Supreme Court agrees to hear latest challenge to ACA

The Supreme Court on Monday agreed to hear a challenge from red states that the Affordable Care Act is unconstitutional, with the case likely to be heard this fall.

The case led by Texas and 17 red states is the third time the Supreme Court will decide the fate of the ACA. The lawsuit focuses on whether the individual mandate is constitutional and if the rest of the law should be taken down if the mandate is not. 

A three-judge appellate panel ruled last year that the individual mandate, which requires everyone to have health insurance, is unconstitutional. However, it did not make a decision on whether the rest of the law should go, deferring that issue back to a lower court that originally sided with the red states that the law should be struck down entirely.

The individual mandate's penalty is already zeroed out due to the 2017 tax reform law. The red states' lawsuit argued that Congress intended for the rest of the law to be struck down and that the ACA can't stand without the mandate.

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A group of 21 blue states that have been defending the law has countered that if Congress wanted to get rid of the rest of the law then it would have done so, but it only zeroed out the penalty. 

The blue states had appealed the Fifth Circuit's December 2019 decision to the Supreme Court, wanting the justices to fast-track and take up the case. The states had wanted the court to hear the case in its current term, meaning that a decision would be rendered in June during the middle of the presidential election. 

But the court decided against hearing the case in its current term, and instead on Monday decided to hear the case in its next term that starts in the fall. It remains unclear if the court will hear oral arguments in the case before the presidential election in early November.

The Department of Justice has joined the red states in supporting the dismantling of the ACA, but administration officials have been pressed by Democrats over a lack of a plan should the law go away.

The entire healthcare industry has been on edge over the fate of the law. 

America's Health Insurance Plans, the insurance industry's leading lobbying group, applauded the high court's decision to hear the lawsuit. 

"We are confident that the Supreme Court will agree that the district court’s original decision to invalidate the entire ACA was misguided and wrong," said AHIP President Matt Eyles in a statement.  

Association for Community Affiliated Plans, a group that represents more than 70 safety-net plans, was also concerned about the air of uncertainty over the lawsuit. 

"This lawsuit has cast a pall of uncertainty over the future of the individual insurance market," said ACAP CEO Margaret A. Murray. "This uncertainty has hindered competition as health plans have waited out substantial uncertainty."

The American Hospital Association also wanted a quick decision by the Supreme Court to uphold the law. 

"While today’s Supreme Court decision to review the challenge to the ACA brings us one step closer to the resolution patients need, these critical coverage gains will remain in unnecessary limbo without expedited review," said AHA President and CEO Rick Pollack.

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This will be the third time the Supreme Court considers a challenge to dismantle the ACA. The last time was the case King v. Burwell in 2015, which argued the law's subsidies were illegal unless distributed through a state-run insurance exchange. 

The court struck down that challenge and another challenge in 2012 that the individual mandate was unconstitutional.