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             Researh Service





Fifth Circuit Holds the Individual Mandate

Unconstitutional: Implications for Congress



Updated March 3, 2020

Update 312120: On March 2, 2020, the Supreme Court granted review in the Texas litigation. The
questions at issue before the Court are: (1) whether the individual and state plaintiffs have standing to
challenge the individual mandate; (2) whether the individual mandate, as amended, is constitutional; and
(3) whether the individual mandate is severable from the rest of the ACA. Oral arguments in the litigation
have not yet been scheduled, but will likely take place nextjall.
On December 18, 2019, the U.S. Court of Appeals for the Fifth Circuit (Fifth Circuit) issued its decision
in Texas v. United Staies on the constitutionality of the Patient Protection and Affordable Care Act's
(ACA's) requirement for individuals to maintain health insurance (the so-called individual mandate)
and the continued validity of the remainder of the Act. The Fifth Circuit affirmed a district court ruling
that Congress lacked the constitutional authority to enact the individual mandate, as amended by the
subsequent 2017 tax revision, but declined to resolve a broader issue: what happens now to the ACA's
remaining provisions? The Fifth Circuit reversed the district court's decision on this severability question
and sent the case back to the district court to explain with precision how particular portions of the ACA
as it exists post-2017 rise or fall on the constitutionality of the individual mandate. This Sidebar provides
background on Texas; discusses the Fifth Circuit's decision; highlights potential effects of the decision
and possible next steps for the case; and identifies legislative options for Congress.

Background
Enacted in 2010, one of the ACA's central goals was to increase the number and share of Americans
who are insured. In addition to sweeping changes to federal private health insurance regulation, income-
based subsidies to facilitate the purchase of health insurance, and substantial increases to the scope of
Medicaid coverage, the ACA, as originally enacted, also compelled certain individuals to maintain health
insurance and imposed financial penalties on those who failed to do so. These latter provisions form what
is commonly referred to as the individual mandate. In addition, the ACA includes other provisions
covering an array of issues ranging from health care workforce promotion to improving access to
innovative medical therapies.
Litigation over the constitutionality of the individual mandate is not new. In 2012, the Supreme Court
addressed this issue in a landmark case, National Federation of ,ndependent Business ii Sebelius (NFIB).
                                                                 Congressional Research Service
                                                                   https://crsreports.congress.gov
                                                                                     LSB10389

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