Once Again, Obamacare’s Constitutionality Comes into Question

Readers might recall that, in 2012, the Supreme Court of the United States upheld the constitutionality of the Patient Protection and Affordable Care Act, colloquially known as Obamacare, by a 5-4 vote in a case captioned NFIB v. Sebelius.

Last year, Congress revised Obamacare. In the Tax Cuts and Jobs Act of 2017, Congress eliminated the penalty imposed on people who do not purchase health insurance by reducing the penalty to $0 effective January 2019.

What makes that 2017 law interesting for present purposes is this: Chief Justice John Roberts wrote the controlling opinion in NFIB v. Sebelius; he concluded that the Obamacare penalty can be characterized as a “tax”; and he decided that, so viewed, Obamacare was a constitutional exercise of Congress’ power to raise taxes.

Enter Texas. In February of this year, Texas and several other states filed a lawsuit alleging that, by reducing the Obamacare tax to zero, Congress eliminated the only basis on which the Supreme Court had upheld the constitutionality of Obamacare. A sine qua non of a tax is that it generates revenue, Texas argued, and beginning in January 2019 Obamacare will no longer do so.

Accordingly, concluded Texas, starting next year Obamacare can no longer be upheld as a lawful exercise of Congress’ taxing power, so the federal courts should hold the law unconstitutional now.

The possibility that Obamacare could yet be consigned to the ash heap delighted some and troubled others. (For my opinion on the matter, see here.) Recently, the Department of Justice filed its answer to the Texas complaint. In it, the department agreed with the plaintiffs that Obamacare will become unconstitutional once the individual mandate penalty effectively disappears next year.

The Justice Department believes that, as a result, several provisions of Obamacare must go, such as the requirement that insurance companies provide coverage to someone with a pre-existing condition—but the Justice Department thinks that the rest of the statute can stand.

Texas disagrees. It argues that the Obamacare statute is like the base in Jenga: Once you remove the critical elements, the entire superstructure falls apart.

You can read more here. 

Paul J. Larkin Jr. directs The Heritage Foundation’s project to counter abuse of the criminal law, particularly at the federal level, as senior legal research fellow in the Center for Legal and Judicial Studies. Read his research.