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The Trump administration is asking the Supreme Court to throw out the entire Affordable Care Act. The stakes couldn’t be higher for millions of Americans who get coverage through Obamacare, and for the health care industry which has restructured itself around the 2010 law.
Marketplace’s Nova Safo has more of the details. The following is an edited transcript of his conversation with Marketplace’s Sabri Ben-Achour.
Sabri Ben-Achour: The Supreme Court previously ruled that Obamacare is constitutional. What is the Trump administration’s argument now for getting rid of it?
Nova Safo: The argument goes right back to that original Supreme Court decision which found that Obamacare was constitutional because it was a tax. People had to have coverage or pay a penalty, the so-called individual mandate.
In 2017, when the Republican-controlled Congress passed tax cuts, it effectively got rid of the individual mandate by setting the penalty for not having health insurance at zero percent.
The argument now is that since there is no penalty, then the ACA is no longer a tax, and the whole law is invalid. Now this argument prevailed in a federal district court in Texas, and that ruling was upheld in an appeal. The Justice Department also supported repeal back then at the appellate level.
Now the Supreme Court is taking up the case in its next term.
Ben-Achour: What happens if the argument prevails at the Supreme Court?
Safo: A decision likely won’t come until next year, and when it does, if there’s a repeal, it would have a lot of ripple effects.
For one, there are more than 20 million Americans insured today under the Affordable Care Act. If they lose coverage, that could cost hospitals $50 billion by one estimate.
There’s also implications for the health care industry, which as a whole is about 18% of the nation’s gross domestic product. The Economic Policy Institute estimated a loss of more than 1 million jobs if the Affordable Care Act is repealed.
I spoke this morning with Cynthia Cox, she conducts economic and policy research on the Affordable Care Act at the Kaiser Family Foundation:
“Overturning the ACA without a replacement plan in place would send the health care system into complete chaos in the midst of an unprecedented pandemic and economic downturn. Hospitals, doctors, insurance companies, pharmaceutical companies — everyone’s going to have to completely rethink how they do their business.”
Also, The ACA brought on a complex web of premium subsidies, payment structures, taxes and changes to how insurers operate.
The most famous example of that is the ban on using preexisting conditions to deny coverage. Some 130 million Americans benefit from that now, and that would go away.
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