NFIB v. Sebelius

NFIB v. Sebelius, 567 U.S. 519 (2012), is a landmark decision of the United States Supreme Court.

The Patient Protection and Affordable Care Act (‘Obamacare’) included an individual mandate requiring most Americans to maintain health insurance or pay a penalty. It also expanded Medicaid coverage. States and individuals challenged the law, arguing that the individual mandate exceeded Congress’s Commerce Clause power and that the Medicaid expansion coerced states.

Significance

Chief Justice Roberts’ controlling opinion upheld the individual mandate as a tax under Congress’s taxing power but rejected the Commerce Clause argument — the government cannot compel individuals to enter commerce. The Court also held that the Medicaid expansion was unconstitutionally coercive because states risked losing all Medicaid funding if they refused to participate. However, the remedy allowed states to opt out of the expansion without losing existing Medicaid funds. The decision preserved most of the ACA while imposing significant federalism limits on Congress’s spending power.

Category

US Federal Case Law