The Supreme Court is arguing Obamacare for the third time on Tuesday, November 10, in Texas v. California.
“The tax will come back to haunt him,” one legal observer remarked after Roberts first designated Obamacare a tax, rather than entitlement in a 5-4 decision in National Federation of Independent Business v. Sebelius in 2012.
Obamacare was spared again in 2015 in King v. Burwell.
And indeed, the tax has come back to haunt Obamacare. The story goes like this:
In September 2017, Senator John McCain gave the famous thumbs down to the Graham-Cassidy Repeal and Replace bill —sponsored by Lindsay Graham of South Carolina and Bill Cassidy of Louisiana, that would have replaced Obamacare with “skinny” health plans that offered watered-down benefits.
Susan Collins also broke ranks with Republicans, as did Lisa Murkowski.
It appeared that the people had spoken, as Congress had codified the Affordable Care Act once and for all.
However, just before Christmas, one of the writers of Trump’s 2017 Tax and Jobs Act secretly sneaked a clause into the bill that neutered the Obamacare individual mandate for people opting out of Obamacare, so their penalty was zero.
No Longer Constitutional
Because Obamacare was no longer a tax, 18 Texas attorneys general and Trump’s Department of Justice threw the case to the White Supremacists on the 5th Circuit Court of Appeals in New Orleans, whose jurisdiction includes parts of Texas, Louisiana, and Mississippi.
On December 19, 2019, the Fifth Circuit ruled in Texas v. Azar that now that the tax has been excised from Obamacare, the entire statute is no longer constitutional.
The judges sent the case back to a lower court in Texas to determine whether parts of Obamacare were worth salvaging.
Before Texans could butcher the ACA, sixteen blue states, led by California, asked the Supreme Court to review the 5th Circuit’s ruling, arguing that the plaintiffs had no standing.
“Who is being harmed by not being fined?” the plaintiffs asked.
They also argued that since Congress repealed the individual mandate, but left the rest of Obamacare intact, lawmakers had no intention of striking down the entire law.
“Senator Susan Collins of Maine, says she did not think she was voting to overturn Obamacare entirely,” when she signed on to the tax act,” Vox writes.
A Scalpel, Not a Bulldozer
“Texas vs. California turns on the fairly arcane legal doctrine of severability,” Harry Litman, a University of California law professor and commentator for CBS News, writes in The Los Angeles Times.
Roberts has referred to severability as using “a scalpel, not a bulldozer,” Litman says.
“That doctrine comes into play when a court strikes down one provision of a statute and then must determine whether, without that provision, Congress would have passed the law in the first place. If the answer is yes, the errant provision is ‘severable,” Litman writes.
“If the answer is no, the whole law falls along with the one problematic provision.”
Doctrine Saved CFPB and Telephone Consumer Act
The severability doctrine saved the Consumer Financial Protection Board (CFPB) in Seila Law LLC v. Consumer Financial Protection Bureau, decided in the Supreme Court in June 2020.
The Supreme Court ruled that the CFPB, with a single director who could only be removed from office “for cause only,” violated the separation of powers.
The Court’s 5-4 decision, issued last June, ruled that the directorship position was severable from the CFPB itself.
The Court also rescued the federal anti-robocall provisions in the Telephone Consumer Act in Barr v. American Association of Political Consultants.
The Chief Needs One More Vote
Jordan Weissman writes in Slate that even with Barrett making up the fifth conservative vote, Obamacare “has a fighting chance as long as Roberts decides it’s in his long-term interest to protect it once again and can persuade one of the GOP-appointed justices” to vote with him and the liberals.
“But which conservative might go along with him? Based on one of his recent rulings, the most likely suspect might be Justice Brett Kavanaugh,” Litman writes.
“……The reason has to do with this stance on an issue known as severability.”
“He signaled as much in a recent case titled Barr v. American Association of Political Consultants, where Kavanaugh ruled that the court should surgically remove one section of a statute governing robocalls rather than junking the whole thing, reasoning that “the Court’s cases have… developed a strong presumption of severability.”
“Later in the opinion, he practically telegraphed a warning at the Republican state seeking to take down the ACA.”
Kavanaugh wrote: “Constitutional litigation is not a game of gotcha against Congress, where litigants can ride a discrete constitutional flaw in a statute to take down the whole, otherwise constitutional statue.”
Justice Barrett Supports Severability Presumption
“Supreme Court [justice] Amy Coney Barret signaled that the Affordable Care Act could survive a court challenge from the Trump administration, The Hill reports.
“The presumption is always in favor of severability,” Barrett said in response to a question from Lindsay Graham.
Read Scotus Blog to see the case history and pleadings about the Obamacare case.