any more. Maybe the attempted posture here will be that states can require state health insurance (say) to require mammography, but Congress can't, since Congress can't place any limits on health plans under this theory. Of course, the plaintiffs might have standing to sue as "injured" because of the "limits of choice" on their health plan purchases, but they might not win, because the limits serve some overriding federal purpose (just like air bags).