Legislative Update: Recent Developments in the Federal ACA Appeal

Written by Julia Goebel | January 5, 2019

Recently we wrote about the decision by U.S. District Judge Reed O'Connor in which he found the Affordable Care Act unconstitutional. To catch up on what this means for employers and insurance producers, as well as links to the legal decision in the federal record, review our commentary published here last month.

Now to the latest development:

While Judge O'Connor's December 14, 2018 decision is reviewed by higher courts through the appeals process, O'Connor issued a stay on his own ruling, on December 30, 2018. Read on to explore what this means to employers and covered individuals.

Implications of the Ruling — and the Stay

The mid-December decision is a result of a suit brought by a coalition of states, led by Texas, challenging the 2010 Affordable Care Act. The case is Texas v. U.S., 4:18-cv-001 67, U.S. District Court, Northern District of Texas (Fort Worth).

At the core of Judge O'Connor's decision to side with Texas et al, the plaintiffs, is the legal theory that the removal of the individual mandate and penalties means that the entire law is invalidated. Of course, the analysis and ruling has nuances; we encourage reading of the 55-page decision here.

It was likely that the ruling would be appealed, but what was unclear was whether the law will remain in effect until the appeal process is completed. Judge O'Connor's stay answers this question, keeping the law in effect, while affirming his perspective that the ACA is unconstitutional. In the opinion, O'Connor writes:

 

“Because many everyday Americans would otherwise face great uncertainty during the pendency of appeal, the court finds that the Dec. 14, 2018, order declaring the individual mandate unconstitutional and inseverable should be stayed,”

— U.S. District Judge Reed O’Connor, Sunday, December 30, 2018


While the process continues, and all await the outcome, the fact remains: employers must comply with the reporting mandate for tax year 2018.

If you're using benefitexpress for ACA Compliance, then you are already covered. If not — make note of these important deadlines in order to comply [INFOGRAPHIC] and consider exploring outsourced compliance services as part of your 2019 resolution.

For more analysis and coverage on the ACA, benefits administration, outsourcing and more, subscribe to the blog today.

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Topics: Affordable Care Act, Legislative Update, ACA Compliance