Obamacare law's fate on the line as US Supreme Court justices hold arguments

The conservative-majority US Supreme Court on Tuesday heard arguments in a challenge by Republican-governed states including Texas, backed by President Donald Trump's administration, aiming to invalidate the Obamacare healthcare law.

President-elect Joe Biden has criticized Republican efforts to throw out the Affordable Care Act (ACA), as the law is formally known, in the midst of a deadly coronavirus pandemic and hopes to buttress Obamacare after taking office on Jan. 20.

The justices were hearing a scheduled 80 minutes of arguments by teleconference in an appeal by a coalition of Democratic-governed states including California and New York and the Democratic-led House of Representatives to preserve Obamacare.

Conservative justices indicated they think the Republican challengers had the proper legal standing to bring the legal challenge by describing similar scenarios in which someone might be able to file suit over a government mandate even if there is no penalty. The arguments began with a discussion over legal standing, with questions by Chief Justice John Roberts and fellow conservative Clarence Thomas.

Liberal Justice Sonia Sotomayor questioned whether the Republican states had standing, saying their alleged injuries are not related to the individual mandate. "They should have brought that challenge" if they wanted to sue over other parts of the law, Sotomayor added.

The case represents the latest Republican legal attack on the 2010 law, which was the signature domestic policy achievement of Democratic former President Barack Obama, under whom Biden served as vice president. The Supreme Court in 2012 and 2015 fended off previous Republican challenges to it.

The Supreme Court has a 6-3 conservative majority after the Republican-led Senate last month confirmed Trump's third appointee, Amy Coney Barrett. Most legal experts think the justices will stop short of a seismic ruling striking down Obamacare.

Texas and the other Republican-governed states, later joined by Trump's administration, sued in 2018 in Texas to strike down the law.

If Obamacare were to be struck down, up to 20 million Americans could lose medical insurance and insurers could once again refuse to cover people with pre-existing medical conditions. Obamacare expanded public healthcare programs and created marketplaces for private insurance.

"We think there's a very strong chance that Americans will continue to have good healthcare coverage," Becerra added.

Texas-based US District Court Judge Reed O'Connor in 2018 ruled that Obamacare was unconstitutional as currently structured in light of a Republican-backed change made by Congress a year earlier.

The New Orleans-based 5th US Circuit Court of Appeals last year partially upheld that ruling, saying the law's "individual mandate," which required people to obtain insurance or pay a financial penalty, afoul of the Constitution. But the 5th Circuit stopped short of striking down the law. The Democratic-led states and the House then appealed to the Supreme Court.

The 2012 Supreme Court ruling upheld most Obamacare provisions including the individual mandate. The court defined this penalty as a tax and thus found the law permissible under the Constitution's provision empowering Congress to levy taxes.

In 2017, Trump signed a law that eliminated the financial penalty under the individual mandate, which gave rise to the Republican lawsuit. With that change, the individual mandate could no longer be interpreted as a tax provision and was therefore unlawful, the Republican challengers argued.

Donald Verrelli, the lawyer representing the House, told the justices that the Republican challengers were "asking this court to do what Congress refused to do when it voted down repeal of the ACA in 2017. But their argument is untenable."

Michael Mongan, California's solicitor general, told the justices that "what Congress did here was to create an inoperative provision. It doesn't require anybody to do anything."

"Why the bait and switch?" Roberts asked Verrilli in relation to the Democratic arguments that losing the mandate would not scuttle the law, which is not what they argued in the Supreme Court's 2012 case. Then, Verrilli represented the Obama administration in defending Obamacare.

Verrilli responded that Congress actually adopted a "carrot and stick" approach in adopting Obamacare and that "it turned out that the carrot worked without the stick."

Thomas, addressing the question of legal standing, also asked whether people would be able to challenge a mandate requiring people to wear masks during the coronavirus pandemic even if there is no penalty for not wearing one.

Proposing another hypothetical situation, conservative Justice Brett Kavanaugh wondered if people would have legal standing to sue if Congress required everyone to fly an American flag outside their house but did not impose a penalty for not doing it.