[1] National Federation of Independent Business v. Sebelius, 567 U.S. 519 (2012), is a landmark[2][3][4] United States Supreme Court decision in which the Court upheld Congress's power to enact most provisions of the Patient Protection and Affordable Care Act (ACA), commonly called Obamacare,[5][6] and the Health Care and Education Reconciliation Act (HCERA), including a requirement for most Americans to pay a penalty for forgoing health insurance by 2014.

[7][8] The Acts represented a major set of changes to the American health care system that had been the subject of highly contentious debate, largely divided on political party lines.

A number of parties sued, including the National Federation of Independent Business, claiming that the sweeping reform law was unconstitutional for various reasons.

[9][10][11] The Supreme Court granted certiorari to three cases, totaling 5½ hours of oral arguments: National Federation of Independent Business v. Sebelius (which consolidated a part of Florida v. Dept.

[20][21][22] The court first heard argument on whether the Anti-Injunction Act, which limits suits "for the purpose of restraining the assessment or collection of any tax",[23] barred a decision before the ACA fully entered into force in 2014.

[24] Since neither the government, represented by Solicitor General Donald Verrilli, nor the states, represented that day by Gregory G. Katsas of the law firm Jones Day, were willing to defend that position (which had been accepted by three of the 12 appellate court judges who heard the cases),[25] the Court appointed Robert Long of the law firm Covington & Burling as amicus curiae to defend that position.

A separate combination of five justices (Roberts, Ginsburg, Breyer, Sotomayor, and Kagan) held the individual mandate was a valid exercise of Congress's taxing power.

Part III-C held that, for constitutional purposes, the individual mandate penalty was a valid exercise of Congress's taxing power.

"[40] Even where one views an individual's decision to self-insure as economic inactivity, the safety that such an omission to act provides from Congress's commerce power does not similarly apply to taxation.

[51] In part III-B of his opinion, Roberts argued that the failure to uphold the individual mandate penalty under those two clauses did not end the inquiry.

Those goods are produced, sold, and delivered largely by national and regional companies who routinely transact business across state lines.

[56]Justices Scalia, Kennedy, Thomas, and Alito joined an unsigned dissent that argued the individual mandate was unconstitutional because it represented an attempt by Congress to regulate beyond its power under the Commerce Clause.

"'[A]lthough this Court will often strain to construe legislation so as to save it against constitutional attack, it must not and will not carry this to the point of perverting the purpose of a statute ... ' or judicially rewriting it."

In this case, there is simply no way, "without doing violence to the fair meaning of the words used", Grenada County Supervisors v. Brogden, 112 U. S. 261, 269 (1884), to escape what Congress enacted: a mandate that individuals maintain minimum essential coverage, enforced by a penalty.The dissent also disputed Ginsburg's claim that the court's opinion failed "to explain why the individual mandate threatens our constitutional order":[59] [The individual mandate] threatens that order because it gives such an expansive meaning to the Commerce Clause that all private conduct (including failure to act) becomes subject to federal control, effectively destroying the Constitution's division of governmental powers.

But he disagreed with the court's third, "substantial effects" test as established by Wickard v. Filburn, articulated within United States v. Morrison, and strengthened by Gonzales v. Raich.

[65][66][67] On July 1, 2012, CBS News, citing unnamed sources within the Court, said that over the course of internal deliberations Roberts changed his position from striking down the mandate to upholding it.

"[71] Some observers have suggested Roberts's philosophy of judicial restraint[72] or the lack of Supreme Court precedents available "to say the individual mandate crossed a constitutional line" played a part in his decision.

[73] The article reported that after Roberts "withstood a month-long, desperate campaign to bring him back to his original position", with Kennedy, who was typically the swing vote in 5–4 decisions, leading the effort, the conservatives essentially told him, "You're on your own.

Breyer and Kagan had previously voted to uphold the Medicaid expansion, but decided to switch and join Roberts's opinion on that section.

Conservatives quickly seized on the fact that Obama and the bill's proponents insisted repeatedly throughout the protracted political debate 2009 and 2010 that the mandate was not a tax, but the Court upheld it on the grounds that it was.

[78] Republican presidential candidate Mitt Romney said he would repeal the bill,[78] as did Speaker of the House John Boehner[79] and Senate Minority Leader Mitch McConnell.

With respect to the Commerce Clause, the Court ruled that the federal government had no permission to force individuals not engaged in commercial activities to buy services they did not want.

[7] With respect to the Medicaid expansion under the Affordable Care Act, the Supreme Court held that the ACA's requirement that states rapidly extend coverage to new beneficiaries or lose existing federal payments was unduly coercive.

[82] Georgetown Law professor Randy Barnett said that by invalidating the withholding of existing Medicaid funding as unconstitutionally coercive,[86] the Court found an enforceable limit on the spending power of the federal government.

"[88] Katyal also mentioned that the federal government told the court that long-standing laws contain clauses that condition money on state performance of certain activities.

"[88] Reuters later reported that Katyal had reversed his opinion and stated that he didn't see any litigation coming out of the Supreme Court holding in the near term.

[89] Kevin Russell, who teaches Supreme Court litigation at Harvard and Stanford Law Schools and clerked for Judge William Norris of the Ninth Circuit and Justice Breyer, agreed with Katyal.

[92] Fairleigh Dickinson University's PublicMind conducted research on the public's constitutional perspective by asking registered voters about key legal issues brought up by ACA litigation through two surveys based upon a random sampling of the population.

In 2017, Congress passed the Tax Cuts and Jobs Act that reduced the health insurance requirement of the ACA to $0 from 2019 onward, effectively eliminating the individual mandate.

Texas and several states sued the federal government, arguing on the basis of Sebelius that with mandate eliminated, the entire ACA was unconstitutional.