Skip to main content
Top Button
The U.S. Supreme Court Has Agreed To Revisit the Constitutionality of  the Affordable Care Act The U.S. Supreme Court Has Agreed To Revisit the Constitutionality of  the Affordable Care Act

The U.S. Supreme Court Has Agreed To Revisit the Constitutionality of the Affordable Care Act

In issuing its decision on the constitutionality of the individual mandate under the Affordable Care Act (ACA), a 5-4 majority of the United States Supreme Court found that the individual mandate and the related penalty for failure to obtain such health coverage was a proper exercise of Congress' taxing power. After the Tax Cuts and Jobs Act of 2017 eliminated any penalty for failing to comply with the individual mandate, several states filed an action in the U.S. District Court for the Northern District of Texas taking the position that the elimination of the tax penalty meant Congress was no longer exercising its taxing power, and therefore, the individual mandate was no longer constitutional.

On December 14, 2018, the District Court issued its decision and determined the individual mandate was no longer constitutional. The Court also found the individual mandate was an essential component of the ACA, and the rest of the Act would not operate as intended without the individual mandate, so the individual mandate could not be “severed” from the rest of the ACA and the entire Act should be struck down.

The District Court's decision was appealed to the U.S. Court of Appeals for the Fifth Circuit. Oral arguments were held on July 9, 2019. The Fifth Circuit issued its long-awaited decision on December 18, 2019. In a 2-1 decision, the Fifth Circuit agreed with the District Court's decision that the elimination of the tax penalty caused the individual mandate to be unconstitutional. As a result of this decision, it seemed certain that Texas v. United States would be immediately appealed to the United States Supreme Court, likely resulting in a decision from the Court during the 2020 presidential campaign. However, the Fifth Circuit reached another decision that could have resulted in a several year delay of a “final” ruling from the Supreme Court.

The Fifth Circuit found the District Court did not conduct a thorough enough analysis of the issue of whether the individual mandate is severable from the rest of the ACA such that the entire Act did not need to be invalidated. The Appeals Court remanded the case back to the District Court for the lower court to do this analysis.

The states defending the constitutionality of the ACA filed a petition with the U.S. Supreme Court asking the Court to immediately accept certiorari of the Fifth Circuit decision. While the Supreme Court denied a request to expedite the case, the Court also denied a request to extend the deadline to respond to the petition for certiorari. 

To the surprise of many, the Supreme Court announced on March 2, 2020, that it has decided to accept certiorari of the Fifth Circuit decision. The Court did not say when it would schedule oral argument, but based on the Court's typical schedule, the oral argument will likely take place in October or November, near the time of the presidential election. Given the Court's decision, the future of the Affordable Care Act, including the pre-existing condition prohibition, guaranteed issue, coverage for adult children up to 26 and Medicaid expansion, is certain to be a hotly debated issue in the 2020 presidential campaign.

For more information, contact Taryn Stone, Kevin Woodhouse or another member of our Health Care Group.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.

View Full Site View Mobile Optimized