The conservative federal judge who earlier this month ruled that the Affordable Care Act is unconstitutional has issued a stay of his own opinion, which means the law will remain in effect as the appeals process goes forward.
U.S. District Judge Reed O’Connor, from Fort Worth, Texas, issued the stay Sunday evening and, to be clear, it does not mean he has reconsidered the case itself. On the contrary, O’Connor in his order reaffirmed his belief that Obamacare must come off the books.
But O’Connor also acknowledged the potential for extreme chaos if his ruling went into effect in time for the 2019 plan year, which formally begins on Jan. 1. With the stay in place, the Affordable Care Act’s many provisions, including its expansion of Medicaid and protections for people with pre-existing conditions, can continue as normal while the case moves through the federal court system.
The next stop on that journey is the Fifth Circuit Court of Appeals. Many experts critical of O’Connor have said they expect the appeals court to overturn his decision.
But the Fifth Circuit has some of the most notoriously and stridently conservative judges in the country, including five that President Donald Trump has appointed, and for that reason some experts say O’Connor’s ruling could survive scrutiny at the circuit court level.
That would set up an eventual hearing before the U.S. Supreme Court, which has already heard two major lawsuits that sought to declare the 2010 health care law unconstitutional ― rejecting most of the first one and the entirety of the second.
In both cases, Chief Justice John Roberts voted with the court’s four Democratic appointees and, in the more recent ruling, a second GOP appointee joined him ― although that second Republican was Anthony Kennedy, who has since been replaced by Brett Kavanaugh.
The central issue in the case, Texas v. Azar, is the same one that was at the heart of the first major constitutional challenge. It’s the Affordable Care Act’s individual mandate, which says that people who don’t obtain health insurance must instead pay a fine to the government.
The tax cut legislation that the Republican Congress passed and Trump signed in 2017 reduced the penalty to zero. The plaintiffs, 20 state Republican officials along with two private individuals, claim that the tax cut rendered the mandate unconstitutional, because the Supreme Court had justified the mandate as an exercise of congressional taxing power ― and, according to the plaintiffs, the mandate can’t qualify as a tax if it doesn’t actually require payment of money.
O’Connor agreed with that argument, which many legal experts question. But the more controversial and ultimately consequential part of his ruling was how he decided to remedy the problem. The plaintiffs had said that if the mandate is unconstitutional, then the entire law must go, too. O’Connor agreed.
If his ruling stands, every single provision of the law, including not just the coverage expansion but also new requirements on food menu labeling and changes to hospital payments, would suddenly become invalid. Policy experts have noted that it’s not even clear how the government would go about undoing these provisions, since some of them have been subject to subsequent modifications and are now deeply intertwined into the nation’s health care structure.
But practicality isn’t the reason so many legal scholars have criticized the ruling. It’s O’Connor’s constitutional logic, which even prominent conservatives, including lawyers instrumental in bringing previous cases against the Affordable Care Act, have said makes little sense.
In particular, they note, O’Connor has said the entire law is now invalid because courts must respect congressional intent and Congress originally deemed the mandate an essential part of the law’s machinery. Regardless of whether that’s true, legal experts say, Congress in 2017 very clearly decided that the mandate was no longer essential when it voted to zero-out the mandate, even though it understood the rest of the Affordable Care Act would remain in place.
In short, these experts say, O’Connor should be paying attention to what Congress did in 2017, not what it did back in 2010.
In Sunday’s order, O’Connor also addressed one more time the issue of “standing” ― that is, whether the plaintiffs can show they would suffer actual harm, which they must in order to bring a case before the courts. O’Connor says they do, because the mandate still requires them to get insurance. His many critics have said that, now that the mandate has no financial consequence, it doesn’t require people to do anything.
“I’ve been very critical of Judge O’Connor’s severability analysis, but the standing analysis in these opinions may be even worse ― and that’s saying something,” Jonathan Adler, a Case Western law professor who was an architect of the last legal challenge to the Affordable Care Act, wrote on Twitter. “I will be gobsmacked if O’Connor’s opinion survives review in the Fifth Circuit.”
There is no fixed timetable for what happens next. The Fifth Circuit could take up the case and dispose of it in a few months. If it overturns O’Connor’s ruling, the Supreme Court might refuse to hear further appeals, and this latest legal threat to the Affordable Care Act would end up failing more quickly than the previous two.
If, on the other hand, the Fifth Circuit judges side with O’Connor, then the Supreme Court is virtually certain to take the case. It’s possible that would lead to a hearing and eventual ruling sometime in 2020, smack in the middle of a presidential campaign.
The lawsuit has already played a pivotal role in one election. Democrats running for Congress this year cited it repeatedly as proof that Republicans and the judges they appoint want to take away the Affordable Care Act, including its highly popular protections for people with pre-existing conditions.
One reason the argument resonated was that the Trump administration, in a highly unusual move, chose not to defend the law in court and instead filed a brief in support of the case (although it called for invalidating only some of the law’s provisions). Democratic state officials, led by California Attorney General Xavier Becerra, have jumped in to take up the law’s defense.
Polls suggest health care was a major reason Democrats were able to retake control of the House of Representatives. The possibility of similar political blowback has been on the minds of some conservatives, including The Wall Street Journal’s influential editorial writers ― who, following O’Connor’s ruling, warned that the decision could come back to haunt Republicans in future elections.
That argument and others like it that appeared after O’Connor’s decision may have been a plea to conservative judges, on the Fifth Circuit and potentially the Supreme Court, to stop the case from going forward.