Appeals court strikes ObamaCare mandate, sends case back to lower court

A federal appeals court on Wednesday ruled that ObamaCare's individual mandate is unconstitutional but punted on the larger question of what it means for the rest of the health law.

The 5th Circuit Court of Appeals in New Orleans remanded the case back to a federal judge in Texas to decide just how much of the rest of the Affordable Care Act (ACA), if any, is also unconstitutional.

"The rule of law demands a careful, precise explanation of whether the provisions of the ACA are affected by the unconstitutionality of the individual mandate as it exists today," the judges wrote for the majority.

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The 2-1 ruling is a victory for the coalition of 18 conservative attorneys general as well as the Trump administration, which endorsed the challenge and declined to defend the law in court.

The ruling keeps the legal threat to ObamaCare alive and could push the ultimate decision on the case past 2020. 

However, California Attorney General Xavier BecerraXavier BecerraSupreme Court denies blue states' effort to expedite ObamaCare challenge Overnight Energy: Appeals court tosses kids' climate suit | California sues Trump over fracking | Oversight finds EPA appointees slow-walked ethics obligations California sues Trump administration over fracking MORE (D), who is among those defending the health care law, vowed to challenge the ruling to the Supreme Court, meaning it could still decide to hear an appeal before the 2020 election.

"California will move swiftly to challenge this decision because this could mean the difference between life and death for so many Americans and their families," Becerra said in a statement. 

It takes only four votes at the Supreme Court to hear the case, but legal experts aren't sure if the court would take up a case that isn't final.

The ruling is not the complete victory the Trump administration had been hoping for, and it keeps Republican lawmakers in the hot seat. The lawsuit has proved to be a headache for congressional Republicans seeking to turn the page on their efforts to repeal ObamaCare after the issue helped Democrats win back the House in 2018's midterm elections.

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President TrumpDonald John TrumpRouhani says Iran will never seek nuclear weapons Trump downplays seriousness of injuries in Iran attack after US soldiers treated for concussions Trump says Bloomberg is 'wasting his money' on 2020 campaign MORE on Wednesday, though, cheered the ruling.

"Today’s decision in Texas v. Azar is a win for all Americans and confirms what I have said all along: that the individual mandate, by far the worst element of Obamacare, is unconstitutional," Trump said in a statement.

"This decision will not alter the current healthcare system. My Administration continues to work to provide access to high-quality healthcare at a price you can afford, while strongly protecting those with pre-existing conditions," he added. "The radical healthcare changes being proposed by the far left would strip Americans of their current coverage. I will not let this happen."

Democrats have been using the lawsuit to argue Republicans are a threat to the 20 million people who rely on ObamaCare for health insurance. The ruling could also energize 2020 Democratic candidates, who have until now been focused on debating the merits of "Medicare for All" versus a public option rather than defending ObamaCare's protections for people with preexisting conditions.

 

In 2018, District Judge Reed O’Connor, a George W. Bush appointee, determined the entire law was invalid because Congress eliminated ObamaCare's financial penalty for not having health insurance. O’Connor’s ruling blindsided experts, who thought the lawsuit was a long shot at best.

The ruling sends the case back to O’Connor to determine, again, just how much of the law needs to go.

The appeals court judges criticized O’Connor for not considering the intent of Congress when it eliminated the mandate penalty in the 2017 Republican tax reform law. But the appellate court did not give him any guidance as to which portions of the law it thinks are so intertwined with the mandate that they can’t be separated. 

The appeals court directed O’Connor “to employ a finer-toothed comb on remand and conduct a more searching inquiry into which provisions of the ACA Congress intended to be inseverable from the individual mandate.”

However, the judges did not specify “just how fine-toothed that comb should be — the district court may use its best judgment to determine how best to break the ACA down into constituent groupings, segments, or provisions to be analyzed.” 

In the ruling, Judge Jennifer Walker Elrod, a George W. Bush appointee, was joined by Judge Kurt Engelhardt, a Trump appointee. Judge Carolyn Dineen King, who was nominated to the bench by former President Carter, dissented.

The court also said the Trump administration's decision to switch legal positions in the case necessitated further review by O’Connor. The administration originally argued that the law's individual mandate and associated insurance protections should be eliminated but later changed its argument to say the entire law should be declared unconstitutional. 

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Neither Congress nor the Trump administration has a plan in place if the entire law were to be overturned. 

Democrats were quick to excoriate the decision, which they said gives a conservative judge another opportunity to kill ObamaCare.

"Trump asked the courts to take away preexisting condition protections for Americans, and after today’s decision, millions of families will go to sleep scared that those protections are still at risk," Sen. Ron Wyden (D-Ore.) said. 

Rep. Lloyd DoggettLloyd Alton DoggettGreen says House shouldn't hold impeachment articles indefinitely Appeals court strikes ObamaCare mandate, sends case back to lower court House passes sweeping Pelosi bill to lower drug prices MORE (D-Texas) noted that the ruing was released on the same day the House was voting to impeach President Trump.

"Hardly coincidental that, as the nation’s attention is focused on the impeachment of Donald Trump, Republican appellate appointees impede access to health care for millions of Americans," Doggett said in a statement. "It is just a matter of time before that Fort Worth trial court will again invalidate the entire Act, including its protections for patients with pre-existing conditions."

Updated at 7:28 p.m.

Morgan Chalfant and Jessie Hellmann contributed