The Supreme Court ruled Thursday that the Affordable Care Act, better known as Obamacare, remains valid, rejecting a claim by a group of conservative states that a recent change in the law made it unconstitutional.
By a 7-2 vote, the court said the challengers did not have legal standing to sue because they did not make a strong enough showing that the law harmed them. The decision also suggested that it would be difficult for any challengers to try again using the same legal theory.
Two of President Donald Trump's three appointees to the court, Brett Kavanaugh and Amy Coney Barrett, joined the majority opinion; the third, Neil Gorsuch, dissented.
In their dissent, Justices Samuel Alito and Gorsuch said the court should have taken the case and declared the law unconstitutional.
The law's challengers, Texas and 17 other Republican-led states, urged the court to rule that Obamacare's requirement for nearly all Americans to obtain health insurance or pay an income tax penalty — known as the individual mandate — is unconstitutional. For that reason, they said, the entire law must be scrapped.
"The plaintiffs claim that without the penalty the act's minimum essential coverage requirement is unconstitutional," Breyer wrote for the court's majority, adding, "They also argue that the minimum essential coverage requirement is not severable from the rest of the act," meaning the entire law is invalid.
"We do not reach these questions of the act's validity, however, for Texas and the other plaintiffs in this suit lack the standing necessary to raise them," he wrote.
President Joe Biden said the court's decision was "a major victory for all Americans benefitting from this groundbreaking and life-changing law," including the millions of people with pre-existing conditions and those in danger of losing their health insurance during the coronavirus pandemic.
"After more than a decade of attacks on the Affordable Care Act through the Congress and the courts, today's decision — the third major challenge to the law that the U.S. Supreme Court has rejected — it is time move forward and keep building on this landmark law," Biden said in a statement.
Former President Barack Obama celebrated the ruling, saying in a statement: "This ruling reaffirms what we have long known to be true: the Affordable Care Act is here to stay.
"Now we need to build on the Affordable Care Act and continue to strengthen and expand it," Obama added. "That's what President Biden has done through the American Rescue Plan, giving more families the peace of mind they deserve. And because he extended the special enrollment period until August 15th, anyone who needs coverage can go to healthcare.gov and sign up."
House Speaker Nancy Pelosi, D-Calif., hailed the decision in a news conference as a "landmark victory for Democrats' work to defend protections for people with pre-existing conditions."
"Once again, the Supreme Court upheld the constitutionality of the Affordable Care Act and the transformational protections that it provides every American, no matter where they get their coverage," Pelosi said. "I want to thank the grassroots across the country who worked tirelessly as advocates for the Affordable Care Act, to pass it, to save it and now to once again save it."
Republicans have long opposed the law, Obama's signature legislation. But more than 20 million people now depend on it for their health insurance, and there is broad public support for its requirement that insurance companies cover pre-existing health conditions.
On Thursday, Republican leaders in the House released a muted statement criticizing Obamacare but not the court's decision itself.
"While the Supreme Court ruled today that states do not have standing to challenge the mandate, the ruling does not change the fact that Obamacare failed to meet its promises and is hurting hard-working American families," House Minority Leader Kevin McCarthy, R-Calif., Minority Whip Steve Scalise, R-La., and Conference Chair Elise Stefanik, R-N.Y., said in a joint statement. "Now, Congress must work together to improve American health care."
The Supreme Court first upheld the law in 2012. The majority opinion, written by Chief Justice John Roberts, said the individual mandate was a legitimate exercise of Congress' taxing authority. But in 2017, the Republican-led Congress set the tax penalty at zero.
That led the red states to argue that because the tax had effectively been eliminated, the revised law could not be saved as a tax and therefore it was an unconstitutional effort to require all Americans to obtain something. A federal judge in Texas agreed, and the 5th U.S. Circuit Court of Appeals in New Orleans upheld that ruling.
California and 19 other blue states asked the Supreme Court to overturn the lower-court decisions. They said that with the tax penalty at zero, there effectively is no individual mandate, so the law is not unconstitutional. It may encourage Americans to buy insurance, but it does not require anyone to do anything, they said.
The Supreme Court's newest member, Barrett, was considered a possible vote in agreement with the Republican states. In a 2017 law review article, she said the Roberts opinion "pushed the Affordable Care Act beyond its plausible meaning to save the statute."
But Barrett joined the majority Thursday in rejecting the challenge.
The red states said Congress meant the health care law to work as an integrated whole. Prohibiting insurers from denying coverage for pre-existing conditions and allowing young people to stay longer on the policies of their parents were meant to work because of the near-universal command to buy insurance. Without the mandate, the challengers said, the law falls apart.
But the blue states said the test for deciding whether the rest of a law can be saved if part of it is struck down is a simple one: What did Congress want? They said the answer is found in the 2017 action that set the tax at zero: It left the rest of the law intact.