Those wondering when the U.S. Court of Appeals for the Fifth Circuit would decide Texas v. United States, the latest challenge to the Affordable Care Act (ACA) need wonder no longer, as the opinion was released this afternoon. In short, a divided panel decided that the courts have jurisdiction to hear the case and the appeal, the individual mandate is unconstitutional because Congress’ decision to zero out the penalty means that it may no longer be construed as a tax, and that the question of severability is complex and difficult and must be reconsidered by the district court.
Judge Elrod wrote for the panel, joined by Judge Englehardt. Judge King dissented.
Judge Elrod’s opinion for the court begins:
The Patient Protection and Affordable Care Act (the Act or ACA) is a
monumental piece of healthcare legislation that regulates a huge swath of the
nation’s economy and affects the healthcare decisions of millions of Americans.
The law has been a focal point of our country’s political debate since it was
passed nearly a decade ago. Some say that the Act is a much-needed solution
to the problem of increasing healthcare costs and lack of healthcare
availability. Many of the amici in this case, for example, argue that the law
has extensively benefitted everyone from children to senior citizens to local
governments to small businesses. Others say that the Act is a costly exercise
in burdensome governmental regulation that deprives people of economic
liberty. Amici of this perspective argue, for example, that the Act “has deprived
patients nationwide of a competitive market for affordable high-deductible
health insurance,” leaving “patients with no alternative to . . . skyrocketing
premiums.” Association of American Physicians & Surgeons Amicus Br. at 15.
None of these policy issues are before the court. And for good reason—
the courts are not institutionally equipped to address them. These issues are
far better left to the other two branches of government. The questions before
the court are far narrower: questions of law, not of policy. Those questions are:
First, is there a live case or controversy before us even though the federal
defendants have conceded many aspects of the dispute; and, relatedly, do the
intervenor-defendant states and the U.S. House of Representatives have
standing to appeal? Second, do the plaintiffs have standing? Third, if they do, is the individual mandate unconstitutional? Fourth, if it is, how much of the
rest of the Act is inseverable from the individual mandate?
We answer those questions as follows: First, there is a live case or
controversy because the intervenor-defendant states have standing to appeal
and, even if they did not, there remains a live case or controversy between the
plaintiffs and the federal defendants. Second, the plaintiffs have Article III
standing to bring this challenge to the ACA; the individual mandate injures
both the individual plaintiffs, by requiring them to buy insurance that they do
not want, and the state plaintiffs, by increasing their costs of complying with
the reporting requirements that accompany the individual mandate. Third,
the individual mandate is unconstitutional because it can no longer be read as
a tax, and there is no other constitutional provision that justifies this exercise
of congressional power. Fourth, on the severability question, we remand to the
district court to provide additional analysis of the provisions of the ACA as they
currently exist.
Judge King’s dissent begins:
Any American can choose not to purchase health insurance without legal
consequence. Before January 1, 2018, individuals had to choose between
complying with the Affordable Care Act’s coverage requirement or making a
payment to the IRS. For better or worse, Congress has now set that payment
at $0. Without any enforcement mechanism to speak of, questions about the
legality of the individual “mandate” are purely academic, and people can
purchase insurance—or not—as they please. No more need be said; it has long
been settled that the federal courts deal in cases and controversies, not
academic curiosities.
The majority sees things differently and today holds that an
unenforceable law is also unconstitutional. If the majority had stopped there,
I would be confident its extrajurisdictional musings would ultimately prove
harmless. What does it matter if the coverage requirement is unenforceable by
congressional design or constitutional demand? Either way, that law does not
do anything or bind anyone.
But again, the majority disagrees. It feels bound to ask whether
Congress would want the rest of the Affordable Care Act to remain in force now
that the coverage requirement is unenforceable. Answering that question
should be easy, since Congress removed the coverage requirement’s only
enforcement mechanism but left the rest of the Affordable Care Act in place. It
is difficult to imagine a plainer indication that Congress considered the
coverage requirement entirely dispensable and, hence, severable. And yet, the
majority is unwilling to resolve the severability issue. Instead, it merely
identifies serious flaws in the district court’s analysis and remands for a doover, which will unnecessarily prolong this litigation and the concomitant
uncertainty over the future of the healthcare sector.
I would vacate the district court’s order because none of the plaintiffs
have standing to challenge the coverage requirement. And although I would
not reach the merits or remedial issues, if I did, I would conclude that the
coverage requirement is constitutional, albeit unenforceable, and entirely
severable from the remainder of the Affordable Care Act.
(developing. . . will continue to update).
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