WILL OBAMACARE LAST?

Written on .

There is an important case pending before the Fifth Circuit U.S. Court of Appeals, dealing with whether ObamaCare will survive or instead be declared unconstitutional.  Last December, a Texas federal judge invalidated the entire law, after Congress in 2017 passed a law that reduced the penalty provisions to employees for being uninsured to $0.  It is argued that this leaves the ACA as a stand-alone command to buy an insurance product that the federal government deems suitable, but it does not raise any revenue, and thus cannot be considered the "tax" aspect that was necessary to sustain its constitutionality under an earlier Supreme Court ruling.  Two of the three judges on the appeals court indicated that they were dubious that without the mandatory provisions the law would be constitutional.  Even if portions of the law should be invalidated, however, other unrelated portions may remain, and in any event the issue is likely to eventually go back to the U.S. Supreme Court.

In a related development, the Administration announced on 6/13/19 a plan to let employees use special pre-tax health arrangements known as HRAs, which are funded by employers with pre-tax dollars, to buy individual insurance, including policies that do not comply with the ACA provisions.  The starting date for the plan is January 2020.  While the plan may expand coverage to another one million people previously uninsured, critics say the approach may encourage consumers to pull out of the ACA insurance pool.

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