GOP Stuck in a ‘Lose-Lose’ Dilemma With Judge’s Obamacare Ruling
(Bloomberg) -- Congressional Republicans were handed the gift they said they wanted when a Texas judge invalidated Obamacare late last week. Yet few now seem willing to open it.
After spending the eight years since the law passed promising -- and failing -- to repeal the Affordable Care Act, Republicans are no closer to crafting a politically viable alternative to the law, which has gained favor with voters and has transformed the nation’s health-care system.
Republicans are “still in the throes” of devising an Obamacare alternative if the ruling is upheld, Senate Finance Chairman Orrin Hatch, a Utah Republican, said Monday. “It’s a work in progress.”
At stake in the case are subsidies that have expanded insurance coverage to millions of Americans, as well as popular provisions in the law that protect sick people from being denied coverage or charged higher prices, a ban on lifetime limits, and allowing people under 26 to stay on a parent’s plan.
Although many analysts expect the ruling to be reversed, the appeals process could take two years or more, giving Democrats a powerful issue to use in the 2020 campaign for the White House and Congress.
Caught Off Guard
It’s a “lose-lose” situation for Republicans, said Rodney Whitlock, a lobbyist and former health policy adviser to incoming Senate Finance Chairman Chuck Grassley. He said the scope of the ruling “frankly caught a lot of people off guard.”
“It’s really hard to make anything positive of this,” Whitlock said. “Republicans would have been much more comfortable talking positively about pre-existing conditions and issues like that. I don’t think they were prepared to get into the entire ACA. It’s just a much more complicated conversation.”
U.S. District Judge Reed O’Connor, deciding a case brought by 20 Republican state attorneys general and supported by President Donald Trump’s administration, ruled that the 2017 decision by the Republican-controlled Congress to kill a tax penalty for individuals who don’t get insurance essentially voided the entire Affordable Care Act.
The next stop for the case is the conservative Fifth Circuit Court of Appeals. After that it could be considered by the Supreme Court, where the law stands a good chance of surviving. Chief Justice John Roberts and four Democratic-appointed justices who upheld the law against challenges in 2012 and 2015 remain on the court.
Republicans, many of whom have decried the law as an unnecessary and harmful government intrusion into the health care market, were quick to emphasize that despite O’Connor’s ruling the law remains in place during the appeals process.
“I thought it was a thoughtful opinion, but clearly the status quo will be maintained pending appeals to the Circuit Court and the Supreme Court,” Texas Senator John Cornyn, the chamber’s second-ranking Republican, said Monday. “In the meantime, I’m glad to see that the individual markets, the insurance companies in those markets, are maintaining the status quo.”
Missouri Republican Senator Roy Blunt said discussion about the issue is “a total waste of time right now.” He said the ruling has no immediate impact, and “we are months, maybe years away from the final determination by some higher court."
Senator Lamar Alexander, a Tennessee Republican who chairs the health committee, said it “seems unlikely” that the Supreme Court would overturn Obamacare with this case.
The 2012 case focused on the law’s “individual mandate,” its requirement that people acquire insurance or pay a tax penalty. In his pivotal opinion, Roberts said the mandate was a constitutional use of Congress’ power to levy taxes.
But O’Connor, who sits in Forth Worth, said the 2017 elimination of the tax penalty by the Republican-controlled Congress was a critical change. He reasoned that, without the tax penalty, the individual mandate was no longer valid and that the rest of the law couldn’t stand without it.
It’s far from clear that Roberts would reach the same conclusion. He said in his opinion the individual mandate didn’t carry any consequences beyond the tax penalty. The lack of practical significance could lead Roberts to question whether anyone now has the legal right to go to court to challenge the provision.
And even if he were to ax the mandate, Roberts typically is reluctant to overturn sweeping statutes because of one unconstitutional provision, as O’Connor did. In a separate part of the 2012 ruling, Roberts struck down one feature of the health-care law by making the Medicaid expansion optional for states, but concluded that “Congress would have wanted to preserve the rest of the act.”
Senator Susan Collins, a Maine Republican who backed the tax law that zeroed out the mandate penalty, said on Monday that “of course” she didn’t believe she was voting to repeal the entire ACA.
Senate Majority Leader Mitch McConnell’s office had no comment Monday when asked about the ruling. The Kentucky Republican said in an October interview that it wasn’t a mistake for the Trump administration to back the lawsuit because “it’s no secret that we preferred to start over” on health care.
Senate Minority Leader Chuck Schumer, a New York Democrat, called for an immediate vote in Congress to oppose the lawsuit. House Democrats vowed Monday to intervene in court against the case after they take control of the chamber next month.
“We’re not going to let this stand. We are going to fight this tooth and nail in court,” said incoming House Energy & Commerce Chair Frank Pallone, whose committee has jurisdiction over health care. “We will have hearings right away to get to the bottom of this.”
Democratic Representative Cedric Richmond, of Louisiana accused O’Connor of “auditioning to head up to the appellate court by pleasing Trump."
For Republicans, the ruling rekindles the debate in last month’s midterm elections in which Democrats used the issue of health care to flip 40 seats to win the House majority. Exit polls showed large Democratic advantages on health care contributed to GOP defeats in House races as well as the Senate contests in Arizona to Nevada and governor’s races in Wisconsin and Michigan.
“They are now the proverbial dog that caught the truck,” said Brad Woodhouse, a Democratic strategist and activist.
Whitlock said has GOP has yet to “work out where it stands” on health care and formulate a policy approach that is politically viable. A challenge is how to preserve the popular parts of the ACA without federal regulations and subsidies that conservatives oppose.
He said that “2010 broke Republican ideology in that Republicans who wanted to use the federal government to organize the marketplace now battle with Republicans who believe there is no federal role and it should all be state-driven.”
As for now, Whitlock added, it feels like “groundhog day” for the health care industry and policy makers. “They’re not panicking, but there’s a certain nauseating feeling of: ‘Oh my God. Fifth Circuit? Supreme Court? Are we really going through this again?’”
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