SCOTUS Skepticism Toward ACA Suit Gives Insurers a Boost

Although a constitutional challenge to the Affordable Care Act (ACA) has been winding its way through the court system for more than two years — fueling ongoing concerns about the law’s future — the Supreme Court during a Nov. 10 hearing appeared highly skeptical that the case has much merit. That’s welcome news for the health insurance industry, as analysts have long pointed out that the sector is eager to move past the uncertainty that the lawsuit has created.

The suit in question, now known as California v. Texas, was first brought by a Texas-led coalition of conservative states in 2018. It argues that the ACA’s individual mandate — which compels people to purchase health insurance — is unconstitutional because Congress removed the mandate’s tax penalty via a budget bill in 2017. The states’ argument relies upon a 2012 Supreme Court decision in the case National Federal of Independent Businesses (NFIB) v. Sebelius, when the justices ruled that the mandate was constitutional because it fell under Congress’ taxing authority. So if the mandate is only permissible as a tax, and the tax is now zero, the conservative states argue that the mandate itself is now unconstitutional — and with it, the rest of the law.

© 2021 MMIT

Leslie Small

Leslie has been reporting and editing in various journalism roles for nearly a decade. Most recently, she was the senior editor of FierceHealthPayer, an e-newsletter covering the health insurance industry. A graduate of Penn State University, she previously served in editing roles at newspapers in Pennsylvania, Virginia and Colorado.

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