Federal appeals court rules ACA individual mandate unconstitutional but declines to strike down entire law News
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Federal appeals court rules ACA individual mandate unconstitutional but declines to strike down entire law

The US Court of Appeals for the Fifth Circuit on Wednesday ruled the individual mandate of the Affordable Care Act (ACA) is unconstitutional but declined to strike down the entire law. Instead, the 2-1 ruling remanded the question of severability (whether the ACA can remain legal without the individual mandate) back to the original district court.

When the constitutionality of the ACA was originally contested, the Supreme Court upheld the ACA under Congress’ authority to tax. The court framed the individual mandate as a “tax” on individuals who do not have health insurance and reasoned that Congress had the ability to regulate health policy on the federal level through such taxation powers. In the opinion, the court stated that the individual mandate was an essential part of the ACA, and therefore the court was inclined to read the provision constitutional.

However, in 2017 the Trump administration passed the Tax Cuts and Jobs Act. In the law, the individual mandate penalty within the ACA was decreased to $0.00. While the Tax Cuts and Jobs Act did not technically remove the individual mandate, it did render it ineffective.

As a result, the following case was brought by individuals within the state of Texas, contesting the requirement to buy health insurance. Despite the penalty being reduced to $0.00, the plaintiffs argued they were still compelled to buy insurance that was more costly in order to comply with the laws of the ACA. State intervenors further argued that the reduction of the penalty no longer made the individual mandate tax-like. Without this “tax,” Congress no longer had the authority to impose the individual mandate rendering the provision unconstitutional. And since the mandate was so crucial to the ACA’s function, the provision was not severable from the ACA and the whole law must be struck down.

The district court judge agreed with the plaintiffs and ruled the entire ACA unconstitutional. In the appeal, Democratic states intervening in support of the ACA argued the intent of Congress was clear to retain the ACA despite the lack of an individual mandate.

In the Fifth Circuit’s opinion, the judges agreed with the District Court: “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.” The court also determined that both groups of states in the case have standing. However, on the issue of severability, the court declined to rule and instead remanded the case back to the district court.

Judge Jennifer Walker Elrod wrote that the matter of severability “involves a challenging legal doctrine applied to an extensive, complex, and oft-amended statutory scheme,” therefore requiring a more detailed review offered at the district court level.