Federal Court Strikes Down Entire Affordable Care Act

January 31, 2011

In one sentence, U.S. District Judge Roger Vinson caused a nationwide tidal wave of reaction across the healthcare industry: "Because the individual mandate is unconstitutional and not severable, the entire [Affordable Care] Act must be declared void."

In one sentence, U.S. District Judge Roger Vinson caused a nationwide tidal wave of reaction across the healthcare industry: "Because the individual mandate is unconstitutional and not severable, the entire [Affordable Care] Act must be declared void."

Vinson's sentence comes at the end of his 78-page decision in favor of 26 states and the National Federation of Independent Business which began their legal challenge of the healthcare reform law within hours of President Barack Obama signing his name to the legislation. The matter has been tied up in motions until today, when Vinson sided with the states and against the Obama Administration and Congress.

In a landmark ruling that is surely headed to the U.S. Supreme Court, Vinson ruled that the federal government cannot require individuals to secure private insurance or face a fine, also known as the "individual mandate" in the reform law. This provision fining individuals for not buying a product in the private insurance market was to kick in as of 2014.

But now, not only is that one provision - geared to ensure Americans have the means to see physicians for care as opposed to relying on emergency rooms for their everyday care, and thus saving billions - by the entire law is now in jeopardy. That means accountable care organizations. That means Medicaid eligibility expansion. That means the continuing support of EHRs.

Prior to deeming the entire law null in void, Vinson expressed his understanding to reform the entire healthcare industry, but said the means did not justify the ends:

"The existing problems in our national health care system are recognized by everyone in this case. There is widespread sentiment for positive improvements that will reduce costs, improve the quality of care, and expand availability in a way that the nation can afford. This is obviously a very difficult task. Regardless of how laudable its attempts may have been to accomplish these goals in passing the Act, Congress must operate within the bounds established by the Constitution. Again, this case is not about whether the Act is wise or unwise legislation. It is about the Constitutional role of the federal government."

This is, of course, not the first legal obstacle for the Affordable Care Act, but it is perhaps the most significant. It means a certain showdown in the Supreme Court with the federal government on one side and states and other objectors on the other.

What does today's ruling mean for your practice, if anything? Weigh in below.