I am not a lawyer, so please don’t take any of the following as informed legal analysis.
The Trump Administration has decided to argue that the $0 penalty individual mandate is unconstitutional and therefore community rated guaranteed issue requirements are unconstitutional as they are non-severable from the mandate. That would destroy the individual market reforms of the ACA.
In the government’s brief, the Trump DOJ makes two arguments. (A) The individual mandate, which the Supreme Court upheld in NFIB v. Sebelius, is unconstitutional; and (B) because the mandate is unconstitutional, the most important provisions of the Affordable Care Act should also be struck down, on the ground that they are not severable from the now-unconstitutional mandate.
The first of these arguments is excruciatingly stupid, but has the complementary virtue of being irrelevant on its own…
To this we say: Whatever. We’re law professors, and not even we can get worked up about the difference between “do it, or pay the price, which is zero” and “do what you want…”
there are actually instances where severability doctrine is capable of generating clear answers to obvious questions. The easiest case—hard to imagine, but stay with us—would be if Congress actually passed a piece of legislation that eliminated, as a formal or practical matter, one provision of a law, but left the rest of that law in place. In that case, the reconstruction of Congressional intent would be straightforward: What Congress wanted was a law without that provision.
But that is exactly what Congress did in the tax bill, with respect to the Affordable Care Act. And that is what makes the Justice Department’s argument so transparently dishonest.
Yeah, this is dumb.
The problem with the Trump Administration's response to the latest ACA suit is not its refusal to defend the mandate so much as its adoption of problematic (and quite cynical) approach to severability.
— Jonathan H. Adler (@jadler1969) June 8, 2018
As a reminder, Jonathan Adler was one of the prime proponents of the “Moops” argument that tried to get subsidies tossed for citizens of states using Healthcare.gov. He thinks this is a bullshit argument.
It is a bullshit set of arguments that are being made in bad faith. And usually that would be enough. But since this is related to the ACA and the district judge is very conservative, we’re may be riding this out for a while as it gets appealed up and down the chain multiple times.
On a pragmatic basis, this introduces uncertainty into the market. Insurers hate uncertainty. They respond to it in one of two ways. They can either run like hell from the market or they can jack up their premiums to incorporate the risk that mid-contract they have to operate under a different regulatory regime.
On a political level, this highlights the popular parts of the ACA (community rating and no denial of coverage for pre-exisiting conditions) just as the election season heats up.