Supreme Court may 'tilt away' from protecting Obamacare: Yahoo Finance senior columnist Rick Newman

Yahoo Finance senior columnist Rick Newman talk about the effects a Supreme Court vacancy has on the Affordable Care Act, also known as Obamacare and how the Supreme Court may move away from protecting Obamacare.

Video Transcript

RICK NEWMAN: Yeah, this is kind of a complicated case. So Obama-- Obamacare, as the ACA is known, it did survive one trip through the Supreme Court. It did not get struck down, obviously, it's still in effect. So what happened the second time around is in the Tax Cuts and Jobs Act, which was the big tax cut bill Republicans passed at the end of 2017, that eliminated the penalty fee for people who did not abide by the individual mandate. So it used to be if you did not have insurance, then you had to pay a penalty fee.

So Congress zeroed that out. And the argument that the attorney general made of Texas is more or less this, that by lowering that to zero, that used to be considered a tax, the Supreme Court ruled on that a few years back. But when it goes to zero, it's no longer a tax. The Texas attorney general said, therefore, if it's not considered a tax, the individual mandate, itself, is completely invalid. And if that part of the law is invalid, then the entire Affordable Care Act is invalid.

A lot of legal experts at the time thought this was pretty flimsy legal logic. Nonetheless, it has made it all the way through the appeals process. And the Supreme Court is going to hear it on November 10, as you've pointed out. So, you know, the rule-- the last ruling on the ACA was 5-4 in favor of upholding the ACA with John Roberts as the swing vote.

Ruth Bader Ginsburg was another one of those, the majority votes. And, of course, she's gone. So, in theory, the court could tilt away from supporting the ACA and rule against the law, either invalidating part of it or invalidating all of it when this decision is likely to come probably next June.