Obamacare Information
Austin Business Lawyer
Corporate And Business Law Attorney

UPDATE (June, 2021): 

The U.S. Supreme Court ducks doing its job yet again!!  Upholds ACA ("Obamacare") in this latest lawsuit on a technical procedural ground.  Using its favorite dodge, the Court held Plaintiffs' do not have proper "standing" to bring the lawsuit.  Again the Supreme Court refuses to reach the merits of deciding whether Obamacare is constitutional, after stating in its first opinion on Obamacare that the mandate scheme was not constitutional unless the mandate/penalty provision was deemed to be a tax (despite the law and its history clearly stating it was NOT a tax).

The following is from "https://www.commonwealthfund.org/blog/2021/supreme-court-throws-out-aca-lawsuit-not-aca "

"The majority opinion held that neither the individuals nor the state plaintiffs had “standing” to challenge the mandate or the remainder of the ACA. Under the U.S. Constitution, federal courts may only decide “cases” or “controversies.” They have no authority to render abstract advisory opinions on the validity of a law. To establish standing, a plaintiff must show an actual injury that is traceable to an invalid law and can be redressed or remedied by the courts.

The Court held that with the removal of the tax penalty for noncompliance, the mandate was unenforceable against the plaintiffs. Moreover, any injury caused by the mandate was not “redressable.” Since the mandate could not be enforced, the Court could not enter an order prohibiting its enforcement, and a simple declaration that the law was invalid would be an advisory opinion.

The Court also found that Texas and the other Republican states lacked standing to challenge the law. The state plaintiffs claimed they were indirectly injured by the mandate because it would cause more people to enroll in Medicaid or state employee programs. They provided no evidence showing, however, that increased enrollment was traceable to the unenforceable mandate; the Court stated that “neither logic nor intuition” supported their argument. Texas also asserted that it would bear increased direct costs because of ACA reporting and administrative requirements, but the Court found that these costs were not caused by the mandate and would remain even if it were struck down.

Justices Alito and Gorsuch dissented, expressing frustration that the Court was saving the ACA a third time. They would have found that Texas had standing because it was harmed by ACA provisions that are enforced by the federal government and allegedly inseverable from the mandate, that the mandate was unconstitutional, and that at least some provisions of the ACA should be invalidated. They opined that since the Court had not reached the merits, another plaintiff with standing could challenge the ACA again."

        <<<<<<<<<<<<<<<<<>>>>>>>>>>>>>>>>>

UPDATE (2018 - 2019):  A federal judge has ruled the Affordable Care Act (ACA or Obamacare) is unconstitutional because Congress, in the Tax Cut and Jobs Act, eliminated the tax penalty under the individual mandate for those who do not maintain health care insurance. The case is likely to go the Supreme Court.  The ruling against Obamacare in the federal district court has been appealed to the U.S. Supreme Court.  A final ruling on the case is expected in July.

Explanation: Under the USA constitution the federal government is supposed to be completely limited to doing things and passing laws that fall under one of several specific things and categories specifically listed in the constitution.  It is supposed to be a government of "enumerated powers", as opposed to a government of general and unlimited powers.  Among the enumerated powers of the federal government are, in general, the exclusive right to handle mail, regulate interstate commerce, and levy certain types of taxes.

Obamacare contains a provision which provides everyone must buy health insurance.  And not just any health insurance but only the specific kind of health insurance designed by the government.  This part of Obamacare that requires everyone to buy health insurance is referred to as the "individual mandate".  Obamacare as originally passed also contained a provision that penalized any person who didn't obey the individual mandate by failing to buy the government mandated health insurance policy.  That penalty was to be collected by the IRS.

Obamacare was originally challenged in court as being unconstitutional because the individual mandate didn't fit under any enumerated power of the federal government.  Specifically, it was argued that it didn't fit under the federal government's power to regulate INTERSTATE COMMERCE. 

The Supreme Court agreed the individual mandate was not a proper application of the government's power to regulate interstate commerce, and would, if not saved by something else, be unconstitutional.  The Supreme Court found that something else in the enumerated power of the federal government to levy taxes.  The Supreme Court ruled the penalty for failing to obey the law regarding the individual mandate was in reality a valid tax under the government's taxing authority.  The court reasoned that the penalty was a valid tax, and the individual mandate was so tied to that tax that it was constitutional as a part of the federal government's enumerated power to levy certain kinds of taxes.  (Note:  I'm just summarizing what happened in the Supreme Court.  I'm not saying I think it was correct or logical or not completely crazy and off the wall).

Since that decision in the Supreme Court however, the Tax Cut And Jobs Act was passed under President Trump.  Part of that law repealed the Obamacare penalty/tax that the Supreme Court relied upon to say the individual mandate was constitutional. 

So after the Tax Cut And Jobs Act Obamacare continues to have the individual mandate that requires by law that everyone must buy government specified health insurance.  BUT, the tax penalty for not obeying the individual mandate no longer exists.  Since that tax no loner exists, it can no longer be argued that the individual mandate is constitutional under the enumerated power to levy certain taxes. 

Since the Tax Cut And Jobs Act the individual mandate must stand on its own.  The Supreme Court has previously ruled it can't stand under the enumerated power to regulate interstate commerce.  So unless the Supreme Court invents a new word game/fiction to find another enumerated power to support the individual mandate, the individual mandate is unconstitutional because it does not fall under one of the federal government's enumerated powers in the constitution.

Finally, the court in Fort Worth ruled that the individual mandate was so important to and so integral to all of Obamacare as a whole that it could not be separated from Obamacare as a whole.  That means if the individual mandate is unconstitutional and it can't be severed from Obamacare as a whole, then all of Obamacare must be thrown out as unconstitutional.