In a brief filed in a federal court in Texas, the department said a tax law signed a year ago by President Donald Trump that eliminated penalties for not having health insurance rendered the so-called individual mandate under Obamacare unconstitutional. And the Justice Department says it agrees with those states, and it will not defend some of the key remaining provisions in the law.
The ACA individual major medical insurance mandate provision originally required people who failed to get covered to pay a penalty. United States argue that this rationale, such as it was, no longer applies because Congress reduced the tax-penalty to zero a year ago. Such provisions include protecting people with pre-existing medical conditions from being charged more or being denied coverage. But in this instance it agrees with the state that the individual mandate and other requirements should be deemed illegitimate as of January 1, 2019.
Meanwhile, California and several other states filed a motion to intervene to defend the law. It requires insurance companies to cover people with preexisting conditions - charge them the same rates as everybody else?
"The Department in the past has declined to defend a statute in cases in which the president has concluded that the statute is unconstitutional and made manifest that it should not be defended, as is the case here", Sessions wrote.
Obamacare's protections for those with pre-existing conditions are overwhelmingly popular, with 70 percent of respondents to a recent Kaiser Family Foundation poll supporting that part of the health-care law.
As many as 130 million adults under age 65 in the US have pre-existing conditions that could result in their not being able to get insurance coverage in the private market, according to the Department of Health and Human Services.
The Justice Department lawyers representing Trump's U.S. Department of Health and Human Services and Trump's Internal Revenue Services have asked the court to narrow the scope of the suit, and then to grant a ruling in favor of Texas and its allies on the narrower version of the suit. One of their replacements is Brett Shumate, described by the Times as "a Trump administration political appointee in the civil division of the Justice Department who has played a leading role in defending the White House in a range of lawsuits". Under another provision, the community rating provision, insurers were not allowed to set premiums based on a person's health history.
"Tonight, as the president and his administration launch their most unsafe sabotage effort yet, we are seeing just how far Republicans are willing to go in their quest to undermine the American health care system", said Brad Woodhouse, campaign director of Protect Our Care, an advocacy group staffed with many Obama administration alums. "Once the heart of the ACA - the individual mandate - is declared unconstitutional, the remainder of the ACA must also fall".
Some critics of the administrations decision said California should go forward with enacting its own mandate for individual coverage, as a few other states have done. Health insurers are now deciding whether to sell coverage in the individual market in 2019 - and what they're going to charge. Rather, it argued that without the tax to encourage healthy people to sign up, the parts of the law guaranteeing coverage to people who have chronic illnesses or other pre-existing health conditions should be struck down as well.
"The more uncertainty there is, the more the actuaries are going to be plugging into their projections for premium rates", says Sabrina Corlette, a research professor at Georgetown University's Health Policy Institute.
"Final resolution of this case will take time, given that the litigation is in its preliminary stages at the district court, and any ruling will be subject to appeal". But it does certainly raise the prospect of a court decision that would say there could be no more protections for people with preexisting conditions.
And though the federal government will apparently no longer defend a pillar of the law, a group of left-leaning states have stepped in to back it in court.
"If the Justice Department can just throw in the towel whenever a law is challenged in court, it can effectively pick and choose which laws should remain on the books", writes University of MI law professor Nicholas Bagley.