Oral arguments before the Eleventh Circuit began with Chief Judge Dubina seeking permission to stop thinking about which parties have standing to challenge which provisions of the Affordable Care Act. The basic reasoning (apparently endorsed by Judge Marcus and not challenged by Judge Hull) seemed to be:
(a) there are two challenges: (1) a challenge to the individual mandate; and (2) a challenge to Medicaid provisions;
(b) an individual plaintiff in the case has standing to challenge the individual mandate;
(c) the States in the case have standing to challenge the Medicaid provisions;
(d) the Court can therefore rule on both the individual mandate and the Medicaid provisions; consequently,
(e) it is wholly academic to decide whether the States have standing to challenge the individual mandate (or whether the individuals have standing to challenge the Medicaid provisions).
This reasoning would make perfect sense if the Eleventh Circuit were the Supreme Court. A Supreme Court ruling binds the whole country, by virtue of vertical stare decisis. An Eleventh Circuit ruling does not bind the whole country. It binds district courts within the Eleventh Circuit, by virtue of vertical stare decisis. But outside the Eleventh Circuit, its ruling has binding effect only with respect to the parties to the judgment.
In the absence of inseverability, it would make little difference as a practical matter whether the Eleventh Circuit ruled on state standing to challenge the individual mandate. If the individual mandate were held unconstitutional and severable, that would have no effect on the the legal obligations of the States who, after all, are not subject to the individual mandate. But if the individual mandate were held unconstitutional and inseverable (as the district court held), and if the States are proper parties to the judgment, then the entire Affordable Care Act is a dead letter with respect to the plaintiff States (but only those States along with those in the Eleventh Circuit). But the world is different, and not just as an academic matter, if the States are _not_ proper parties to that judgment (as they are not). That is because the Eleventh Circuit’s ruling would have no effect in those States on the enforceability of the other provisions of the Affordable Care Act that, unlike the mandate, are currently in effect.