There’s a a lot of information to digest when it comes to the latest case regarding the Affordable Care Act (ACA), so here’s our summary of the background information and some key issues.
There are a lot of big questions at play here, but the main one is, “Do the challengers have legal reasoning behind their case?”
Unfortunately, we may not know the answer to this question until the coming spring, or more probably, later in the year. While we wait, here’s what you need to know.
The case was originally filed in February of 2018. It deals with the constitutionality of the 2010 ACA, specifically the individual mandate which has a penalty of zero for not buying health insurance. Furthermore, if that mandate is unconstitutional, is it severable from the rest of the ACA? Or does everything need to go?
The argument here stems from the fact that according to the constitution, Congress is the branch with the power of taxation. Republicans who were in opposition to the tax lowered the penalty to zero when they controlled Congress in 2017, but left the rest of the ACA intact. In response to this, Republican politicians and state officials in Texas filed a lawsuit challenging the constitutionality of a so-called “tax” of zero. In opposition, California led the pack of states to defend the mandate.
The federal court sided with the Republicans, saying that because the individual mandate is no longer valid, the entire ACA must granting both California and Texas’ petition for review. Unsurprisingly, the challenging states are overwhelmingly red, and the defending states are glaringly blue.
Adding to the political intrigue of this lawsuit, Texas will be the first high-profile case of Justice Amy Coney Barrett’s career, who was recently appointed after the passing of Justice Ruth Bader Ginsburg.
So, what could happen?
Most likely, the Court will uphold the status quo. Even with no dollar penalty assigned to the tax, the healthcare marketplace has continued to function relatively normally over the last few years. In fact, nationwide premiums have been decreasing for the most part.
Alternatively, a ruling that some (or all) of the insurance reforms are irrevocably tied to the individual mandate would mean that preexisting conditions might not be protected. If the Court were to throw out all of the ACA, all insurance consumer protections, premium tax credits and many other provisions would be struck down, leaving the markets to suddenly fill the gap. In this case, more than 20 million people could lose their insurance. Most legal experts agree this is the less likely scenario, but still a real possibility.
Despite all of this conjecture on the legality of the ACA, as of today, it remains intact.
We will likely not know the Supreme Court’s decision until early next year at the absolute soonest. In the meantime, we will continue to monitor the case and provide any relevant updates.
