Office of the Vermont Attorney General

Attorney General TJ Donovan, Joined by 16 AG’s, Moves to Defend the Affordable Care Act Against Federal Lawsuit Filed in Texas

April 12, 2018

Contact: Natalie Silver, (802) 595-8679

Motion to intervene seeks to protect healthcare for millions

Attorney General Donovan, joined by 16 attorneys general, Monday moved to intervene in Texas et al. v. United States et al., a lawsuit filed in federal district court in Texas which seeks to dismantle the Affordable Care Act (ACA). The Texas lawsuit imperils health care coverage and funding for all Americans, particularly more vulnerable groups like seniors, children, and people with chronic medical conditions or disabilities. The Texas lawsuit jeopardizes Medicaid funding and federal subsidies for individuals to buy private health insurance, which could lead to Vermont losing almost $3 billion in federal money over the next decade. Led by California Attorney General Becerra, a coalition of 16 states and the District of Columbia, seeks to enter the lawsuit to vigorously defend the ACA and the millions of families across the country who rely on it for affordable care.

“The ACA has directed hundreds of millions of dollars directly to Vermont to expand Medicaid coverage and subsidize the cost of Vermonters’ health insurance premiums. It has cut the number of individuals living without health insurance in Vermont nearly in half,” Attorney General Donovan said. “The ACA provides better quality and more accessible health care for Vermonters.”

According to an analysis from the Brookings Institution, an estimated 26,000 people in Vermont gained coverage between 2010 and 2015. This includes people covered through Vermont Health Connect, an estimated 5,000 young adults who gained coverage by staying on their parents’ health insurance, and those gaining coverage from the law’s Medicaid expansion and employer shared responsibility policy. This coverage would be at risk if the ACA were enjoined. The financial impact in Vermont of an injunction would also be significant. From 2019 to 2028, the State would lose an estimated $1.0 billion in federal Marketplace spending and $1.9 billion in federal Medicaid spending. Over the same period, Vermont hospitals could lose $500 million and physicians could lose $300 million. Uncompensated care costs in Vermont could increase by $2.4 billion.

The Texas lawsuit petitioned the federal court to stop Medicaid expansion; end tax credits that help people afford insurance; allow insurance companies to deny coverage to people with pre-existing conditions; take away seniors’ prescription drug discounts; strip funding from our nation’s public health system, including work to combat the opioid epidemic; and much more. If the ACA were terminated, Americans living in the states seeking to intervene could lose half a trillion dollars in healthcare funding if this lawsuit succeeded.

Texas alleges that the ACA is no longer constitutional due to the passage of the Republican tax break bill, passed in December 2017, which zeroed out the penalty payment due under the ACA’s individual mandate for those who could afford to pay for their health insurance but failed to do so.

In the motion to intervene, the attorneys general allege that the ACA has not been repealed by the passage of the Republican tax break bill, and its constitutionality has been upheld by the Supreme Court:

  • The ACA has survived nearly 70 unsuccessful repeal attempts in Congress since it was passed in 2010.
  • In National Federation of Independent Businesses v. Sebelius (2012), the Supreme Court ruled that the individual mandate is constitutional.
  • The state of Vermont and every state in the United States would suffer grave harm if the plaintiffs achieved the goals of their lawsuit.

Joining Attorney General Donovan in filing the motion are the Attorneys General of: California, Connecticut, Delaware, Hawaii, Illinois, Kentucky, Massachusetts, Minnesota, North Carolina, New Jersey, New York, Oregon, Rhode Island, Virginia, Washington, and the District of Columbia. The motion to intervene can be found here.

Last modified: April 12, 2018