Shares of health insurers, hospital operators fall as Obamacare ruled unconstitutional

Shares of health insurers, hospital operators fall as Obamacare ruled unconstitutional

Shares of health insurers, hospital operators fall as Obamacare ruled unconstitutional

The ACA, introduced by former US President Barack Obama in 2010 to provide affordable healthcare to all Americans, mandates that all individuals have health insurance or pay a tax.

"It's time to get started now, not to wait for the ultimate outcome of this case", Rob Henneke, general counsel with the Austin-based Texas Public Policy Foundation, said in a call with reporters Monday morning.

The case is "still moving through the courts", said the message from the federal Centers for Medicare and Medicaid Services.

A federal judge in Texas has struck down the whole of the Affordable Care Act, also known as "Obamacare", as unconstitutional. The law also protects people with pre-existing conditions and allows people up to age 26 to be covered under their parents' insurance; requires calorie counts at restaurants and gives protections to lactating mothers.

This Oct. 23, 2018, file photo shows website on a computer screen in NY.

Since the individual mandate penalty was dropped to $0, the Supreme Court's ruling of the law is now a different one than was upheld by the U.S. Supreme Court, the judge reasoned.

But if the latest legal challenge to ObamaCare ends up before the Supreme Court, the outcome is far from certain.

U.S. District Judge Reed O'Connor in Fort Worth sided with the argument put forward by a coalition of Republican-leaning states, led by Texas, that the Affordable Care Act could no longer stand now that there's no penalty for Americans who don't buy insurance.

Congress had reduced the tax penalty to zero in tax changes last December.

In all, 11.8 million people in all 50 states signed up for health insurance through the law's marketplaces for 2018. He concluded it is "impermissible under the Interstate Commerce Clause-meaning the Individual Mandate is unconstitutional". Health insurers could also drop, but some of that may be priced in because they fell ahead of the ruling, he said. Leerink analyst Ana Gupte expects the judge's decision will be overturned either by the Fifth Circuit Court of Appeals next year or the Supreme Court in 2020. If you have an Obamacare plan, it remains valid and any premium subsidy received will continue. Before the legislation became law, insurers could reject those with pre-existing conditions or charge them higher rates. Opponents of the suit have vowed to appeal.

The appeals process is expected to take some time, potentially as long as two years. At the same time, they have voted to fund the Pentagon's $717 billion budget to pursue the United States military's criminal interventions across the globe.

"Today's ruling is an assault on 133 million Americans with preexisting conditions, on the 20 million Americans who rely on the ACA's consumer protections for health care, and on America's faithful progress toward affordable health care for all Americans", California Attorney General Xavier Becerra said in a statement.

Trump is pushing for $5 billion to help make good on his marquee campaign promise of a U.S. -Mexico border wall, a request that Democrats are resisting as part of negotiations over a larger budget deal. Republicans were unsuccessful at repealing and replacing the law in 2017 when they controlled both chambers and the White House.

Thus, everyone involved in the lawsuit and everyone affected by Obamacare will be paying attention to what happens in the courts.

However, the ruling has created uncertainty about the future of the ACA, even as many legal experts question O'Connor's reasoning and predict the ruling will get tossed out upon appeal.

Democratic Rep. Joe Kennedy said "they found one judge to agree, and now Medicaid expansion could be gone, pre-existing condition protections could be wiped out, prices skyrocket and millions lose insurance".

According to Bloomberg, shares for managed health company Molina Healthcare dropped up to 13.5%, its lowest dip since February 2017.

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