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Summary of the Supreme Court Health-Care Oral Arguments



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From March 26–28, the Supreme Court will hold a historic six hours of oral arguments about the constitutionality of the Patient Protection and Affordable Care Act, or Obamacare. My JCN colleague Carrie Severino wrote an excellent white paper, excerpted by Townhall Magazine in its February issue, summarizing the four main issues the oral arguments will cover. What follows is a helpful summary of her white paper, with a brief summary of each issue at stake, including the lawyers arguing each issue (h/t ACA Litigation Blog), and the basic positions of each party. 

Anti-Injunction Act

Date of oral argument: March 26,

Issue: Can the parties sue before the law takes full effect?

Parties:

The Anti-Injunction Act bans consideration of the law until after 2014, when the individual mandate will take effect, because the mandate is properly characterized as a tax.

The Anti-Injunction Act is not applicable. Challengers in particular will argue that the Act does not apply because the mandate is not a tax, as it merely punishes the failure to buy insurance. 

Individual mandate

Oral argument date: March 27. 

Issue: Can Congress compel commerce under the Commerce Clause, the Necessary and Proper Clause, or the Taxing Power?

Parties

Commerce Clause: The Commerce Clause does not authorize the health-care law’s mandate that all individuals purchase health insurance. The mandate compels, instead of regulates, commerce, the Clause has never historically been used this way, and this interpretation precludes any reasonable limiting principle on the exercise of federal power.

Necessary and Proper Clause: The Necessary and Proper Clause could also not authorize the individual mandate, as the Necessary and Proper Clause cannot be stretched to create otherwise non-existent authority. At best the mandate counteracts bad effects of the law’s insurance regulations. It does not enforce the insurance regulations. 

Taxing Power: The mandate is not a tax, but a punishment for breaking the law that requires everyone to purchase insurance, a position taken by the law’s crafters in the Democrat-controlled Congress. 

  • Government, represented by United States Solicitor General Donald Verrilli.

Commerce Clause: The distinction between activity and inactivity, offered by opponents of the bill, is overly formalistic, and virtually all Americans will eventually participate in the health-care market. Congress is merely regulating the decision of how to pay for health care, requiring that it be funded through insurance. 

Necessary and Proper Clause: Alternatively, the mandate is necessary to the health-care law’s regulatory system behaving in accord with Congressional intent. Because the other insurance regulations in the health-care law are within the Commerce Clause’s power, the individual mandate must be as well, because without it, the insurance mandates would increase costs, contrary to Congress’s intent. 

Taxing power: The penalty for failure to obtain insurance is a tax, as it raises money, is codified within the Internal Revenue Code alongside federal-tax laws, and is reported and paid along with one’s federal taxes. Courts give Congress’s decisions to tax minimal scrutiny.

Medicaid Expansion

Oral argument date: March 28

Issue: Is the health-care law’s Medicaid expansion, conditioning the receipt of federal Medicaid dollars on the states’ dramatic expansion of Medicaid eligibility and coverage, constitutional?   

Parties

The Supreme Court’s dicta (non-binding guidance for future decisions) in South Dakota v. Dole says that the conditions Congress puts on federal grants might be disallowed if they become “so coercive as to pass the point which pressure turns into compulsion.” This proves the unconstitutionality of the expansion.   

Congress is free to dictate the terms of federal money, pointing out that the states know that the conditions of Medicaid grants are subject to change. Furthermore, the vast majority of the expansion’s costs will be borne by the federal government, especially in the early years of the law’s implementation.

Severability

Oral argument date: March 28

Issue: Severability, which determines if the mandate falls, how much of the law must fall with it? Issue hinges on, in part, whether “it is evident that the Legislature would not have enacted [the constitutional] provisions . . . independently of that which is invalid.”

Parties

If the mandate is unconstitutional, the Court should only strike down the individual mandate, as this is the most restrained approach.

The Court should excise only the other major insurance regulations if the individual mandate is unconstitutional. The provisions include those that require insurers to issue policies to individuals without respect for their health conditions, and require them to charge the same price for healthy and sick individuals. These insurance regulations only function in conjunction with the individual mandate, as without the mandate, insurance prices would skyrocket.

The mandate is central to the law, and so the whole law should be taken off the books. Congress would not have passed the law, as it is currently written, without the individual mandate. This position most takes Congress at its word, as expressed when it passed the bill. Even provisions of the bill that are seemingly unrelated to the individual mandate could not function as Congress intended without the mandate. 



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