A federal appeals court ruled Wednesday that the Affordable Care Act’s individual mandate is unconstitutional. It did not strike down the entire law.

The Fifth Circuit Court of Appeals in New Orleans heard the case as part of a lawsuit initiated by the state of Texas.  Texas’ February 2018 lawsuit against the government, Texas et al. v. United States et al., includes 19 other states, and is co-led by Wisconsin Attorney General Brad Schimel.

The group argues that the ACA should be repealed, pointing to the 2017 Tax Cuts and Jobs Act that eliminated the individual mandate penalty.

Robert Henneke, an attorney with the Texas Public Policy Foundation, who presented arguments at federal court in September, argued that without a tax, the federal government has no business regulating health care.

“Our argument is without it generating revenue for the federal government, then that provision is unconstitutional and the entirety of the Affordable Care Act fails,” Henneke argued.

The states should be allowed to create their own health care systems without federal interference, he adds.

The court agreed.

In its 2-1 decision, the Fifth Circuit panel agreed the individual mandate is now unconstitutional, but returned that case to a lower court, which must now consider whether the unconstitutional individual mandate can be separated from the entirety of the law. The district court judge previously had ruled the entire law unconstitutional because of the zeroing out of the individual mandate penalty.

“Today’s decision is a victory for the American people and respect for the Constitution,” Robert Henneke, lead counsel for the individual plaintiffs and general counsel for the Texas Public Policy Foundation, said in a statement. “The court’s opinion recognizes that Obamacare continues to injure millions of Americans like our clients who have lost their choice of doctor, suffered rationed care, and had their insurance costs skyrocket. This decision puts us one step closer to eventually freeing the American people from its unconstitutional mandates and regulations.”

Neera Tanden, president and CEO of the Center for American Progress, criticized the decision.

“In remanding the case to the District Court, the 5th Circuit has put the future of American health care in the hands of a judge who has already proven his hostility to the ACA and its lifesaving protections that millions of Americans rely on,” Tanden said in a statement. “The Trump administration and attorneys general who brought this case have thrust the country into chaos with no plan to protect the American people’s health care.”

Calling it a Christmas victory, “This decision recognizes that Obamacare continues to injure millions of Americans like our clients who have lost their choice of doctor, suffered rationed care, and had their insurance costs skyrocket,” Henneke added. “We will continue to fight to protect the rights of families and individuals as the case continues to proceed through the courts.”

The case is expected to eventually be heard by the U.S. Supreme Court.