5th Circuit Upholds Lower Court, Calling ACA Unconstitutional

After months of deliberating, the 5th Circuit Court of Appeals agreed with the lower court in Texas v Azar, finding the individual mandate to purchase health insurance or pay a penalty, unconstitutional. The Court specifically notes “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.”

Since the actual penalty associated with the individual mandate has been reduced to $0 since the start of 2019, this finding has no practical implication for employer health plans or individuals. However, the larger and more important question now, is what happens to the rest of the ACA?

The case will now return to the lower court for an answer to that question. Regardless of which way the court comes out on the constitutionality of the remaining ACA, it is likely this case will make its way to the Supreme Court in the coming year.

The case is Texas v. U.S., No. 19-10011 (5th Cir. Dec. 18, 2019) and can be read in its entirety here.