Inside Track: Affordable Care Act on the Ropes: U.S Supreme Court to Decide:

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  • October
    07
    2020

    Affordable Care Act on the Ropes: U.S Supreme Court to Decide

    The U.S. Supreme Court will hear a major challenge to the Patient Protection and Affordable Care Act just days after the 2020 presidential election.

    Joe Forward

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    Oct. 7, 2020 – Seven days after the upcoming election, the U.S. Supreme Court is set to hear a case challenging the Patient Protection and Affordable Care Act of 2010 in its entirety, a case that pits many Red states against Blue states in an election year.

    One of the first major questions is: Who will be deciding the case in Texas v. California? The recent death of U.S. Supreme Court Associate Justice Ruth Bader Ginsburg has triggered a race to confirm President Donald Trump’s nominee, Amy Coney Barrett.

    Barrett is currently a judge on the U.S. Court of Appeals for the Seventh Circuit. The U.S. Supreme Court last heard a major challenge to the Affordable Care Act in 2012.

    In the 2012 decision, the court (5-4) upheld the constitutionality of the individual mandate – which required people to purchase health insurance or pay a tax penalty – under Congress’ taxing power. Chief Judge John Roberts was in the majority.

    But Congress set the penalty at zero in 2017, which set up the current lawsuit. Texas and other coalition states argue that the individual mandate, at zero, can no longer be considered a tax and is thus unconstitutional. Without the individual mandate, the challengers argue, the entire Affordable Care Act (ACA) is invalid and unenforceable.

    The U.S. Court of Appeals for the Fifth Circuit upheld (2-1) a district court ruling that the ACA’s individual mandate is unconstitutional because it can no longer be read as a tax.

    But the Fifth Circuit Court of Appeals remanded the case on the issue of severability, that is, whether other parts of the ACA can still stand without the individual mandate. At that point, California et al. appealed the case directly to the U.S. Supreme Court.

    The question will now be decided by a U.S. Supreme Court, with oral argument scheduled for Nov. 10, 2020. The court will decide the case without Justice Ginsburg, part of the five-justice majority that upheld the ACA’s individual mandate in 2012.

    Maneuvering Health Care Policy

    The ACA’s fate may be decided in the coming months, but the health care legislation enacted in 2010 under President Barack Obama was on shaky ground at its inception.1

    Joe ForwardJoe Forward, Saint Louis Univ. School of Law 2010, is a legal writer for the State Bar of Wisconsin, Madison. He can be reached by org jforward wisbar email or by phone at (608) 250-6161.

    When enacted, the law was expected to expand health insurance coverage to 30 million people who could not afford it otherwise, through an expansion of Medicaid, cost-sharing subsidies in the private insurance market, and growth in Medicare enrollment.

    Since enactment, various events have changed the ACA’s original scope – including lawsuits, executive orders, and new legislation – but the law is still intact a decade later.

    However, the success of this historic health care law required political maneuvering in a divisive political climate to surmount opposition, not unlike previous reform efforts.

    President Lyndon B. Johnson, who took office when President John F. Kennedy was assassinated, won a landslide victory to secure the presidency in 1964 and continued to push Medicare as an expansion of the safety net provided by Social Security.

    In addition, Democrats took commanding control of both houses of Congress, allowing maneuvers to sidestep opposition to enact Medicare in 1965. Medicare – available primarily to seniors over age 65 – serves more than 40 million people in the U.S.

    President Bill Clinton’s attempts at health care reform failed in the 1990s, but President George W. Bush was successful – through then-Health and Human Services Secretary Tommy Thompson – in enacting prescription drug coverage for Medicare beneficiaries.

    ACA Enacted

    After passing the U.S. House of Representatives, the Affordable Care Act (ACA) passed on party line votes in the Senate after 25 days of debate, on Christmas Eve in 2009. But the Senate bill required reconciliation with the House bill that passed.

    Passage seemed likely until Scott Brown, a Republican from Massachusetts, was elected in a special election to fill the seat of the late Senator Edward Kennedy of Massachusetts, a Democrat.

    A Democrat had been appointed to temporarily replace Kennedy, preserving a crucial Senate vote on health reform on Christmas Eve, but Brown defeated a Democratic challenger in a special election. Thus, Democrats ultimately employed existing budget procedures that allowed reconciliation without a supermajority of 60 votes in the Senate.

    The final version of the Affordable Care Act passed on party-line votes. The strictly partisan nature of enactment meant the Affordable Care Act stood on shaky ground.

    Julie Rovner, the chief Washington Correspondent for Kaiser Health News recently noted that the first major ACA lawsuit was filed the same day President Obama signed the law and the ACA has been “under some threat of lawsuit” for its entire existence.

    As lawsuits challenging the ACA mounted, so did a Republican “repeal and replace” effort, which ultimately failed in 2017 when the late Senator John McCain (R-Arizona), gave a thumbs-down and two other Republicans voted against repeal and replace.

    Now the ACA faces another test: The U.S. Supreme Court will hear Texas v. California, with several unknowns, primarily, whether Judge Barrett will be seated for the case or whether it will be heard by eight justices instead of nine.

    The Court was shorthanded for more than a year after the death of Justice Antonin Scalia during Obama’s tenure in February 2016. Republicans blocked Obama’s nomination and Neil Gorsuch, a Trump nomination, was confirmed in April 2017.

    Severability is a Primary Issue

    The so-called “severability doctrine” is the primary issue in Texas v. California: whether the ACA can survive if a major piece, the individual mandate, is not a tax and therefore unconstitutional. California et al. notes the ACA is still standing with the penalty at zero.

    “On the one hand, invalidating an entire statute for one faulty piece is the most invasive of remedies; on the other, the court is wary of altering Congress’ laws by excising parts of them,” wrote Abbe Gluck for SCOTUSblog. “The severability doctrine takes a side: It presumes Congress wants its statutes saved.”

    Gluck, a Yale law professor, noted that this past term, the Court employed the severability doctrine to excise provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act to preserve the Consumer Financial Protection Bureau. It also used the doctrine to save major provisions of the Telephone Consumer Protection Act.

    “Those two cases may be preludes to a bigger severability battle next term, as the court may have to apply the doctrine to decide the fate of the Affordable Care Act,” she noted.

    But Gluck also notes that some laws have express severability clauses that say the law should remain intact if any provision of the act is held unconstitutional. The ACA does not, but Congress left the ACA intact when it repealed the individual mandate in 2017.

    “The DOJ and Texas, however, argue that Congress has spoken against severability,” Gluck explained. “They argue that the mandate is inextricably intertwined with some of the ACA’s significant reforms to private insurance, including the prohibition against discrimination based on pre-existing health conditions.”

    The State of Wisconsin is not a party to Texas v. California, but any decision will have a nationwide impact on health care in America.

    Endnotes

    1 John Cannan, A Legislative History of the Affordable Care Act: How Legislative Procedure Shapes Legislative History, Law Library Journal (2013).




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