Texas Federal Court Rules ACA Unconstitutional–What Happens Next?

There have been several high-powered legal battles about the Constitutionality of the Affordable Care Act (ACA) ever since the Act became a law in March 2010.¹ Several of these cases have considered important Constitutional issues such as the extent of Congress’ commerce clause, necessary and proper, and tax power.² In NFIB v. Sebelius a split supreme court narrowly upheld the constitutionality of the ACA based upon Congress tax power, yet rejected arguments that the law could be sustained based on Congress commerce clause power or the necessary and proper clause.³ Resting the Constitutionality of the ACA upon a single reason left the ACA vulnerable to future legal attack. This attack came in a two-prong approach, first in the 2017 Tax Cuts and Jobs Act (TJCA) signed into law in December, 2017, the individual mandate from the ACA was repealed by Congress and signed into law by the President.⁴ It did not take long for new legal challenges to mount. One of those came quite quickly after the change in the law in the case of Texas v. U.S in the Northern District of Texas on February 26, 2018.⁵

In Texas v. U.S., the Plaintiffs allege in the Complaint that “Because this recent amendment renders legally impossible the Supreme Court’s prior savings construction of the Affordable Care Act’s core provision—the individual mandate—the Court should hold that the ACA is unlawful and enjoin its operation.”⁶ The plaintiffs filed for a preliminary injunction recently. The District Court construed the motion for a preliminary injunction as a motion for partial summary judgment and granted the Plaintiffs summary judgment on count I on December 14, 2018.⁷ This recent decision has made a major splash in the current news cycle.⁸

In the Texas v. U.S. decision, the Court did not attempt to hide the ball deep in the analysis. Instead the Court was transparent in the introduction section and presented a road map for the case.⁹ First the Court reasoned that Article III courts must decide cases or controversies presented to them, even those of the most politically charged. Second, the Plaintiffs allege “the balance of the ACA is untenable as inseverable from the Invalid Mandate.” Third, the Court’s decision is guided by the Supreme Court’s previous decision in NFIB v. Sibelius resting on the tax power only. Fourth, Congress stated the individual mandate was unequivocally “essential to the ACA”. Thus, the District Court granted summary judgment to the Plaintiffs that the ACA is now unconstitutional in totality.¹⁰

I expect the District Court’s decision in Texas v. U.S. to be immediately appealed to the Fifth Circuit. A Fifth Circuit decision will likely come within the next six months. Then the U.S. Supreme Court will likely grant certiorari on the case and oral arguments will likely be held before the end of the 2020 term of the Supreme Court.¹¹ With the current makeup of the U.S. Supreme Court, expecting the judges to maintain fairly consistent voting from the NFIB v. Sebelius case, the outcome of the ACA may once again be determined by a bare majority vote of nine unelected judges.

REFERENCES

¹ See https://libguides.law.umn.edu/c.php?g=125769&p=906254#s-lg-box-8790976

² See https://www.natlawreview.com/article/analysis-us-supreme-court-upholds-affordable-care-act-roberts-rules; Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519 (2012).

³ Id.

⁴ Pub. L. No. 115-97, 131 Stat. 2054 (2017); See https://www.smith-howard.com/2018-tax-cuts-jobs-act-overview (“the most sweeping tax legislation since the Tax Reform Act of 1986 was signed into law.”).

⁵ https://www.courtlistener.com/docket/6321938/1/texas-v-united-states-of-america

⁶ Id.

⁷ Texas v. United States, Civil Action No. 4:18-cv-00167-O, 2018 U.S. Dist. LEXIS 211547, at *11 (N.D. Tex. Dec. 14, 2018).

⁸ See https://www.npr.org/sections/health-shots/2018/09/04/644529224/whats-at-stake-in-the-latest-affordable-care-act-court-battle; https://www.reuters.com/article/us-usa-healthcare-court/federal-judge-rules-obamacare-unconstitutional-idUSKBN1OE01Y

⁹ Texas, 2018 U.S. Dist. LEXIS 211547, at *11

¹⁰0 Id.

¹¹1 See http://time.com/5482004/affordable-care-act-court-ruling/