法律英語 Legal Lad 2012 Healthcare, the Constitution, and the Supreme Court

Today’s topic: Healthcare showdown at the Supreme Court
And now, your daily dose of legalese: This article does not create an attorney-client relationship with any reader. In other words, although I am a lawyer, I’m not your lawyer. In fact, we barely know each other. If you need personalized legal advice, contact an attorney in your community.
A Marathon Session at the Supreme Court
Almost exactly 2 years after Congress passed the Obama administration’s proposed healthcare reform – the Affordable Care Act, or ACA – the Supreme Court convened to consider the constitutionality of the law. Specifically, the Court gathered to hear the appeal of a decision by the Court of Appeals for the Eleventh Circuit striking down the central component of the law, known as the individual mandate. The Court scheduled an unprecedented 6 hours of legal argument (spread out over 3 days) for the case. In today’s article, I’ll explain the 4 major issues the Court is considering, and which way the justices seem to be leaning.
Issue #1: The Anti-Injunction Act
The first issue was whether the federal “Anti-Injunction Act” barred the Court from even considering the challenge to the ACA. The Anti-Injunction Act forbids taxpayers from challenging federal tax provisions before the tax is collected. In other words, if you want to challenge the validity of a federal tax, you’re supposed to pay the tax first and then fight with the IRS over a refund. Even though ACA isn’t exactly a tax law, the penalty for failing to obtain health insurance is a form of tax; or at least , the ACA inserts the penalty provisions into the tax code.
The odd thing is, none of the parties to the ACA lawsuits argue that the lawsuits are barred by the Anti-Injunction Act; not even the Obama administration, which, of course, opposes the lawsuits. However, the Federal Court of Appeals for the Fourth Circuit concluded that the Anti-Injunction Act applies and so the Supreme Court justices decided that they would have to address the issue for the sake of completeness. If the High Court rules that the Anti-Injunction Act applies, then all legal challenges to the individual mandate will have to be postponed until 2014, when the mandate and its penalty provision actually kick in.
At the Supreme Court, none of the justices appeared to be persuaded by the Anti-Injunction Act argument. In fact, none of the parties to the lawsuit were either – the Court had to appoint a special counsel to present the argument in favor of applying the Anti-Injunction Act so as to delay the case for two years.
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Issue #2: The Individual Mandate
On the second day of argument, the Court got to the central issue: the “individual mandate.” This refers to a provision of ACA that creates a legal duty for virtually all individuals in the U.S. to obtain health insurance that meets federal standards by 2014. The constitutional issue is whether Congress has the authority to impose such a mandate. The Constitution grants only certain “enumerated powers” to Congress. In the case of ACA, the government relies mainly on the constitutional power to regulate “commerce . . . among the several states.”
Even though individual healthcare decisions may not involve interstate commerce, the Supreme Court has held that Congress has the power to regulate economic activity that, in the aggregate, will affect interstate commerce. In 1942, the Court upheld New Deal regulations that dictated the amount of wheat a person could grow for his own family’s consumption (Wickard v. Filburn)! However, opponents of ACA point out that Congress has never used its power to compel individuals to purchase a product, whether they want it or not.
Despite early predictions that the mandate would be overwhelmingly upheld, the oral arguments revealed a Supreme Court deeply divided. A number of justices expressed concern about the implications of the individual mandate. Justice Kennedy wondered whether the government could “create” commerce rather than merely “regulating” commerce, while Justice Scalia worried about the government creating future individual mandates for other personal matters, such as mandates to eat our broccoli. Other justices, however, clearly supported the mandate. Justice Breyer, for example, argued that not long after the Constitution was ratified, Congress “created” commerce by chartering a Bank, thus setting an early precedent for the constitutionality of legislation that initiates commerce.
Issue #3: Severability
On day three, the Court looked at an issue called “severability.” This issue comes into play only if the Court does strike down the individual mandate, in which case it also has to decide whether the rest of ACA can survive without the mandate. The law is over 2,700 pages long – suffice it to say there’s a lot in there besides the individual mandate. However, the individual mandate is the part that is supposed to make the whole thing affordable. By requiring younger, healthier individuals to get health insurance, ACA aims to broaden the insurance pool and thus bring down premiums.
Unlike many other laws, ACA does not expressly address the severability of its provisions. The Obama administration argues that if the mandate is struck down, then only 2 closely-related sections would have to be jettisoned; the rest of the law could continue to operate. The state challengers argue that the mandate is the heart of the ACA, and, thus, if the mandate goes, the whole statute must go with it. Here again, the Supreme Court appeared to be deeply divided. The more liberal justices seemed to agree with the administration that the law could be selectively struck down, while the more conservative justices seemed more inclined to think that the whole package must stand or fall.
Issue #4: Coercion of States
Also, on day three, the Court considered whether the ACA’s expansion of Medicaid is valid. The new healthcare law requires that States must dramatically expand their Medicaid rolls – opening up the program to all individuals under 65 with incomes up to 133% of the poverty level. States that refuse to participate in this expansion of Medicaid risk losing all federal Medicaid funds – for most states, that’s more than a billion dollars a year!
The issue is whether the Medicaid expansion represents improper “coercion” of the states. On two occasions – in 1937 and 1987 – the Supreme Court stated that the federal government cannot use its spending power to coerce states into adopting particular policies. However, the Court has never actually held that the federal government has engaged in such improper coercion, so we don’t have a clear precedent.
At the Supreme Court, the coercion argument faces an uphill struggle. Since the federal government is underwriting 90% of the Medicaid expansion (at least in the early years) many justices expressed skepticism that there was any coercion going on. Still, a number of justices, including the Chief Justice, asked some pointed questions of the administration’s lawyer about whether there are any constitutional limits on the power of the federal government.
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