20 states challenge ACA as unconstitutional

20 states challenge ACA as unconstitutional

A coalition of 20 states, led by Texas Attorney General Ken Paxton [official profile], filed a lawsuit [complaint, PDF] in the US District Court for the Northern District of Texas on Monday alleging that the Affordable Care Act (ACA) is now unconstitutional after the passing of the Tax Cut and Jobs Act of 2017 [statutes, PDF] removed the tax penalty present in the ACA.

The complaint stems from the Supreme Court’s 2012 decision in NFIB v. Sebelius [JURIST report], which found that the individual mandate requirement of the ACA was unconstitutional under the Constitution’s Commerce Clause as it exceeded Congressional authority to compel individuals to purchase health insurance. Chief Justice John Roberts, however, justified the mandate under the Constitution’s Tax and Spending Clause as Congress does have the authority to require citizens to pay taxes. Therefore, he determined the individual mandate to be a tax within their Article I authority as it generates revenue required to “to pay the debts and provide for the common defense and general Welfare of the United States.”

Relying on the four dissenting opinions in Sebelius, the complaint maintains that since the passing of the new tax plan, all that remains is the individual mandate without any accompanying exercise of Congress’ taxing power because starting in 2019, the tax penalty is eliminated by reducing the tax to $0. Without generating revenue, the claim states, “the ACA is an irrational regulatory regime governing an essential market.” It follows that “the country is left with an individual mandate to buy health insurance that lacks any constitutional basis.”

Paxton stated [press release]:

Texans have known all along that Obamacare is unlawful and a divided Supreme Court’s approval rested solely on the flimsy support of Congress’ authority to tax. Congress has now kicked that flimsy support from beneath the law. The U.S. Supreme Court already admitted that an individual mandate without a tax penalty is unconstitutional. With no remaining legitimate basis for the law, it is time that Americans are finally free from the stranglehold of Obamacare, once and for all.