Affordable Care Act survives again as SCOTUS rejects third challenge

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Joseph Burns (@jburns18), a Massachusetts-based independent journalist, is AHCJ’s topic leader on health insurance. He welcomes questions and suggestions on insurance resources and tip sheets at joseph@healthjournalism.org.

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Ruling 7-2 on Thursday in a challenge that Texas and other states brought against the Affordable Care Act, the U.S. Supreme Court found the plaintiffs lacked the legal standing to bring the lawsuit.

“The decision preserves health insurance subsidies for more than 20 million Americans and protections for tens of millions more whose preexisting medical conditions could otherwise prevent them from obtaining coverage,” as David G. Savage explained in an article for The Los Angeles Times.

In his coverage, Savage includes a good rundown of the history of the case, California vs. Texas, calling it, “… a battle of red states against blue states, driven by elected state attorneys.” Other Republican-led states joined the Texas lawsuit along with the federal Department of Justice under former president Trump. On the other side of the case, former California Atty. Gen. Xavier Becerra filed suit to defend the law, and other Democratic-led states and the U.S. House of Representatives joined the case with him.

In March, Becerra was confirmed as secretary of the federal Department of Health and Human Services (HHS), where he oversees the Biden’s administration’s efforts to expand enrollment in the ACA. We outlined those efforts in previous blog posts in February, March and April.

On June 5, HHS announced the ACA had achieved a record of 31 million Americans enrolled since the law went into effect in 2014. The 31 million figure includes the number of Americans who have enrolled in the ACA on the federal marketplace serving 36 states (at www.healthcare.gov), in the other ACA marketplaces that 14 states operate, and in other health insurance programs such as Medicaid. The ACA allows all states to expand enrollment in the state and federal Medicaid program.

“The enactment of the Affordable Care Act in 2010 was the largest expansion of coverage in the U.S. health care system since the passage of Medicare and Medicaid in 1965,” the HHS report said.

In a thorough review of the SCOTUS ruling, Amy Howe explained on the ScotusBlog that the justices did not reach a decision on the main issue in the case: whether the entirety of the ACA was rendered unconstitutional when Congress eliminated the penalty for failing to obtain health insurance. In 2017, Congress voted to change that penalty from $695 to $0.

In a 54-page decision, the court found that neither Texas nor the other states nor the two individuals who challenged the mandate had standing, meaning a legal right to sue, Howe added.

Those voting to uphold the law were Justices Amy Coney Barrett, Stephen Breyer (who wrote the majority opinion), Elena Kagan, Brett Kavanaugh, John Roberts, Sonia Sotomayor and Clarence Thomas. The two dissenting justices were Samuel Alito (who wrote the dissent) and Neil Gorsuch.

The individuals who joined Texas and the other states as plaintiffs contended they had been harmed and, thus, have a right to sue because people in those states need to pay for health insurance to comply with the mandate, Howe wrote. “The problem with that argument, Breyer reasoned, is that although the ACA instructs them to obtain health insurance, the Internal Revenue Service can no longer impose a penalty on taxpayers who fail to obtain insurance, and there is no other government action connected to the harm that the individual plaintiffs claim to have suffered, a key requirement for standing,” she added.

The decision marks the third time since Congress passed the ACA in 2010 that the court has upheld the law, as Ian Millhiser wrote for Vox. He called the ruling “an unusually dismissive opinion.” The two previous cases were National Federation of Independent Business v. Sebelius in 2012 and King v. Burwell in 2015.

“The brief court’s decision in California v. Texas, issued Thursday, ultimately concludes that the plaintiffs trying to undo the law had no business being in court in the first place,” Millhiser wrote.

For Politico, Susannah Luthi and Josh Gerstein wrote that the decision “…may serve as the final chapter in the decade-long legal assault on Obamacare, arriving as President Joe Biden seeks to build on the law’s coverage provisions.”

For a deeper dive into the ruling, see what Mark Joseph Stern wrote about it for Slate. “Sometimes, when the court finds no standing, the plaintiffs can retreat, develop a new theory of harm, and return with a beefed up lawsuit,” he commented. “But look closer at the decision in California v. Texas and you will see a wholesale rejection of the plaintiffs’ entire theory of the case. Other attacks on Obamacare will continue, but this uniquely daffy assault on the law is dead.”

2 thoughts on “Affordable Care Act survives again as SCOTUS rejects third challenge

  1. Dan Keller

    SCOTUS typically makes rulings on cases based on the narrowest grounds possible. Conservatives typically object to “judicial activism” and assert that legislatures should make laws, not (in effect) the courts. So in this case it was ironic but not surprising that Justices Gorsuch and Thomas, two Conservatives, wanted the Court to make a more sweeping ruling on the ACA. A further irony was that the “solution” that the Republican Congress chose in order to negate the ACA was to zero out the penalty under the mandate to buy insurance, but in so doing, they inadvertently took away the basis for bringing suit based on the supposed harm inflicted by the mandate. So, no cost –> no harm –> no standing. It was a loophole that I suspect they had no idea at the time that they created, or at the least, that they hoped no future court would base a decision on.

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