The recent tax cut legislation also puts an end to penalties for failing to buy health insurance, a development 20 states now argue should render the rest of Obamacare unconstitutional.
Led by Texas Attorney General Ken Paxton, the states filed suit in federal district court in Fort Worth on Monday, asking for an injunction against continued enforcement of the Affordable Care Act and, ultimately, for the law to be struck down.
President Trump and Republicans often assert that the tax bill repealed the individual mandate, but that’s not exactly correct.
“It made the individual mandate a zero. It zeroed it out, which is what they could do because the Supreme Court had declared the individual mandate a tax but it didn’t strike the language from the statute,” said Rob Henneke, a former colleague of Paxton’s who is now general counsel at the Texas Public Policy Foundation.
“So part of the argument that the states have here is that because the individual mandate is set at zero, it is not performing the functions of a tax and therefore cannot still be construed constitutional by the Supreme Court under the taxing powers of Congress,” said Henneke.
And why is that? In 2012, despite ruling that the law violated the Commerce Clause of the Constitution by forcing Americans to purchase a product, Chief Justice John Roberts saved the Affordable Care Act by declaring the the individual mandate a tax, which is within the powers of Congress.
Henneke says without that rationale, Obamacare collapses.
“The whole crux of that regulatory scheme rests on the essential component of being able to compel Americans to purchase health insurance or pay this tax penalty. Now that that one card has been pulled out of that house of cards, the states argue that the entire regulatory scheme collapses,” said Henneke.
Henneke admits that the justices seem very reluctant to confront Obamacare again, but he says the states are hoping Roberts will reverse course once he’s confronted with his own words.
“In this situation, it is the Supreme Court’s own words in the NFIB v. Sebelius case, where they point to the individual mandate as the key component in what made the Affordable Care Act constitutional,” said Henneke.
Another big question, says Henneke, is whether the defendants will put up much of a fight this time around.
“It remains to be seen what position this administration and the Department of Justice is going to take and if and how they are going to defend the law.
“The president has been very critical of the Affordable Care Act. It’s been a cornerstone of what he campaigned on. Are they really going to disagree with the 20 states that have challenged the constitutionality of this law or do they agree with the argument presented by the states? ” said Henneke.
He says it’s also possible that this case could make it through the system pretty quickly.
“[The states] are asking for a court to enjoin the Affordable Care Act, to have a court order that would stop that law from continuing. That is the ultimate relief that is sought in the lawsuit. but stay tuned. We may see those states come to court earlier and ask for a preliminary injunction to stop the Affordable Care Act while the lawsuit goes on,” said Henneke.
“If that happens, then that could be a decision that moves up through the court system much, much faster than the three or four years it takes a lawsuit to normally get through the trial court,” he added.
