01:12 - Source: CNN
Lawyers respond to Obamacare hearing
(CNN) —  

Chief Justice John Roberts saved Obamacare in 2012 by calling it a tax. Now, his core argument is helping power a Republican-led legal challenge that threatens to sweep away the entire law.

The Affordable Care Act faces its third major legal test since President Barack Obama signed it in 2010, putting access to health insurance for millions of Americans and coverage for those with pre-existing conditions, such as cancer and diabetes, into question.

The appeals court case, heard in New Orleans on Tuesday, may also complicate the legacy of the chief justice, who has attempted to keep the Supreme Court out of politics but could soon face another presidential election-year health care dispute.

Roberts, a 2005 appointee of Republican George W. Bush, forged a compromise in 2012 with the four Supreme Court liberal justices to uphold the signature domestic achievement of Obama.

In dramatic moves behind the scenes, Roberts shifted multiple times in that landmark Obamacare challenge. After the 2012 case was argued, Roberts was part of a five-justice majority that wanted to strike down the individual insurance mandate. But he became wary of voiding a significant part of the law that was years in the making and reconsidered.

That eventual 2012 decision has shaped public perceptions of the chief justice, who since then has been viewed with skepticism by conservatives even as his record – for example, on racial issues, campaign finance and religion – remains solidly on the right.

Roberts’ opinion is now at the center of the legal debate seven years later.

His 2012 rationale for upholding the ACA’s individual insurance mandate was tied to Congress’ taxing power. Texas and other Republican-led states, backed by the Trump administration, contend that when Congress zeroed out the tax penalty in 2017 for people who failed to obtain insurance, it eviscerated its constitutional grounds.

“The entire basis,” for the 2012 decision, Texas solicitor general Kyle Hawkins argued Tuesday, “is now off the table.” Without the linchpin of the individual insurance mandate, he said, the entire law must fall.

Lawyers for California and other Democratic-led states, along with the Democratic-run US House of Representatives, countered on Tuesday that even without a tax penalty, the individual mandate remains constitutional, as does the entire ACA.

“There’s another way to read” the 2012 Roberts’ decision, insisted Douglas Letter, counsel for the US House. He argued that Roberts’ opinion said people had a choice whether to buy insurance or face a tax penalty. Letter said that choice remains, even if the tax penalty is zero.

“The choice that Chief Justice Roberts made clear to all of us is there,” he said, stressing that the chief sought a way to preserve the law on some constitutional grounds. “I know Texas is unhappy with what Chief Justice Roberts did. They wish he had done something different. But he didn’t. … And that is binding.”

The future of the health-insurance overhaul appears destined to return to the Supreme Court and Roberts, whose views on the 2017 tax change are not known.

Last December, a US district court judge agreed with the Republican challengers and ruled that because the tax penalty is now zero, the entire health care law is unconstitutional. On Tuesday, a panel of the 5th US Circuit Court of Appeals appeared poised to find that at least a significant part of the ACA should fall, if not all of it.

That panel is not expected to rule for several months. When it does, the case of Texas v. United States is likely bound for the Supreme Court where, despite recent changes among the nine, the majority that previously upheld the law – Roberts and four liberal justices – is still there.

Switch by Trump administration

This new case could be the most consequential test of Obamacare yet. Millions of Americans now obtain their health insurance through the ACA-created exchanges or Medicaid expansion. Among the law’s provisions, people with cancer, diabetes or other pre-existing conditions cannot be refused coverage and children can stay on their parents’ health insurance plans until they turn 26.

The Trump administration initially argued that, based on the 2017 tax law change, only the individual mandate and two related provisions tied to protections for people pre-existing health conditions should be invalidated. But now its Justice Department is agreeing with Texas that the entire law should be struck down because, they insist, the law’s many provisions are intertwined.

If one is unconstitutional, so is the rest, they say – a ruling that if upheld could give Trump the result of killing Obamacare that he couldn’t accomplish with a GOP-controlled Congress in 2017.

A majority of the three-judge panel on Tuesday signaled by their questions that they were sympathetic to that position.

The 100-minute hearing was dominated by two Republican-appointed judges: Jennifer Elrod, named by President George W. Bush, and Kurt Engelhardt, appointed by President Donald Trump. The third judge – Carolyn Dineen King, named to the bench by Democrat Jimmy Carter – asked no questions during the hearing.

When House counsel Letter argued that judges should follow Roberts’ approach to save the ACA in 2012, Elrod suggested she believed the 2017 tax change altered Roberts’ premise in the case of National Federation of Independent Business v. Sebelius.

Elrod asserted that linking the individual mandate to a “revenue-producing” measure was “essential.”

Engelhardt questioned why, after a US district judge declared the whole ACA unconstitutional, Congress did not pass legislation clarifying what provisions should stay on the books.

“Why does Congress want the … judiciary to become the taxidermist for every legislative big-game accomplishment that Congress achieves?” Engelhardt asked.

Letter responded in part by repeating the traditional Supreme Court principle that judges should uphold as much of a piece of legislation as possible when one part is found invalid.

If judges follow the lessons of the Supreme Court majority, Letter insisted to the 5th Circuit panel, “you will keep in place the overwhelming percentage of the Affordable Care Act.”

The positions of Republican appointees Elrod and Engelhardt, while no doubt arising from valid constitutional concerns, reinforced the partisan cast of the case that has pitted red states against blue states, the Republican Trump administration against the Democratic House.

Such political currents would likely draw the notice of Roberts, who has been trying to keep the US judiciary above the partisan fray. The simple makeup of the high court does not make that easy.

The five conservatives, including Roberts, were appointed by Republican presidents. The four liberals were appointed by Democrats. They often vote along ideological, if not political, lines.

In the recently completed Supreme Court session, however, Roberts inched to the left in key cases and appeared to be trying to bridge the court’s divide in these politically volatile times.

Those moves recalled the Obamacare decision that, even seven years later, defines him in the public eye.