AUSTIN – Today, the Trump Administration filed a brief agreeing with a lawsuit brought by the Texas Public Policy Foundation and the state of Texas that key components of the Affordable Care Act (ACA) are unconstitutional. In the Department of Justice’s response, the federal government agreed that “Plaintiffs have demonstrated a substantial likelihood of success on the merits.” DOJ proposes that the Court enter a declaratory judgment that the ACA’s provision establishing the individual mandate, the requirement that all Americans purchase health insurance, be invalid as of January 1, 2019.

“Today’s filing by the Trump Administration is a death blow to the ACA,” said TPPF litigation director Robert Henneke. “This filing shows President Trump standing by his word to repeal ObamaCare even as Congress remains gridlocked and fails to act. If the Court agrees with today’s DOJ filing, the ACA will be left as no more than a combination of onerous regulations and burdensome taxes – all of which should be fully repealed.”

Specifically, DOJ agrees with Texas and TPPF that the individual mandate is unconstitutional as a result of a provision in the Tax Cuts and Jobs Act that reduced the individual mandate penalty to zero. If the penalty does not raise revenue, DOJ reasoned, then it cannot be a tax. Therefore, enforcing the penalty would be an overreach of Congress’s authority.

Furthermore, DOJ agreed that the guaranteed-issue and community-rating requirements were also unconstitutional because they could not be considered separately from the individual mandate. “Without an individual mandate,” DOJ wrote, “[this] would allow individuals to game the system by waiting until they were sick to purchase health insurance …. the polar opposite of what Congress sought….”

In its response, DOJ specifically quotes TPPF’s clients as proof of adequate injury from the challenged provisions. In April, the Texas Public Policy Foundation, on behalf of individual Texans burdened by Obamacare, filed to join the Texas-led, 20 state lawsuit challenging the Affordable Care Act as unconstitutional as amended by the Tax Cuts and Jobs Act of 2017. In the lawsuit, TPPF represents Neill Hurley and John Nantz, individuals who wish to be able to purchase health insurance coverage in a competitive market that meets their needs, is affordable and enables them to receive health care from their preferred providers.

For more information, please contact Sarah Silberstein at ssilberstein@texaspolicy.com or 512-472-2700.    

Texas Public Policy Foundation is a non-profit free-market research institute based in Austin that aims to foster human flourishing by protecting and promoting liberty, opportunity, and personal responsibility.

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