What Obamacare ruling could mean for your health care

What Obamacare ruling could mean for your health care

What Obamacare ruling could mean for your health care

A Texas federal judge dealt a serious blow to the Affordable Care Act (ACA) late Friday afternoon, ruling that the tax reform law passed by Congress in late 2017 rendered the healthcare law unconstitutional.

U.S. District Judge Reed O'Connor in Fort Worth agreed with a coalition of Republican states led by Texas that the Affordable Care Act, the signature health-care overhaul by President Barack Obama, needed to be eviscerated after Congress a year ago zeroed out a key provision - the tax penalty for not complying with the requirement to buy insurance.

He said the U.S. Supreme Court's conservative wing has been skeptical in the past of striking down entire laws because of a single problematic provision, and at least a bare majority of five justices would likely agree that O'Connor was wrong.

"They are asking the court to evaluate the current law on the basis of what the law used to be", Jonathan Adler, a law professor at Case Western University who supported previous Obamacare challenges, has told Vox.

Centene Corp fell 7.8 percent to US$117.5 (S$161.4), while Molina Healthcare slumped 10.1 percent to US$118.4.

The S&P 500 Managed Care Index fell 2.3 percent to the lowest since October 29, led by Centene, WellCare, Anthem and Cigna.

The decision came just hours before the end of open enrollment for ACA plans in most states that use the federal healthcare.gov insurance exchange. But with that "tax" - or penalty - having been removed starting next year, Republicans challenging the law in this case argued the program is now illegal.

For the next several weeks, then, health care and health insurance will be at the top of America's legal, legislative and political agendas. Republicans, including President Donald Trump, have long criticized the law, calling it a costly and unneeded government intrusion into Americans' lives.

Total enrollment is on track to be lower than in previous years, which many critics have credited to efforts by the Trump administration to promote alternatives to the law or cut back on its promotion.

The states challenging the law were led by Texas Attorney General Ken Paxton and Wisconsin Attorney General Brad Schimel, both Republicans.

Henneke added states should prioritize "market-based solutions but also regulations that will provide for choice".

Even in case of an eventual injunction, the defendants would certainly seek and most likely get a stay pending appeal, Evercore said.

"The ACA has already survived more than 70 unsuccessful repeal attempts and withstood scrutiny in the Supreme Court", said a statement from California Attorney General Xavier Becerra.

Most legal experts do not believe the Supreme Court would ultimately strike down the entire law, but the uncertainty could pressure stocks in the near term, brokerage Oppenheimer said.

The Supreme Court in 2012 ruled that the individual mandate was a valid exercise of Congress' taxation powers, with the law imposing a monetary penalty on people who did not obtain insurance. The reasoning? That it's within Congress' purview to impose tax penalties.

Barack Obama reminded people that Saturday is the final day to enroll for Obamacare in 2019 and claimed that the significance of the ruling has been overstated. But with appeals certain, even the Trump White House said the law will remain in place for now. Insurers are still forbidden from denying coverage or charging higher premiums for people with pre-existing conditions.

The Texas judge was not constrained by these recommendations and concluded that the penalty's elimination had a much more profound impact, the effect of which could a host of other health coverage issues, including Medicaid expansion; annual and lifetime coverage limits; the employer coverage mandate; federal health care reimbursement rates for hospitals; coverage for adults up to age 26 under their parents' plan; and caps on out-of-pocket costs.

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