December 18, 2018

ACA Still in Effect

On December 14, 2018 a federal district court in Fort Worth ruled that the ACA’s requirement to maintain minimum essential coverage (the so-called individual mandate) was unconstitutional . The court further ruled that the remaining provisions of the ACA were so closely connected to the individual mandate that they too are invalid.  Both liberal and conservative legal scholars have raised questions about the court’s reasoning and the decision is certain to be appealed.

In the meantime, employers are left to wonder what, if anything, they can or should do as a result of this decision.  While the court declared the ACA unconstitutional, it did not issue an order enjoining its enforcement.  It has been widely assumed that the law continues to be in effect.  In fact, both the White House and the Centers for Medicare & Medicaid Services have issued statements that the government will continue to comply with the law, pending appeal.

Regardless, there has been sufficient confusion about this that the defendants (the ones supporting the ACA) in the Texas case filed a motion on December 18, 2018, asking the court to clarify its opinion by issuing an order stating that the rights and obligations of all parties under the ACA remain in effect until the completion of all appellate review.  Alternatively, the defendants have asked the court to enter an order staying any effect of its ruling pending appeal.  The defendants have requested that the court rule promptly on their motion but there is no guarantee that the court will do so.

As a practical matter, it appears that employers would be well advised to sit tight and await further developments before modifying their health plans as a result of this decision.

Compliancedashboard® will keep you updated as more information becomes available.

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