Insurer lobby group weighs in on Obamacare individual mandate case

The U.S. Justice Department says it will no longer defend major parts of the Affordable Care Act in court.

The Trump administration, in a late-Thursday court filing, stated that it would no longer defend provisions of the health care law, known as Obamacare, that require people to have health insurance and guarantee access to health insurance regardless of any medical conditions, the Associated Press reported.

The lawsuit led by Texas Attorney General Ken Paxton, argued an earlier case against the ACA made it clear that tax penalty was an essential component of the law, and when the Supreme Court upheld the ACA the ruling stated "without the tax penalty, the mandate that individuals purchase health insurance was an unconstitutional exercise of federal power".

Removing consumer friendly provisions like guaranteed issue, whereby health insurers can not deny coverage to applicants or charge more based on health status, will result in renewed uncertainty in the market as well as push up rates for older and sicker patients, AHIP added.

These consumer protections proved enormously popular with Americans and are among the reasons why efforts to repeal Obamacare in Congress failed a year ago.

"Removing those provisions will result in renewed uncertainty in the individual market, create a patchwork of requirements in the states, cause rates to go even higher for older Americans and sicker patients, and make it challenging to introduce products and rates for 2019", said America's Health Insurance Plans, one of the industry's main lobbying groups.

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The filing declares unconstitutional the so-called individual mandate-which requires nearly all Americans to purchase health insurance or pay a "tax" if they don't-and calls for several elements of ACA to be invalidated.

But it says the rest of the law, including Medicaid expansion, can remain in place.

The Justice Department rarely declines to argue in favor of existing law in court and this decision will put pressure on the Affordable Care Act, the formal name for former President Barack Obama's signature domestic achievement.

Timothy Jost, law professor emeritus at Washington and Lee University in Virginia said the Trump administration is trying to persuade the court to do what it was unable to achieve in Congress past year - essentially, repeal key parts of the Obama health law.

Shortly before the government's court filing, three career lawyers at the Justice Department withdrew from the case and were replaced by two political appointees, according to court filings.

"It's just one more part of the story of trying to politicize the Justice Department", said Jost, a supporter of the health law.

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