Supreme Court Leaves Obamacare Trapped in Legal Limbo

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From practically the moment it was signed into law 10 years ago, Obamacare has been trapped in judicial limbo. The various lawsuits against it—challenging the legality of the individual mandate, the Medicaid expansion requirements, various insurance subsidies, the individual mandate (again), the insurance regulations, and even the entire construct of the law—have kept the law in legal and political purgatory, its fate never quite determined.

Thanks to the Supreme Court, it appears likely that it will stay that way through this year’s election and into next year. The Court today rejected a request by a group of Democratic state officials and members of the House of Representatives to fast-track a decision on the latest challenge to the law, meaning the law’s legal fate probably won’t be determined until sometime next year. 

At the beginning of this year, a coalition of blue states supporting the law had asked the High Court to speed up consideration of the case, the jointly named California v. Texas and House of Representatives v. Texas, which has been working its way through the lower courts for the better part of a year. In December, the U.S. Court of Appeals for the 5th Circuit ruled that the law’s mandate, which was upheld as a tax in 2012 and then zeroed out by the Tax Cuts and Jobs Act in 2017, was unconstitutional since it no longer raised any revenue

The 5th Circuit punted, however, on the broader question of what its ruling meant for the rest of the law, sending it back to a lower court that had previously ruled that, absent the mandate, the entire statute must be struck down. 

In the short term, the 5th Circuit ruling had essentially no practical effect: The mandate had already been functionally eliminated by the 2017 tax law, which reduced its tax penalty to zero. Yet it returned questions about the law’s fate to a judge who had already said he believed the entire statute should go under any reading of the evidence. 

The Democrats behind the petition to fast-track the Supreme Court ruling on the case had clearly hoped to make the issue more salient in this year’s election; the Trump administration made the unusual decision not to defend the law in court, and health care is an issue that helped propel Democrats to victory in the 2018 election. The Trump administration, in turn, filed a brief saying that waiting to hear the case would be fine.

In the narrow sense, this is probably a victory for President Trump and Republican critics of the law. But by leaving the case’s final resolution up in the air, it nevertheless keeps it alive as a political issue, and gives Democrats who support the law an argument to make against Republicans, particularly Trump, who support the administration’s decision not to defend it in court. 

Unlike several of the previous legal challenges to the health law, I believe this particular case rests on a largely flimsy argument. Other staunch critics of Obamacare have also said it lacks legal merit

Yet the fact that the law is still in court, its entire fate hanging in the balance nearly a decade after passage, is a reminder of its fundamental political weakness. An unusually complex statute predicated on dubious constitutional notions and passed on a party line vote without majority support from the public was nearly certain to be under constant threat from legal attacks—some with merit, some perhaps without. The law’s supporters assumed that it would amass political support over time, insulating it from threats. It is true that Obamacare has become more popular under Trump (probably in part because of GOP attempts to weaken it). But thanks to both the lasting partisan backlash to the law and the convoluted legal rationales for upholding it, the legal challenges have continued, and its future remains in doubt. Obamacare was born into limbo, and there it is likely to stay. 


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