Federal Appeals Court Rules Obamacare Individual Mandate Unconstitutional

A sign on an insurance store advertises Obamacare in San Ysidro, San Diego, Calif., U.S., Oct. 26, 2017. Mike Blake/Reuters

A federal appeals court on Wednesday ruled that the “individual mandate” component of former President Barack Obama’s Affordable Care Act is invalid. However, other parts of the law still require further review.

It was not decided how much of the act must also fall along with the individual mandate, which stipulates that American’s must obtain health insurance.

The panel sent the case back to a Texas federal judge, where it’s expected to be litigated over the next year.

As of now, it remains unclear what will happen to other parts of the act—such as protections for those with pre-existing conditions, Medicaid expansion, and the ability for children under the age of 26 to remain on their parents’ insurance.

However, the court’s decision will not immediately affect the former president’s signature health care policy or the millions of Americans who signed up for 2020 coverage. It will remain in place as the court case continues.

The 2-1 ruling was handed down by a panel of the 5th U.S. Circuit Court of Appeals in New Orleans in agreement with Texas-based U.S. district judge Reed O’Connor’s 2018 finding that the law’s insurance requirement, referred to as the “individual mandate” was rendered unconstitutional when Congress reduced a tax on people without insurance to zero in 2017.

“The individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power,” the ruling stated.

“On the severability question, we remand to the district court to provide additional analysis of the provisions of the ACA as they currently exist.”

“It may still be that none of the ACA is severable from the individual mandate, even after this inquiry is concluded,” the majority said. Or, “It may be that all of the ACA is severable from the individual mandate. It may also be that some of the ACA is severable from the individual mandate, and some is not.”

Meanwhile, President Trump heralded the decision as a “great victory for the American people and a positive step toward moving away from Obamacare, which “has failed the American people for too long.”

“Today’s decision in Texas v. Azar is a win for all Americans and confirms what I have said all along: that the individual mandate, by far the worst element of Obamacare, is unconstitutional,” he said in a statement.

“This decision will not alter the current healthcare system. My Administration continues to work to provide access to high-quality healthcare at a price you can afford, while strongly protecting those with pre-existing conditions. The radical healthcare changes being proposed by the far left would strip Americans of their current coverage. I will not let this happen. Providing affordable, high-quality healthcare will always be my priority.”

“They are trying to take away your healthcare, and I am trying to give the American people the best healthcare in the world,” he added.

Wednesday’s ruling means that the future of Obamacare will continue to be a major policy issue at the forefront of the upcoming 2020 U.S. election race.