As Supreme Court Weighs Obamacare, Health Insurers See Law’s Survival

A person takes a photograph of the U.S. Supreme Court building in Washington, D.C., U.S.,

The health insurance industry doesn’t see the U.S. Supreme Court overturning the entire Affordable Care Act and leaving tens of millions of Americans without medical coverage.

The nine-member Supreme Court will hear arguments Tuesday on a lawsuit brought by Republican attorneys general and backed by the Donald Trump White House who want the ACA invalidated.

But health insurance executives including Centene chief executive Michael Neidorff said he remains “relatively confident” the Supreme Court won’t strike down the law. Centene is the nation’s largest provider of individual coverage under the ACA with more than 2 million such customers and provides health benefits to millions more via the law’s Medicaid expansion.

 “I don’t believe when push comes to shove, they want to put all of these people at the height of the pandemic on the streets with no insurance,” Neidorff told Wall Street analysts last month. “At one point, I thought it would be 7-2 when Justice (Ruth Bader) Ginsburg was still around and others. I said it could go to 6-3. It could still be 5-4.”

The case before the court, known as California vs. Texas, hangs on a key part of the ACA known as the individual mandate, which requires Americans to have a certain level of coverage or pay a financial penalty.

Given a 6-3 conservative majority, some supporters of the ACA worry the signature legislative achievement of former president Barack Obama could be in jeopardy. A ruling overturning the law would have huge consequences, ending coverage for more than 20 million Americans while stripping patient protections for tens of millions more Americans with pre-existing medical conditions.

But the health insurance trade group and lobby, America’s Health Insurance Plans (AHIP) says that the ACA should stand and therefore coverage would be maintained even if a “zeroed-out individual mandate is deemed unconstitutional.”

Pratik Shah, who co-heads the Supreme Court & Appellate practice at the law firm of Akin Gump Strauss Hauer & Feld, says the intent of Congress is clear in that zeroing out of the mandate’s tax penalty was not intended to invalidate the ACA.

Further, in a brief Shah and colleagues filed on behalf of AHIP and its health plan membership says arguments on “inseverability of the mandate” from the ACA are based on decade-old presumptions and not actual experience. AHIP represents health plans including Centene, CVS Health, parent of Aetna, Anthem, Cigna and myriad Blue Cross and Blue Shield plans.

“Over the course of a decade, the ACA has fundamentally reshaped the nation’s health care system,” Shah and colleagues wrote on behalf of AHIP in their brief. “Congress in 2017 chose not to disturb that paradigm shift—including the promise of affordable coverage for those with preexisting conditions—when defanging the individual mandate without repealing any other part of the ACA.”

“Texas and the federal government would have this Court wield an axe in responding to Congress’s scalpel,” Shah and colleagues wrote. “But invalidation of the ACA would flout Congress’s manifest intent, with profound consequences for our health care system and the hundreds of millions of people it serves. This Court must reject that outcome.”

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