ACA lawsuits progress through the courts
House v. Price
A U.S. appeals court has allowed 16 states to intervene in a lawsuit over whether subsidy payments made to insurers under the ACA are legal. The decision comes as President Trump recently threatened to cut off the cost sharing reduction (CSR) payments to marketplace insurers, calling them a “bailout.”
On Aug. 1, the U.S. Court of Appeals for the District of Columbia Circuit granted a motion by 18 attorneys general to enter the lawsuit. The attorneys general represent California, New York, Connecticut, Delaware, Hawaii, Illinois, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, New Mexico, North Carolina, Pennsylvania, Vermont, Virginia, Washington, and the District of Columbia.
Under the ACA, the federal government provides CSR payments to insurers to offset the costs for providing discount plans to patients who earn up to 200% of the federal poverty level. Plans on the individual exchanges are required to cover a package of essential benefits with pricing limitations to ensure that out-of-pocket costs are low enough for low-income patients.
Republican members of the House of Representatives sued the HHS over the CSR payments under the Obama administration, claiming the funding was illegal because it was never appropriated by Congress. A court ruled in favor of the House in 2016, but an appeal filed by the Obama administration allowed the CSR payments to continue. President Trump has not indicated whether he plans to drop the appeal or carry on the case. But if he fails to continue the suit, the move would immediately end the CSR payments.
On July 29, President Trump tweeted, “If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!”
The state attorneys general are ready to defend the ACA and the cost sharing reduction payments, California Attorney General Xavier Becerra said in a statement.
“If Donald Trump won’t defend these vital subsidies for American families, then we will,” Mr. Becerra said in the statement. “This ruling gives my fellow attorneys general and me the ability to stand up for the millions of families who otherwise would lack access to affordable health care. It’s time Americans knew we were working for them, not against them.”
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