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Los Angeles Times
Los Angeles Times
National
Noam N. Levey

Obamacare returns to court, creating new uncertainty about health coverage for millions

NEW ORLEANS _ The future of the Affordable Care Act, and the health coverage it has delivered to millions of Americans, is once again in doubt as a federal appeals court in New Orleans convenes Tuesday to hear arguments in a lawsuit seeking to invalidate the law.

The hearing at the U.S. 5th Circuit Court of Appeals _ which pits blue states defending the law against red states and the Trump administration seeking its repeal _ has also raised the possibility that the health care law, often called Obamacare, might survive in only parts of the country.

Such an outcome would eliminate insurance protections for tens of millions of people and mark one of the most dramatic turns in the nearly decade-long legal fight over the law.

It would also widen the divide in the U.S. between states that have embraced the law and its extensive series of insurance protections and those that have been fighting it since President Barack Obama signed the legislation in 2010.

Working to save the law are 20 states, led mostly by Democrats, including California, which has used the law to engineer a dramatic expansion of insurance coverage.

They face off against Texas and 17 other Republican-led states that have sued to invalidate the law, arguing that when Congress in 2017 scrapped a penalty against people who didn't have health insurance, lawmakers removed a pillar of the law that was essential to expanding health coverage. The penalty was once deemed critical to getting young, healthy people to sign up for coverage and keeping premiums affordable.

The Trump administration, which in 2018 made the unusual decision not to defend the law, now fully backs Texas' lawsuit and is urging a full repeal.

In December, a federal judge in Texas backed the plaintiffs' argument, issuing a highly controversial ruling that the entire law is unconstitutional.

California and the 19 other states, as well as the District of Columbia, which won permission to defend the law when the Trump administration declined to do so, appealed to the federal court in New Orleans to reverse the Texas ruling.

A three-member panel consisting of judges appointed by Presidents Trump, George W. Bush and Carter will hear the case Tuesday.

California and the other states defending the law argue Congress did not intend to repeal the whole law when it did away with the mandate penalty in the massive tax bill enacted in 2017.

And there is little evidence that eliminating the penalty has jeopardized the health care law's broader program for expanding health coverage. Most insurance markets continue to function, and millions of poor Americans are still getting coverage through an expansion of Medicaid, also made possible by the law.

Even senior Trump administration officials, including White House economists and Justice Department lawyers, have noted in recent months the success of insurance markets and dismissed the impact of eliminating the penalty.

"Another year of stable enrollment," Seema Verma, who oversees the marketplaces as administrator of the Centers for Medicare and Medicaid Services, said in March after the agency released a report showing 11.4 million people signed up for coverage on the marketplaces for 2019, just shy of the total the year before.

Administration lawyers are nonetheless pushing the appeals court in New Orleans to scrap the law.

German patients get the latest drugs for just $11. Can such a model work in the U.S.? �

In a complicating twist, Justice Department attorneys also argued in papers filed with the court last week that the appeals court could invalidate the health care law only in the 18 red states that are suing.

That could mean that insurance protections _ including the ban on insurance companies denying coverage to people with preexisting medical conditions _ could disappear in Texas, but remain in California.

Other provisions could be more difficult to roll back in some places, experts say. For example, the law established a new federal office to support experiments by physicians and hospitals to improve quality and lower health care costs. It is unclear if the federal Department of Health and Human Services would be forced to withdraw support for experiments in states where the law was repealed.

Officials at the U.S. Department of Justice have declined to discuss the litigation.

California Attorney General Xavier Becerra said the state and its allies aim to save the law nationwide.

"Together, the Trump administration and the Texas-led coalition risk the health of nearly every American, from the young to the elderly, the sick to the gainfully employed," Becerra said.

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