20 states sue to eliminate the ACA, citing provisions of the new tax law

Document titled, Affordable Care Act
Led by prosecutors in Texas and Wisconsin, 20 states have filed a lawsuit to abolish the ACA for good. (Image: Getty/Designer491)

Twenty states have launched a legal attack to bring down the Affordable Care Act (ACA) once and for all.

Led by attorneys general in Texas and Wisconsin, the lawsuit filed in the U.S. District Court in the Northern District of Texas claims the repeal of the ACA’s individual mandate’s tax penalty renders the entire law unconstitutional.

“Absent the individual mandate, the ACA is an irrational regulatory regime governing an essential market,” the complaint (PDF) states.

Free Daily Newsletter

Like this story? Subscribe to FierceHealthcare!

The healthcare sector remains in flux as policy, regulation, technology and trends shape the market. FierceHealthcare subscribers rely on our suite of newsletters as their must-read source for the latest news, analysis and data impacting their world. Sign up today to get healthcare news and updates delivered to your inbox and read on the go.

RELATED: What health insurance executives think of the GOP's plan to repeal the individual mandate

The individual mandate was eliminated beginning in 2019 as part of the Tax Cuts and Jobs Act of 2017, signed by President Trump in December. The complaint references the Supreme Court’s 2012 ruling which upheld the government’s constitutional authority to levy taxes against individuals but stated that the individual mandate alone was unconstitutional.

In a statement, Texas Attorney General Ken Paxton said the Supreme Court’s decision to uphold the ACA hinged on the “flimsy support of Congress’ authority to tax.”

“Congress has now kicked that flimsy support from beneath the law,” he said. “The U.S. Supreme Court already admitted that an individual mandate without a tax penalty is unconstitutional. With no remaining legitimate basis for the law, it is time that Americans are finally free from the stranglehold of Obamacare, once and for all.”

The states are seeking a permanent injunction against the Department of Health and Human Services (HHS) and the Internal Revenue Service from implementing or enforcing the law and asking the court to declare the ACA unconstitutional.

RELATED: House, states, Trump administration reach settlement in ACA subsidies case

Since its inception, the ACA has withstood a constant barrage of legal challenges from states and lawmakers, including multiple trips to the Supreme Court. Just days after the law was signed by President Barack Obama, 14 states filed a lawsuit to block the law.

In 2014, the House of Representatives, led by Speaker John Boehner, sued the Obama administration over cost-sharing reduction subsidies. That legal challenge was settled by the Trump administration in December, thanks in part to Trump’s decision to stop the CSR payments.

Suggested Articles

Humana filed suit Friday against more than a dozen generic drugmakers alleging the companies engaged in price fixing.

Ochsner Health System is partnering with Color to launch a population health pilot program to integrate genetic information into preventive care.

Medicare Advantage open enrollment kicked off last week, and insurers are taking new approaches to marketing a slate of supplemental benefit options.