Without Ginsburg, US Supreme Court could rule three ways on Obamacare

The death of Justice Ruth Bader Ginsburg means the Supreme Court will have a smaller liberal wing when it hears the latest Obamacare challenge in November.

That case, California v. Texas, could unwind Obamacare completely if the Supreme Court rules in favor of 20 Republican-led states and the Trump administration’s Justice Department. The Democratic nominee for president, Joe Biden, has already begun linking the court vacancy to Obamacare’s future, telling a crowd in Philadelphia this weekend that “health care hangs in the balance” with this year’s election. A more conservative court may invite further litigation against the health law, which has faced multiple Supreme Court challenges in its decadelong existence.

Those who have followed the case for years, however, do not expect the Affordable Care Act to be overturned with this case. “Replacing Ginsburg could have big effects in lots of areas,” said Jonathan Adler, a law professor at Case Western Reserve University. “I’m just not sure this case is one of them.”

The case centers on changes that Congress made to the health law as part of its 2017 tax reform bill. That law eliminated financial penalties associated with Obamacare’s mandate that Americans obtain health insurance.

The plaintiffs argue that the mandate becomes unconstitutional without those fines and that, if the court agrees, the rest of the law must come down with it. In legal terms, they make the case that the mandate is “inseverable” — so crucial to Obamacare that the law, including a provision banning insurers from rejecting patients with preexisting conditions, cannot stand without it.

When experts make their best guesses on California v. Texas, they see three possible outcomes: a ruling in the law’s favor, a deadlocked vote or a decision that takes down Obamacare. The first two generally seem more likely than the third.

The conservative justices are not persuaded

Just because many Republican-led states and the Republican White House have brought this case does not mean that Republican-appointed justices on the court will take their side. A majority of the court may still uphold the ACA.

That’s because many scholars see the case as legally weak. Unlike the two previous cases involving the health law — when the court’s liberal and conservative justices tended to disagree on major legal issues — this case centers on areas of law that are less disputed and less ideological.

A majority of the justices could rule that the mandate, now lacking a penalty, is unconstitutional. But, alone, such a finding would have no practical effects. What matters more is what happens to the rest of the law if the mandate is overturned.

Chief Justice John Roberts and Justice Samuel Alito have ruled in several recent cases that courts should try to preserve existing laws as much as possible when eliminating problematic provisions. And Justice Brett Kavanaugh wrote a majority opinion this term — while the Texas case was pending — agreeing with such reasoning.

“The court presumes that an unconstitutional provision in a law is severable from the remainder of the law or statute,” Kavanaugh wrote in the majority opinion upholding a congressional ban on robocalls. (He was joined by Alito and Roberts.)

His opinion says the court’s duty should be “to salvage rather than destroy the rest of the law passed by Congress and signed by the president.”

Adler is one of many legal scholars who supported earlier legal efforts to overturn the Affordable Care Act but who have sided with the law’s defenders on this case. In considering possible outcomes, he said he would not rule out a unanimous decision upholding the law.

There’s a deadlock, postponing a judgment

The Supreme Court is scheduled to hear oral arguments in California v. Texas on Nov. 10. If a new justice is not confirmed and seated by then, the case will be decided by the remaining eight members. A ninth justice who joined the court after oral arguments but before a decision would still not cast a vote.

An eight-member court raises the possibility that California v. Texas could end in a tie at the Supreme Court. When that happens, the appellate court’s decision typically stands. But in this instance, the appellate court did not rule on the key issues in the case; it ruled instead to send the case back to the original trial judge in Texas for more analysis.

The group of Democratic states defending the health law rushed it to the Supreme Court anyway, arguing that the court could end the “uncertainty already caused by this litigation.” That means that a tie could lead to years of litigation as the case is re-argued, potentially resulting in another Supreme Court hearing years from now. The health care law would be left standing in the meantime, with the justices skirting a political controversy in the short term.

“The advantage is there is no opinion, just a one-sentence ruling saying the lower court is affirmed,” said Josh Blackman, a law professor at South Texas College of Law who has submitted an amicus brief on behalf of the challengers. “They don’t weigh the issues. You don’t know why they ruled the way that they ruled.”

Such a tie would most likely occur if Roberts sides with the court’s three Democratic appointees, and the other Republican-appointed justices vote the other way. Barring a recusal, a tie would not occur if a new justice were seated before November, bringing the number of justices back to nine. But there is a chance a majority of the justices simply affirm the appellate court’s ruling, sending the case back through the process again in the same way.

Obamacare is overturned, in whole or in part

Even before Ginsburg’s death, the Supreme Court was controlled by five Republican-appointed justices. Though many legal observers say Roberts will find against the Republican states, he might not. That is why advocates for the Affordable Care Act and Democratic politicians have been concerned about this case all along.

“It is still unlikely to prevail, but the small chance of a very bad thing happening is worth worrying about,” said Nicholas Bagley, a law professor at the University of Michigan, who supports Obamacare.

There are a few different ways such a decision might work. Texas and the Trump administration have asked the court to overturn the entire Affordable Care Act. The Supreme Court could make such a ruling. But it’s also possible the court will rule to overturn some parts of the health law while leaving others untouched. Early in the litigation, the Trump administration’s lawyers suggested leaving most of Obamacare intact, but eliminating the provisions providing protections for Americans with preexisting health conditions, for example.

Any such ruling would have major practical and political effects. The Affordable Care Act is a complex law with tentacles across nearly every area of health policy — including state Medicaid funding; Medicare beneficiaries’ drug costs; and FDA approvals for generic-like copies of biologic drugs.

But even a ruling that only touched preexisting conditions would have huge effects, especially during a pandemic when so many Americans have lost their job-based insurance.

That resulting chaos may also weigh on the justices. Amy Howe, a co-founder of Scotusblog, said a group of justices that includes Roberts and Kavanaugh are concerned about the reputation of the Supreme Court as an institution.

“This is happening in such a fraught time, right after Election Day,” she said. “I do think the politics of the moment are not even at the back of their minds, but in the middle of their minds.”

If the court did amend Obamacare, the government could pass new legislation to restore coverage options, and any new policy would most likely take different forms depending on who controls the White House and Congress. Biden supports creating a public option — more people could get government insurance, but only if they want it — while the Trump administration has repeatedly promoted a “wonderful plan” for health care while releasing no details.

A less ambitious Congress interested in preserving the health law could also resurrect it by restoring a penalty for people who don’t buy insurance — even one as low as $1.