20 states sue to end ObamaCare -- and they might have a point

Conservatives have fumed for the past six years that ObamaCare should have been ruled unconstitutional by the Supreme Court. Instead, Chief Justice John Roberts took an argument that the Obama administration barely advanced, which is that the individual mandate was a “tax” and therefore ObamaCare fell within Congress’ constitutional authority. Now that the mandate’s penalties have been repealed in the tax reform bill, twenty states want the courts to strike down the rest of the Affordable Care Act:

A coalition of 20 states has filed a lawsuit alleging ObamaCare is unconstitutional.

They’re claiming that since the GOP eliminated the tax penalty associated with the individual mandate, that ObamaCare itself is no longer constitutional. …

The GOP tax law “eliminated the tax penalty of the ACA, without eliminating the mandate itself. What remains, then, is the individual mandate, without any accompanying exercise of Congress’s taxing power, which the Supreme Court already held that Congress has no authority to enact,” the complaint states.

“Not only is the individual mandate now unlawful, but this core provision is not severable from the rest of the ACA—as four Justices of the Supreme Court already concluded.”

The Reuters video raises an interesting question. The states have to sue the Department of Health and Human Services, which would normally require the Department of Justice to defend it. However, will the DoJ put up an active defense for HHS and the ACA when Donald Trump pledged to demolish it? It’s possible that the DoJ could default as a strategy, although under these circumstances a federal court might require a defense, or allow outside organizations to take on that role.

What about the case itself? The original 5-4 decision on NFIB v Sebelius et al was intellectually shaky at the time, especially with its reliance on a lower-order argument on the power of taxation. Removing the tax penalties from the mandate eliminates the factual crutch used by Justice Roberts. In the syllabus to his majority opinion, Roberts expressly found that “the individual mandate is not a valid exercise of Congress’s power under the Commerce Clause and the Necessary and Proper Clause,” on which he expands shortly afterward:

The most straightforward reading of the individual mandate is that it commands individuals to purchase insurance. But, for the reasons explained, the Commerce Clause does not give Congress that power.It is therefore necessary to turn to the Government’s alternative argument: that the mandate may be upheld as within Congress’s power to “lay and collect Taxes.” Art. I, §8, cl. 1. In pressing its taxing power argument, the Government asks the Court to view the mandate as imposing a tax on those who do not buy that product. Because “every reasonable construction must be resorted to, in order to save a statute from unconstitutionality,” Hooper v. California, 155 U. S. 648, 657, the question is whether it is “fairly possible” to interpret the mandate as imposing such a tax, Crowell v. Benson, 285 U. S. 22, 62. Pp. 31–32.

4. CHIEF JUSTICE ROBERTS delivered the opinion of the Court with respect to Part III–C, concluding that the individual mandate may be upheld as within Congress’s power under the Taxing Clause.

Without the tax penalty, the entire structure becomes problematic — at least if we go by Roberts’ opinion that carved out the constitutional niche in the first place:

The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce.

Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority. Congress already possesses expansive power to regulate what people do. Upholding the Affordable Care Act under the Commerce Clause would give Congress the same license to regulate what people do not do. The Framers knew the difference between doing something and doing nothing. They gave Congress the power to regulate commerce, not to compel it. Ignoring that distinction would undermine the principle that the Federal Government is a government of limited and enumerated powers. The individual mandate thus cannot be sustained under Congress’s power to “regulate Commerce.” Pp. 16–27.

(b) Nor can the individual mandate be sustained under the Necessary and Proper Clause as an integral part of the Affordable CareAct’s other reforms. Each of this Court’s prior cases upholding laws under that Clause involved exercises of authority derivative of, and service to, a granted power. E.g., United States v. Comstock, 560 U. S. ___. The individual mandate, by contrast, vests Congress with the extraordinary ability to create the necessary predicate to the exercise of an enumerated power and draw within its regulatory scope those who would otherwise be outside of it. Even if the individual mandate is “necessary” to the Affordable Care Act’s other reforms, such an expansion of federal power is not a “proper” means for making those reforms effective. Pp. 27–30.

So yes, the removal of the tax does make the mandate ripe for a court to strike down. The mandate, though, is also meaningless without the penalty. The question is whether striking down the mandate would cause the court to strike down the entire ACA — and that seems unlikely.

The problem for the lawsuit will be whether the courts will find severability between a suddenly unconstitutional (but also toothless) individual mandate and the rest of ObamaCare. Actually, as the opinion notes, the Eleventh Circuit had previously ruled that the mandate was severable from the rest of ObamaCare, a ruling which Roberts incorporated into his majority opinion even while making the issue moot. Severability became a much bigger issue for the forced Medicaid expansion that the ACA imposed on states, which NFIB v Sebelius discusses mainly in the dissent from the four conservative justices that wanted to overturn the entire ACA. In the end, though, the severability argument won there too, which is how the court struck down part of the Medicaid expansion without overturning the entire ACA.

The question then becomes how strong that precedent on severability will be with this court.(By the way, the argument that four justices denied severability means that five justices upheld it; dissents don’t make precedent on their own.) If the court follows its own precedent here, they can just strike off the mandate and leave the rest of ObamaCare still standing. Six years later, with Neil Gorsuch taking Antonin Scalia’s place, we’re essentially looking at the same court. Roberts might have regret over his original decision, but Kennedy might stand on the severability precedent, which would leave everything at status quo ante and a 5-4 upholding of everything but the mandate.

That seems a more likely outcome than a complete overturning of ObamaCare at this late stage, especially given the massively complicated unwinding of benefits and taxes that such a ruling would require. Most courts would blanch at that prospect, perhaps especially the one that created the problem in the first place. It’s still worth a shot from the perspective of these states, and will certainly make for an interesting journey through the lower courts.