Constitution Daily

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Is Obamacare about to collapse?

December 17, 2018 by Lyle Denniston


Shortly after a federal judge in Texas ruled on Friday night that the entire Affordable Care Act (“Obamacare”) is unconstitutional, the government’s website posted a banner headline in a bright red block. It read: “Court’s decision does not affect 2019 enrollment or coverage.”

Not long after that, a key official tweeted: “There is no impact to current coverage or coverage in a 2019 plan.” The same message soon went out in a series of telegrams to state officials.

Then the White House issued this statement: “We expect this ruling will be appealed to the Supreme Court. Pending the appeal process, the law remains in place.”

On Saturday, former President Barack Obama weighed in with much the same message on Twitter, saying to his readers that it was “important for you to know that last night’s ruling changes nothing for now. As the decision makes its way through the courts, which will take months, if not years, the law remains in place and will likely stay that way.”

Was the Friday ruling by U.S. District Judge Reed C. O’Connor of Fort Worth already a dead letter, an empty constitutional declaration that stood for nothing? The key to his decision was a provision in the ACA that is due to go into effect on January 1, so did that mean that the ruling would mean something then?

Actually, what healthcare officials and the former President said did not amount to defiance of Judge O’Connor’s ruling, for two reasons: first, something the judge did do, and, second, something that he did not do.

What O’Connor did do was issue his decision in the form of a “declaratory judgment” – essentially, an extended statement of how he had sorted out the rights of the challengers and of the defenders of Obamacare, siding totally with the challengers. In that form, he decided only that particular lawsuit. The result, while binding on those directly involved, did not reach beyond those parties.

Everyone involved understands that this was not merely an advisory opinion. Since the 1790s, the federal courts have never had the authority to give legal advice; they are obliged constitutionally to decide genuine “cases or controversies” – actual, real-world lawsuits.

Thus, in essence, the decision is as binding as any other federal court ruling.

What Judge O’Connor did not do was to issue any order explicitly directing the federal government to stop enforcing the law, either as of Friday night or as of January 1 when, on paper, his ruling would appear to take effect. He had been asked explicitly to do just that, by lawyers for the 19 states that had filed the lawsuit against Obamacare, but the federal government – while otherwise supporting the challengers on key points – asked the judge to avoid such an order (technically, an “injunction”) and instead urged him to issue only a declaratory ruling.

There was also something else that the judge did not do: although knowing that his ruling is certain to be appealed, he did not put it on hold while the appeal process played out. So, his ruling did go into effect, in a definite though technical sense, as soon as it was published.

In essence, the Trump Administration was left with the option of choosing the time when it would stop enforcing the law – that is when it would carry out the judge’s ruling. That explains the White House statement that, “pending the appeal process, the law remains in place.”

One thing that may happen now, perhaps as soon as this week, is that some or all of the 16 states (and Washington, D.C.) that entered the case to defend Obamacare’s constitutionality will attempt to get Judge O’Connor’s decision formally postponed while they appeal.

Under federal court rules, they have to ask him first for such a delay. If he refuses, they can then ask the U.S. Court of Appeals for the Fifth Circuit. And, if that appeals court says no, the states favoring the law can take that request to the Supreme Court.

In the meantime, the deadline for Americans seeking health insurance coverage during 2019 under Obamacare had arrived on Saturday night, and the Texas ruling did not disturb that process or interfere with the coverage that those who signed up had obtained – at least that is the assurance that federal health officials have given. (At the government’s request, Judge O’Connor had delayed issuing his ruling until the evening of the last business day before the enrollment period was to end.)

Spokespersons for the health care industry, for hospitals and other medical providers, and operators of the state-run health insurance “exchanges” (marketplaces where insurance is available under Obamacare) have complained that there would be utter chaos if Judge O’Connor’s ruling would go into effect in practical terms.

Thus, everyone involved in the lawsuit and everyone affected by Obamacare will be paying attention to what happens in the courts.

The only thing that could upstage this court controversy would be if Congress were to take action to pass a new healthcare law to totally replace Obamacare or to make sufficient changes in it to save its constitutionality. President Donald Trump, in reacting to Judge O’Connor’s ruling, suggested that it was time for Congress to get to work on a new law.

Healthcare, as a federal entitlement, has deeply divided the two major political parties, especially since Obamacare was first enacted in 2010. It is possible that the recent election, showing major gains for Democratic candidates, many of whom made health insurance a central part of their campaign messaging, could create a more favorable climate in Congress.

For the next several weeks, then, health care and health insurance will be at the top of America’s legal, legislative and political agendas. The constitutional story is still being written.

UPDATE (12/17/18)

While the defenders of Obamacare are making up their minds what steps to take to try to assure that the judge’s ruling does not take full effect, Judge O’Connor has ordered both sides to file a joint report by January 4 proposing how the case should proceed in his court.  His order, issued late Sunday night, said their report is to suggest ideas on how he should rule on issues he did not discuss in the Friday decision.  Among those issues are specific requests by the challengers to formally block enforcement of all parts of the law and nullify all regulations issued by any federal agency to implement it.  If those requests were granted, all of Obamacare would cease to exist.

Lyle Denniston has been writing about the Supreme Court since 1958.  His work has appeared here since mid-2011. 


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