Recently, the U.S. Department of Justice (DOJ) argued in court in favor of striking down the Affordable Care Act (ACA). In front of the federal appeals court, the DOJ argued that the removal of the individual mandate provision from the ACA renders the entire law unconstitutional. The brief supports the ruling issued by a Texas federal court that declared the ACA unlawful after a challenge by Texas and other Republican-majority states.
DOJ’s Arguments Against the ACA
The DOJ relies on the U.S. Supreme Court ruling, National Federation of Independent Business v. Sebelius, which upheld the individual mandate. The mandate was a provision of the ACA that leveraged a penalty on anyone who did not buy health coverage, and the U.S. Supreme Court argued that this mandate and penalty was Congress exercising their power of taxation.
However, without the individual mandate provision of the ACA, the DOJ argues, the entire law is unconstitutional and invalid. In fact, the Tax Cuts and Jobs Act of 2017 (“TCJA”) did not actually repeal the individual mandate. Rather, it zeroed out both the dollar amount and percentage of income penalties imposed by the mandate. The individual mandate penalty provision (Code Section 5000A), as well as the remainder of the ACA, was left intact.
In a joint dissent from the ruling in Sebelius, the Supreme Court argued that the provisions were independent and could be severed. Since this was a dissenting opinion, the majority of the court found that the provisions were dependent on each other and the law needed all the provisions, including the individual mandate, to function. Since the individual mandate and penalties, core provisions of the ACA, have been removed, the law is no longer complete and cannot operate as it was originally intended according to the DOJ. Further, the DOJ argues that the proper course is to strike the law in its entirety rather than trying to pick and choose among the provisions and rule on each one.
Outcome of the Texas Ruling
While the ruling is being appealed, the ACA and its regulations remain intact. Only the individual mandate, which was removed separately, is no longer in effect. Until there is a final ruling from the appeals court or the U.S. Supreme Court, should they decide to take on the case, the law will remain as it is. However, as this case moves forward, it will receive significant attention from large companies, benefit plan providers, and everyone involved in the healthcare industry. The appeals court has received many briefs both in support of and against the ACA and its various provisions.
As this lawsuit continues, Hall Benefits Law attorneys will advise clients as to the likely impact of any rulings and help them make the best decisions for modifying or changing benefits plans to stay in compliance with current laws and regulations. Our team of experienced benefits attorneys are here to help. To learn more about our expertise and how we’ve helped clients across the United States, call 678-439-6236 today, or visit the Hall Benefits Law website.
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