The 5th U.S. Circuit Court of Appeals returned a closely watched case on Obamacare back to the lower courts, declaring the health insurance mandate unconstitutional while saying the rest of the law needed further analysis.
The 2-1 panel decision means that Obamacare’s future is unlikely to be resolved before the 2020 elections. Had the judges not returned the case to the lower courts, it likely would have been appealed to the Supreme Court and faced a decision on its survival just ahead of Election Day.
The decision landed on the same day that the House of Representatives debated impeaching President Trump. It also occurred roughly 14 hours after the enrollment period for Obamacare sign-ups ended for the year.
The suit in the case, Texas v. Azar, was originally brought by Republican state officials, but it had the support of the Trump administration. Democrats have used the case as ammunition that Trump is committed to taking away people’s coverage and the protections Obamacare provides, particularly its prohibition on insurers turning away sick people or charging them more.
The lawsuit came from Republican state officials who said that Obamacare must be struck down because the 2017 GOP tax overhaul zeroed out the healthcare law’s fine on the uninsured. Republicans said the fine had been central to Obamacare and that the rest of its provisions would not work and should not stand without it.
When Supreme Court justices reviewed the fine on the uninsured in 2012, they determined it was constitutional because it could be seen as a tax. Because the tax was now $0, the 5th Circuit cited the Supreme Court case and wrote that the mandate was unconstitutional “because it can no longer be read as a tax.”
But the judges did not decide whether the mandate could be separated from the rest of the healthcare law, or whether other parts should fall, instead punting the question back to the district court to “provide additional analysis.”
The federal judge who issued the decision that Obamacare was unconstitutional in 2018 was Reed O’Connor, who was appointed by President George W. Bush and who will take up the case again. The court determined the judge did not do “the necessary legwork” to decide which parts of Obamacare were affected by the mandate being zeroed out.
Carolyn Dineen King, who was appointed by President Jimmy Carter and who did not ask questions or make any comments about the case during oral arguments, dissented in the case, saying the law should remain in place “since Congress removed the coverage requirement’s only enforcement mechanism but left the rest of the Affordable Care Act in place.”
The majority opinion was issued by Judge Jennifer Walker Elrod, a Bush appointee, and Judge Kurt Engelhardt, who was appointed by Trump.
Undoing Obamacare entirely would cause the 20 million people who gained coverage under the law to lose it, but it would also affect other parts of the healthcare system. For instance, the law prohibits health insurers from turning away sick people or charging them more, allows children and young adults to stay on their parents’ health insurance until age 26, and expands the government’s Medicaid program to low-income people. There are parts of Obamacare that deal with healthcare fraud and others that deal with prescription drugs. Another portion of the law requires restaurants to post how many calories are in their food.
