In the News

House Hearing on ACA Lawsuit Gets Heated

Washington, February 6, 2019

A House hearing Wednesday that was supposed to be about the possible effect of the district court case in Texas on the Affordable Care Act (ACA) degenerated into a heated discussion about whether the committee should be discussing the case at all.

"I am glad that we are holding our first hearing of the year ... It's unfortunate we're having a hearing that doesn't move toward the development of any policies to improve healthcare for Americans," Rep. Michael Burgess, MD (R-Texas), ranking member of the Energy & Commerce Health Subcommittee, said in remarks that appeared to be directed mainly toward committee chairwoman Anna Eshoo (D-Calif.). "To that effect, there are numerous options that you could bring before us that could moot the [case we're discussing], but the subcommittee apparently has chosen not to do so."

Burgess suggested that the subcommittee instead hold a hearing about a "Medicare for All" government-run healthcare system, pointing out that other committees have already announced hearings on the subject. "Do I agree with [that] policy or think it would be a good idea for the American people? ... No, I do not," he said. "And I would gladly engage in a meaningful dialogue about what such a policy would mean for the American people."

Sharp Rebukes

Burgess's remarks brought a swift rebuke from several Democrats on the committee. "I was going to try to be nice today but after I listened to Mr. Burgess, I can't be ... I have to speak out," said Rep. Frank Pallone (D-N.J.), chairman of the full Energy & Commerce Committee.

"You were the chairman of this subcommittee the whole time that the Republicans tried unsuccessfully to repeal the Affordable Care Act. I've had so many meetings where I saw you come in ... and repeatedly tell us the ACA was bad law, terrible law, it needs to be repealed. I saw no effort at all in the time you were the chairman to try to work toward solutions, toward improving the ACA; what I saw were constant efforts to join with President Trump to sabotage it."

"And the reason this hearing is so important is the ultimate sabotage would be to have the courts rule the ACA was unconstitutional, which is totally bogus," he added.

"Republicans spent all their time [last term] trying to take healthcare away from the majority of Americans," said committee member Nannette Diaz Barragán (D-Calif.) in response to a complaint by Rep. Buddy Carter (R-Ga.) that the subcommittee should be looking at high drug prices instead. "We're trying to highlight the importance of this lawsuit ... You're darn right we're going to take this up and you're darn right we're going to have hearings on this."

The Lawsuit Explained

The lawsuit in question, known as Texas v. the United States of America, was filed in February by the state of Texas along with 19 other states, all led at the time by Republican governors. It argues that because the tax reform bill passed by Congress -- the Tax Cuts and Jobs Act (TCJA) of 2017 -- gets rid of the ACA's "individual mandate" penalty for not having health insurance, the requirement for individuals to have health insurance is void, and because of that, the rest of the law -- which they say hinges on the mandate -- should be invalidated.

In December, U.S. District Court Judge Reed O'Connor ruled that the ACA was unconstitutional.

"In NFIB [another court case involving the ACA], the Supreme Court held the individual mandate was unconstitutional under the Interstate Commerce Clause but could fairly be read as an exercise of Congress's tax power because it triggered a tax," O'Connor wrote. "The TCJA eliminated that tax. The Supreme Court's reasoning in NFIB ... thus compels the conclusion that the individual mandate may no longer be upheld under the tax power. And because the individual mandate continues to mandate the purchase of health insurance, it remains unsustainable under the Interstate Commerce Clause -- as the Supreme Court already held."

The judge's verdict is currently on hold while the case makes its way through the appeals process, and the Department of Health and Human Services has declared that it will continue enforcing the law in the meantime. But if the verdict does take hold, argued hearing witness Christen Linke Young, a fellow at the USC-Brookings Schaeffer Initiative for Health Policy, a left-leaning think tank here, "In many ways, things would look like what they were before the ACA was in place ... The Congressional Budget Office estimated that repeal of the ACA would result in as many as 24 million additional uninsured Americans."

Avik S.A. Roy, president of the Foundation for Research on Equal Opportunity, in Austin, Texas, pointed out that so far, getting rid of the mandate "has not blown up the insurance market; indeed, it has had no effect." In addition, it is the law's limited enrollment period, not the guaranteed issue provision, that ensures no gaming of the system because you can only enroll during a certain time of the year, he argued.

Roy disagreed with critics of the current law who suggest that a separate insurance pool needs to be created for individuals at high risk of expensive health problems. "The largest impact is from the ACA's age bands, which on their own double the cost of insurance for Americans in their 20s and 30s, forcing many to drop out of the market because younger people consume one-sixth of the healthcare that older people do."

Instead, he said, "the most market-based approach for covering those with preexisting conditions is not to repeal the ACA's guaranteed issue [and other] provisions, but to preserve and integrate the principles of a high-risk pool into a single insurance market through reinsurance ... I hope both parties can work together to achieve this."

Preexisting Conditions in the Spotlight

As for the case itself, assuming it gets appealed all the way to the Supreme Court, "the probability of the Supreme Court ruling to overturn the entire ACA remains very low," said Thomas Miller, JD, resident fellow at the American Enterprise Institute, a right-leaning think tank here. "Even if appellate courts also find some form of constitutional injury in what remains of the ACA's individual mandate ... the severability stage of such proceedings will become far more uphill for the plaintiffs."

Another question about the lawsuit is whether the plaintiffs have grounds to sue at all, said Simon Lazarus, a constitutional lawyer and writer. He noted that under the ACA, people who chose to pay the penalty rather than buy insurance are considered to have complied with the law, and now that the penalty has been reduced to zero, "no one is compelled to buy insurance to avoid a penalty ... So there is no injury and no standing to sue."

Much of the subcommittee's discussion centered around the ACA's guarantee of coverage for people with pre-existing conditions. "Before the ACA, insurance companies didn't have to pay for HIV tests, or individuals with HIV couldn't get coverage until they were really sick, or on their deathbeds," said Rep. Raul Ruiz, MD (D-Calif.). "Insurance coverage for these patients went from only 10% to 99.9% because of the ACA ... [taking that away] would be devastating to HIV patients."

Rep. Larry Bucshon, MD (R-Ind.), was one of several Republicans who said that all the subcommittee members supported protecting patients with pre-existing conditions. "I think we need a policy discussion about the most appropriate way to do that," he said, noting that because deductibles under the ACA can be very high, not everyone is getting the healthcare they need. "I'm hoping we can have hearings on how we can get the costs down, and insurance can almost solve itself if we can do that."

Joyce Frieden
MedPage Today