What’s Next? The New Frontier of ACA Battles

On June 17, the Supreme Court, once again, issued a ruling protecting the Affordable Care Act from a legal demise. As Justice Alito put it in his dissent, this was the third installment in an “epic Affordable Care Act trilogy.” But the battle over the ACA is not over. The trilogy will keep adding sequels.

A 7-2 court in California v. Texas held that the plaintiffs challenging the ACA’s individual mandate lacked standing, a constitutional prerequisite to bring any suit. The court found that the individual mandate, originally preserved by the court in 2014 as a tax, did not injure the plaintiffs because the monetary penalty was reduced to zero by a Republican Congress in 2017. Without the teeth of the tax, the individual mandate has no bite.

Because of that, plaintiffs had no injury that could be cured by a court decision and thus, no “standing.” Of course, the dissenting justices disagreed, finding the states challenging the law had been financially injured by other requirements imposed by an ACA that the individual mandate made possible.

Despite the wide margin of victory, proponents of the ACA should not rest easy. By basing its decision on standing, the court did not decide whether the mandate or ACA are constitutional. The 7-2 decision suggests little appetite on the court to strike down the ACA in its entirety, but Justice Alito’s dissent charts a possibly successful course for future litigants to follow.

Justice Thomas’ concurrence hints that if the next plaintiff more forcefully argued the dissent’s theory of standing, he would approve it. Would two other Justices join Thomas in “flipping” on the standing issue and subsequently find the law unconstitutional in its entirety? Given the current conservative makeup of the court, it is possible.

The next big challenge to come (Kelley v. Becerra) takes aim at a single provision, not the ACA in its totality. The provision guarantees preventative care and contraception are covered in health plans at no out-of-pocket cost.

The ACA points to three non-governmental entities to determine the exact preventative services that insurance must cover. Instead of a religiously based challenge to contraception, litigants are being more technical and challenging that section of the ACA as an unlawful delegation of policymaking authority. Such a surgical strike could doom one of the more popular provisions of the ACA.

Legislatively, the days of “repeal & replace” seem over. The Biden administration and a Democratic Congress are focusing on strengthening the ACA. They are seeking to make temporary pandemic subsidies for health plans permanent, reining in deductibles on the Marketplace, and lobbying the 13 remaining states to finally expand Medicaid.

No major efforts to repeal the law will be possible unless Republicans have control of Congress and the White House after 2024. Even then, it would be a dubious political proposition to repeal a nearly 15-year-old law that has become more popular as more citizens have come to rely on its guarantees.

While the threat of legislative repeal has disappeared, plaintiffs willing to take on the ACA have not. Renewed attempts to strike down the individual mandate and the law in its entirety will occur, but targeted challenges to individual ACA provisions seem to be the more pressing threat to the law.

Like the movie industry, challenges to the ACA just keep getting rebooted. What looks like a trilogy now will end up being just part of an extended series.

This article first appeared in The Journal Record on July 16, 2021, and is reproduced with permission from the publisher.

** Brooks Cain, a 2021 Crowe & Dunlevy summer associate, contributed to this article.

Share:

Associated People:

Kevin D. Gordon

Practice Area:

Healthcare