Justice Department urges appeals court to affirm ruling striking down ACA

Wooden gavel and gold legal scale that appear to have sunlight falling on them
The Trump administration is backing a federal judge's decision to toss the ACA. (Getty Images/William_Potter)

The Trump administration is calling for a federal appeals court to uphold a lower court decision striking down the Affordable Care Act.

The Department of Justice sent a letter (PDF) to the 5th Circuit Court on Monday, saying it has "determined the district court's judgment should be affirmed."

In the letter, DOJ said it is "not urging that any portion of the district court's decision be reversed."

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RELATED: Molina, Centene face the greatest financial exposure following ACA ruling

The legal question at the heart of the case is whether the ACA can stand on its own now that Congress has repealed one of its key elements: the individual mandate. A district court judge ruled in December that the mandate's repeal rendered the entire law unconstitutional.

U.S. District Judge Reed O'Connor of the Northern District of Texas sided with attorneys general in 20 red states, saying that the individual mandate is "essential to and inseverable from the remainder of the ACA."

"Congress stated many times unequivocally—through enacted text signed by the President—that the Individual Mandate is 'essential' to the ACA," O'Connor said in his decision. "And this essentiality, the ACA’s text makes clear, means the mandate must work 'together with the other provisions' for the Act to function as intended." 

The DOJ under President Donald Trump had declined to defend the ACA in that case, an usual move but in line with the White House's criticism of the Obama administration's signature healthcare law. Though Republicans in Congress failed to repeal the ACA, Trump signed an executive order that directs federal agencies to unwind elements of the ACA to using their regulatory power.

RELATED: Kentucky, West Virginia among states that would be hit hardest by an ACA rollback

O'Connor's ruling was roundly criticized by healthcare industry groups, who warned that it would inject uncertainty into already-troubled ACA markets and could lead to major coverage losses.

"The crushing rise in the number of uninsured patients likely to follow this decision, absent a higher court’s reversal, would push these hospitals to the breaking point," Bruce Siegel, M.D., CEO of America's Essential Hospitals, said. "Communities across the country are in jeopardy."

Conservative pundits, even some who were strong critics of the ACA, also expressed concern about the ruling, questioning its legality and warning that the judge's decision could backfire politically on Republicans, New York Magazine reported in December.

The Trump administration has continued to enforce the law as the appeals process plays out, so the decision hasn't yet significantly impacted the insurance market. The court also ruled that House Democrats can intervene in the law's defense. There have yet to be any hearings on the appeal.

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