Jan. 3, 2020 – A late-December ruling from the U.S. Court of Appeals for the Fifth Circuit agreed with the U.S. District Court in Texas that the Affordable Care Act’s (ACA’s) individual mandate – which was premised on Congress’ taxing authority – was rendered invalid when the 2017 tax bill set the tax penalty at zero, but also said that the lower court failed to make a detailed argument regarding why the entire ACA is unconstitutional if the individual mandate is unconstitutional. The Fifth Circuit asked the lower court to “conduct a more searching inquiry” which likely will delay any final decisions on the fate of the ACA until after the 2020 presidential election.
“The Circuit Court’s decision has several effects,” noted Coalition for Healthcare Communication Executive Director Jon Bigelow. “First, it means that for now, the ACA stands; there will be no immediate disruption in insurance coverage for millions of Americans who rely on it. Second, it means key ACA provisions that go beyond health insurance, such as the Sunshine Act, remain in force. Third, it makes it difficult to appeal the case at this time to the U.S. Supreme Court, and thus probably means the case would not be heard by the Supreme Court this winter or decided by June, in the middle of the election season.
“After the 2020 elections, whatever the outcome, the debate will be changed,” Bigelow continued. “If there is a decisive Republican victory, there will be pressure to end Obamacare anyway, whereas if there is a decisive Democratic victory, Congress would be more likely to correct any constitutional issues with the ACA or perhaps replace it with a Medicare for All program.”
The Fifth Circuit’s 2-1 decision, while siding with the U.S. District Court for the Northern District of Texas that an ACA requirement that individuals have health insurance was unconstitutional, did not state that the ACA itself was unconstitutional. The court said that the Trump administration had been inconsistent in its positions in arguing its case, and asked that U.S. District Court Judge Reed O’Connor defend his decision that the ACA in its entirety had to fall if the individual mandate fell.
One specific issue that needs to be addressed by Judge O’Connor is “severability” – a legal doctrine holding that when a court severs one provision of a statute, it should leave the rest of the statute in place unless Congress specifically states that that statute is utterly dependent on the severed provision.
It could take up to a year for Judge O’Connor to issue a new ruling, particularly because The New York Times reported Dec. 19 that “the federal government will be staking a new stance [when it re-argues the case], since it now supports striking down the full A.C.A., a different position from its original one.”
California Attorney General Xavier Becerra and other Democratic states asked the Supreme Court on Jan. 3 to consider the case for expedited review, in the hopes that the matter might be settled before the November 2020 election. It is unlikely – although not impossible – that the Supreme Court would hear the case before the lower courts rule again on this case; five Supreme Court justices would have to agree to hear the appeal.