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Dear Members,

Over the past several months, we have been updating you about a federal court case (Texas v. the US) challenging the constitutionality of the Affordable Care Act, otherwise known as the ACA or Obamacare. On Friday, the judge in the case decided to issue a “declaratory ruling” that the ACA is unconstitutional.

The most important thing to understand is that all provisions of the Affordable Care Act remain in effect. Your coverage and the protections it offers you remain in place while the case makes its way out of the Texas court, to the appeals court and possibly to the Supreme Court. This could take months or even years. Even though the President praised the decision, a high-ranking official in his administration issued an important statement clarifying that the decision had “no impact to current coverage or coverage in a 2019 plan.”

So nothing has changed for now, but what about the future?

While your 2019 coverage is secure, the ruling means that many health insurance consumer protections remain in future jeopardy, such as those that prohibit insurers from denying coverage for pre-existing conditions or setting prices based on health status and applying annual or lifetime limits to coverage. But because the judgement applies to every single provision of the ACA, there are many more possible implications in the coming years. It threatens hundreds of ACA provisions that haven’t been talked about in a long time such as the requirement that children be kept on parents’ plans until age 26, no cost sharing for preventive services and the subsidies consumers receive which helps them afford health insurance.

How did this happen?  

The case, which was originally filed by several state Attorneys General, argues that the entire ACA should be found unconstitutional because the 2017 Congress acted to zero out the penalty for not having insurance. Because the penalty for not having insurance was reduced to $0, the plaintiffs claimed that it could no longer be considered a tax, and if the penalty could not be considered a tax then Congress did not have the authority to legislate the mandate. In other words, the ACA is unconstitutional because the penalty for not buying insurance will be zero beginning in 2019. The US Supreme Court already confirmed in 2012 that the ACA is constitutional if the penalty is more than zero.

The plaintiffs also argued that the mandate is a central part of the ACA and without it, the remainder of the law cannot stand. The judge agreed with the plaintiffs’ arguments on all of these counts.

As already mentioned, it will be some time before we know how the case will come out. Please be assured that your 2019 coverage and your tax credits are in place, and we strongly encourage you to continue to take advantage of the financial protection your health insurance offers you.

We will continue to keep our members informed about anything new in this case. In the meantime, please do not hesitate to reach out to us with questions. Click here for additional information.

Sincerely,

Cathy Mahaffey
Common Ground Healthcare Cooperative CEO

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