November 11, 2020

Will the Supreme Court strike down the ACA? What we learned from yesterday's arguments.

Daily Briefing

    The Supreme Court on Tuesday heard oral arguments in a lawsuit seeking to strike down the Affordable Care Act (ACA) as unconstitutional, and comments from some Republican-appointed justices during the arguments suggested the Court may be likely to largely uphold the law, observers say.


    About the lawsuit

     

    In February 2018, attorneys general (AGs) from more than a dozen Republican-led states filed the lawsuit. In the suit, the AGs argue that a 2017 tax reform law rendered the ACA's individual mandate unconstitutional by zeroing out the mandate's tax penalty for remaining uninsured. That's because the Supreme Court in 2012 ruled that the mandate would be unconstitutional without a tax penalty.

    The GOP AGs also argue that the rest of ACA cannot be separated from the individual mandate, because the law does not include a severability clause stating that some parts of the law may stand if other parts are struck down. Therefore, the entire law must be invalidated if the individual mandate is struck down as unconstitutional, the Republican AGs claim. The Department of Justice (DOJ), which is supporting the lawsuit under the Trump administration, has similarly argued that the Supreme Court must strike down the entire ACA if the Court finds that individual mandate is now unconstitutional.

    In December 2018, U.S. District Judge Reed O'Connor issued a ruling in which O'Connor agreed with the Republican AGs. However, Democratic AGs who are defending the ACA in the case appealed O'Connor's ruling to the U.S. Court of Appeals for the Fifth Circuit. House lawmakers also have joined in the lawsuit to defend the ACA.

    In December 2019, a three-judge panel of the U.S. Court of Appeals for the Fifth Circuit in a 2-1 ruling also struck down the ACA's individual mandate as unconstitutional. However, the panel did not address the question of severability, and instead sent that question back to the lower court.

    Democratic AGs and the House appealed that ruling to the Supreme Court.

    The Supreme Court justices face several questions when considering how to rule in the lawsuit, including:

    • Is the individual mandate now unconstitutional?;
    • Was it Congress' intent that the rest of the ACA, or at least certain parts of the ACA, could stand without the individual mandate?;
    • Which Congress' intent should take precedent: the Congress that approved the ACA in 2010 or the Congress that approved the 2017 tax reform law?; and
    • Do the Republican AGs who filed the suit have the legal standing to sue?

    There are several ways the Supreme Court could rule in the case. The justices could:

    • Dismiss the case without ruling on any of the lawsuit's merits by deciding that the parties who filed the lawsuit do not have the legal standing to sue;
    • Strike down the individual mandate and, along with it, the entire ACA;
    • Strike down the individual mandate but allow the rest of the ACA to stand;
    • Strike down the individual mandate and certain other parts of the law that appear to be inseverable from the mandate, such as the law's protections for pre-existing conditions, but leave other portions of the law in place; or
    • Strike down the individual mandate and not rule on the question of severability at all, instead sending that question back to lower courts.

     

    Republican-appointed justices signal willingness to uphold the ACA, observers say

     

    Currently, the Supreme Court consists of six justices appointed by Republican presidents and three appointed by Democratic presidents, meaning the Court could lean conservative. Some observers have said the Court's current make up may not bode well for the ACA in the case. For the Supreme Court to issue a ruling upholding the ACA, either in full or in part, all of the Court's Democrat-appointed justices and at least two Republican-appointed justices would have to vote to uphold the law.

    According to NBC News, the Court's three Democrat-appointed justices during Tuesday's oral arguments appeared likely to favor upholding the ACA. And according to Axios, comments made by Republican-appointed Chief Justice John Roberts—who went along with Democrat-appointed justices to provide the swing vote that ultimately saved the ACA from being struck down in 2012—as well as comments made by Republican-appointed Justice Brett Kavanaugh on Tuesday indicated that they, too, may favor upholding the ACA—at least in large part.

    Kavanaugh in several comments made Tuesday suggested that he believes the individual mandate should be struck down as unconstitutional, but he also believes the rest of the ACA can remain standing.

    For instance, Kavanaugh at one point said, "I tend to agree … that it is a very straightforward case under our precedents, meaning that we would excise the mandate and leave the rest in place."

    At another point, he said, "It does seem fairly clear that the proper remedy would be to sever the mandate and leave the rest of the law in place."

    Roberts said the justices should consider lawmakers' intent when Congress passed the 2017 tax reform law, and he believes that Congress intended for the rest of the ACA to remain in place without the individual mandate penalty.

    "Here Congress left the law intact when it lowered the penalties to zero. That seems to be compelling evidence on the question," Roberts said. He added, "It's hard for you to argue that Congress intended the entire act to fall when the same Congress didn't even try to repeal the rest of the act. … I think, frankly, that they wanted the court to do that. But that's not our job."

    Republican-appointed Justice Samuel Alito also seemed skeptical of whether the Court should now strike down the entire ACA along with the individual mandate, noting differences between the case currently before the Court and the case the Court decided in 2012, Politico reports.

    In 2012, "[t]here was a strong reason to think of the mandate like a part of an airplane that was essential to keep it flying," Alito said. "But now it has been taken out, and the plane has not crashed. So how would we explain that the mandate in its present form is essential to the operation of the act?"

    The remainder of the Supreme Court's justices didn't focus as much on the question of severability during the oral arguments, and there weren't strong indications of how the rest of the Court's Republican-appointed justices might rule on severability if they decide to strike down the individual mandate, Axios reports. However, several justices—including some of the Republican-appointed justices—during the arguments posed questions regarding another aspect of the case: Do the plaintiffs who filed the suit have the legal standing to sue?

    The parties defending the ACA in the lawsuit have argued that the Republican states and two individual plaintiffs who are challenging the law haven't been harmed by zeroing out the individual mandate penalty. Therefore, they lack the standing to sue, and the Supreme Court thusly should dismiss the case, the ACA defendants claim.

    In contrast, the plaintiffs that filed the lawsuit claim that they are harmed by other portions of the law, and therefore have legal standing.

    During Tuesday's oral arguments, the Democrat-appointed Justice Elena Kagan seemed to reject the plaintiffs' argument regarding standing, saying that allowing parties to challenge an entire law based on a single provision that doesn't harm them would "kind of explode" the courts' approach to legal standing, Axios reports.


    Final outcome still unclear

     

    While the justices' comments on Tuesday makes it seem as though the Supreme Court could rule to largely uphold the ACA, it's not possible to know for sure how the Court will decide.

    "Oral arguments are not a perfect indicator of how the justices may eventually rule," Politico reports. And, as Axios notes, "[t]here have been surprises before—including in [ACA] cases."

    According to NBC News, the Supreme Court likely will issue a ruling in the case by next spring (Baker, Axios, 11/10; Luthi, Politico, 11/10;  Williams, NBC News, 11/10; Barnes et al., Washington Post, 11/10; Liptak, New York Times, 11/10).

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