Does Anyone Support DOJ's Position in the Texas ACA Case?

The Trump Administration's embrace of an implausible legal theory has few defenders.

On Monday, the Department of Justice informed the U.S. Court of Appeals for the Fifth Circuit that it would not be supporting an appeal of a district court decision holding that the entire Affordable Care Act (ACA) must be invalidated. Although the district court decision in Texas v. US embraced a far more expansive remedy than the Justice Department had proposed, the Administration decided that it would support the court's conclusion that Congress's decision to zero out the tax penalty used to enforce the individual mandate in 2017 required judicial invalidation of the entire law enacted in 2010.

The Justice Department's decision prompted criticism from across the ideological spectrum, including from folks who have been quite critical of the ACA. The Cato Institute's Michael Cannon, for example, penned an op-ed for the New York Post thoroughly rejecting the slapdash legal theory embraced by district court judge Reed O'Connor and DOJ:

In a dramatic reversal, the Trump administration has asked a federal appellate court to uphold a lower-court ruling striking down all of ObamaCare as unconstitutional.

You might expect me to be happy. The New Republic calls me "ObamaCare's single most relentless antagonist." The Week says I'm "ObamaCare's fiercest critic." Give me five minutes, and I'll explain how the so-called "Patient Protection and Affordable Care Act" ironically makes health insurance less ­affordable and reduces protections for the sickest patients. I seethed when the US Supreme Court unilaterally rewrote ObamaCare first in 2012 and again in 2015.

But rather than experience elation at this latest ruling, I'm seething again, and for the same reason. In Texas v. Azar, federal judge Reed O'Connor did ­exactly what Chief Justice John Roberts did at the high court: jettison the rule of law to achieve a politically desired outcome.

Cannon hardly opposes creative litigation strategies against the ACA. He and I co-authored the article upon which the legal challenges that led to King v. Burwell were based, and yet he shares my concerns about this more recent litigation.

Cannon is not alone. Here in Ohio, Attorney General Dave Yost, a conservative Republican, announced that he would be filing a brief rejecting the Justice Department's new position. As the Cleveland Plain Dealer reported:

Yost, a Republican, announced in a release that he will file a brief arguing that while the health-care reform law's controversial individual mandate is unconstitutional, other parts of "Obamacare" can and should remain in place – in particular, rules prohibiting insurance companies from denying coverage because of pre-existing conditions. . . .

Yost stated that O'Connor's reasoning in his decision was flawed, because it required him to guess whether Congress would have passed the rest of the ACA if lawmakers knew the individual mandate was unconstitutional. The attorney general argued that the judge didn't have to guess about Congress's intent, as the Republican-led U.S. House in 2017 expressly left parts of the Affordable Care Act intact when it voted to reduce the individual mandate penalty to zero.

"I do not like judicial activism in either its liberal or conservative flavors," Yost said.

Why did the Justice Department revise its position? It's a good question. According to reports in Politico and the New York Times, both Attorney General William Barr and HHS Secretary Alex Azar opposed the idea of defending Judge O'Connor's decision, but were overruled in the White House. Apparently some of the President's political advisors believe that if the law can be struck down in court, there will be a new opportunity to enact an alternative to Obamacare. It's a brazen strategy of the sort this Administration has employed in other areas, such as immigration, and seems no more likely to work. Indeed, it could even be counterproductive, particularly insofar as it undermines the Justice Department's credibility in court.

What's particularly bizarre about the Justice Department's move is that it is unlikely to alter the outcome of the litigation. However problematic the Justice Department's initial position in this litigation was, it least had the superficial plausibility that it was consistent with the Obama Adminsitration's view that the individual mandate was inseverable from the ACA's key insurance market reforms: guaranteed issue and community rating. The new position, however, lacks even this figleaf of a justification, and is likely to be viewed as nakedly political by the courts.

Professor Josh Blackman, author of two books about the legal conflicts and controversies surrounding the Affordable Care Act, Unprecedented and Unraveled, wrote in the Washington Post that the Adminstration's change of heart diminishes the stature and credibility of the Justice Department

Since the inception of the Affordable Care Act, President Barack Obama served as its legal guardian. In the span of five years, his administration defended the law before the Supreme Court in four high-profile cases. The Trump administration, however, quickly abandoned that role. In 2018, then-Attorney General Jeff Sessions argued that key portions of Obamacare were unconstitutional following the tax-cut legislation. Now, the Justice Department contends that the entire ACA must go.

The strategy is patent: Incinerate the law so a new, greater health-care reform can rise from the ashes. President Trump stated the matter bluntly: "If the Supreme Court rules that Obamacare is out, we'll have a plan that is far better than Obamacare."

In the short term, this position will have little impact on the ACA litigation. Other parties, including the House of Representatives, can defend the entire law. But in the long run, this move is counterproductive. The Justice Department has amassed a treasure trove of goodwill and credibility among federal courts over the years. But going forward, judges may be less willing to afford the executive branch this unique type of deference. Because of this hard-to-justify decision, the Trump administration will have an even harder time prevailing in other cases.

In other words, by overruling DOJ's position, the White House has done nothing to help advance its health care policy goals and may have actually made it harder to defend other administration initiatives in court. That is quite an own goal.