The U.S. Supreme Court announced today it will hear a lawsuit challenging the health reform law’s constitutionality. Here are seven key questions and answers on where the lawsuits stand now, where they’re headed and what it means for the Affordable Care Act:
Health reform opponents contend that the decision to not do something — namely, not buy health insurance — is economic inactivity, rather than activity, and therefore not a behavior the federal government can regulate. Health reform supporters argue that, the decision to not purchase health insurance has an economic effect. An individual without coverage, for example, may not have the money to pay for an emergency room visit, sticking hospitals or taxpayers with the bill. In that way, they say, not purchasing health insurance is an economic decision.
If the individual mandate falls, what happens to the rest of the law? The question whether the health reform law can stand without the individual mandate — in legal parlance, whether the individual mandate is “severable” — is a pretty crucial one. A court could strike down that particular part of the law, while letting the rest of it stand. Or, it could rule that the mandated purchase of health insurance is so critical to the health reform law, that if it goes down, it takes the whole Affordable Care Act with it.
The 11th Circuit, the one appeals court to rule against the law, took the narrower option and found the rest of the law could stand without the mandate. But the Obama administration has actually urged the Supreme Court to view the mandate as not severable from the rest of the law.
Here’s why: With no penalty for not purchasing health insurance, but a requirement for insurers to accept anyone still standing, many expect the costs of insurance would skyrocket in this situation. Congress could, theoretically, replace the individual mandate with another policy that doesn’t fall afoul of the activity-inactivity distinction — this report from the Government Accountability Office lays out a number of alternatives — but it is unlikely that congressional Republicans would permit such a fix, at least in the near term.
On November 14, the Supreme Court announced it will take up the health reform law in its 2012 term. It will hear a lawsuit filed in Florida by 26 states and the National Federation of Independent Businesses. Earlier this year, the Eleventh Circuit Court of Appeals heard that case and ruled the health reform law to be unconstitutional.
Alongside Florida, 25 other lawsuits have also been filed against the health reform law. Four of those reached federal appeals courts. Courts in Washington, D.C. and in Michigan both upheld the health reform law as constitutional. The 11th Circuit Court of Appeals in Florida, however, came to the opposite conclusion, finding the health reform law unconstitutional. The Virginia-based 4th Circuit Court of Appeals dismissed two cases against the health reform law for lack of standing: Since the penalties for not purchasing health insurance do not kick in until 2014, the judges concluded that those challenging the health reform law had not suffered any injury and could not bring a case. No cases aside from the Florida one, however, have been picked up by the Supreme Court.
How do those decisions break down politically? Rulings on the health reform law have generally had a partisan flavor, with most Republican appointees finding the law unconstitutional and Democratic appointees coming out in the law’s favor. But there have been notable exceptions: In the most recent decision, Reagan-appointee Laurence Silberman wrote a full-throated defense of the health reform law for the District of Columbia Court of Appeals. In the 11th Circuit, Judge Frank Hull, a Clinton appointee, found the Affordable Care Act to be unconstitutional.
What’s the timeline moving forward? Now that the Supreme Court has announced it will take up a health reform challenge, it near certainly will hold oral arguments this coming spring. The Court has decided it will hear five and a half hours of oral arguments on the case. It would have to issue a decision by the end of June, when its 2012 term comes to an end.
What could the Court rule? The Court could rule that the health reform law is constitutional and allow it to move forward.
It could also rule, as the 11th Circuit did, that the individual mandate falls while the rest of the law stands.
The justices do, however, have another option: The Court could decide that the individual mandate is so key to health reform law that, if it falls, the whole law comes down with it.
There’s also the possibility that the Supreme Court could decide that the case isn’t ripe to be heard yet, since the individual mandate has not been implemented. This would be similar to the ruling that came out of the 4th Circuit Court of Appeals and would essentially tell the law’s opponents they can’t come back with a challenge until 2014, when the penalties for not purchasing insurance kick in.
What does this mean for implementing the law? The 11th Circuit Court of Appeals, the one appeals court to find the law unconstitutional, has specified its ruling does not does not mean that states do not have to move forward on implementing the law. Some states, however, have cited the legal uncertainty surrounding health reform as a reason for not moving forward on the law.