Last December, a federal judge in Texas District Court ruled that the Affordable Care Act (ACA) was unconstitutional. The decision came in response to a lawsuit filed by 20 Republican state attorneys general. These attorneys general argued that the ACA was unconstitutional because there is no longer a penalty associated with the Individual Mandate, and the judge agreed. The judge issued a stay on his decision knowing it would be appealed to a higher court. The Fifth Circuit Court of Appeals in New Orleans said earlier this month it will begin hearing oral arguments of the appeal in July.

There are three potential outcomes from the appeal:

1. The Fifth Circuit Court of Appeals could agree with the District Court’s decision.

2. The Fifth Circuit Court of Appeals could determine that just the Individual Mandate is unconstitutional without a penalty. This would mean the Individual Mandate would have to be removed from the ACA, but the rest of the law would remain intact. In this scenario, it is possible that other parts of the ACA that are closely linked to the ACA would also have to be removed, such as the requirement for insurance carriers to issue health insurance coverage regardless of an individual’s health status.

3.  The Fifth Circuit Court of Appeals could disagree with the District Court’s decision.

It’s too early to know how the Fifth Circuit Court of Appeals will rule, but it is looking more and more like this lawsuit will ultimately find its way to the U.S. Supreme Court. We may not know the fate of the ACA for another year, if not longer.

Have a question about the Affordable Care Act?