Judge Reed O’Connor’s ruling came after Texas Attorney General Ken Paxton’s office filed a lawsuit along with a coalition of 17 other state attorneys general. The lawsuit argues that the repeal of the individual mandate in the Tax Cuts and Jobs Act of 2017 (technically the mandate’s penalty was changed to zero) means that the entirety of Obamacare should be struck down on the grounds that the mandate is inseparable from the rest of the law.
Last Wednesday, in a move that may bolster Paxton’s efforts, the U.S. Department of Justice asked the Fifth Circuit Court of Appeals to side with Texas and overturn Obamacare.
The Texas lawsuit stems from a Supreme Court opinion issued in 2012 by Chief Justice John Roberts in National Federation of Independent Business (NFIB) v. Sebelius. That case saw twenty-six states file suit against the Obama Administration arguing that the individual mandate was unconstitutional.
Chief Justice Roberts stated then that, “The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce (NFIB v Sebelius pg 3).”
Roberts ultimately wrote the majority opinion that found the penalty imposed by the individual mandate “may for constitutional purposes be considered a tax (NFIB v Sebelius pg 4).”
The end result was the Supreme Court effectively upheld Obamacare as constitutional when Chief Justice Roberts redefined the mandate as a tax.
Therefore, the current lawsuit brought forward by Texas argues that since the mandate was repealed, then Chief Justice Robert’s ruling in NFIB v. Sebelius means the entirety of the law should now be struck down.
The Texas Attorney General’s Office responded to an inquiry from the Texan about the suit.
“Congress meant for the individual mandate to be the centerpiece of Obamacare. Without the constitutional justification for the centerpiece, the law must go down,” Attorney General Paxton said. “Obamacare is a failed social experiment. The sooner it is invalidated, the better, so each state can decide what type of health care system it wants and how best to provide for those with preexisting conditions, which is federalism that the Founders intended.”
A coalition of 21 states led by California Attorney General Xavier Becerra is fighting Judge O’Connor’s decision. Becerra said the ruling “threatens the entire healthcare system in the United States of America.”
The California Attorney General’s Office released a statement in January on the lawsuit saying in part, “This shouldn’t be a debate; the ACA has been the law for nearly a decade and is the backbone of our healthcare system. This case impacts nearly every American – workers covered by employers, families, women, children, young adults, and seniors – so we will lead the ACA’s defense as long and far as it takes.”
The American Medical Association (AMA), which has supported Obamacare since its inception, also supports California’s efforts, stating on its website that, “if the district court’s ruling were to stand, many important and broadly supported patient protections provided by the ACA would be eliminated.”
David Balat, Director of Right on Healthcare at the Texas Public Policy Foundation (TPPF), told the Texan that, “The ACA has done more to harm the average American. We have seen premiums go up by three [times], the cost of drugs…Anytime you see the government get involved in regulating an industry or running an industry, you see an increase in cost, much like what we have seen in higher education.”
A 2017 report by the federal Department of Health and Human Services showed that premiums had more than doubled on average since the implementation of Obamacare.
“We had smaller deductibles prior to the ACA. It has done more harm to the healthcare industry,” said Balat.
Rob Henneke, General Counsel and Director of the Center for the American Future at TPPF, is the lead counsel for the individual plaintiffs listed in Texas v. USA. He expects the case to go before the Fifth Circuit Court of Appeals sometime this July.
Henneke predicts that whichever side loses will seek en banc, a session in which a case is heard before all the judges of a court.
That could ultimately lead to a review by the Supreme Court sometime next year, just in time to become a major factor in the 2020 presidential elections.
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