National Federation of Independent Business v. Sebelius

In 2010, Congress passed the Patient Protection and Affordable Care Act (ACA). Shortly afterward, multiple parties, including business organizations, individuals, and 26 states, filed suit in district courts across the country to challenge the ACA’s constitutionality. The results were fractured: some courts upheld some or all of the ACA, others declared part or all unconstitutional, some concluded offending provisions could be severed, and others argued that the ACA could not be challenged until someone was forced to pay the penalty. The National Federation of Independent Business, the State of Florida, and others (plaintiffs) sued in Florida federal court Kathleen Sebelius, secretary of the United States Department of Health and Human Services (defendant). The litigation challenged two key provisions of the legislation: (1) the individual mandate, which required individuals to purchase health insurance or pay a penalty and (2) the Medicaid expansion provision, which conditioned continued receipt of federal Medicaid funds on states expanding their eligibility requirements for the program. The district court held that Congress had exceeded its authority in passing the individual mandate. The court concluded that the individual mandate was not severable and struck down the ACA as a whole. On appeal, the United States Court of Appeals for the Eleventh Circuit affirmed that the individual mandate was unconstitutional. However, the court of appeals determined that the individual mandate was severable; so, the rest of the ACA remained intact. The Supreme Court granted certiorari to resolve the split between the circuits.