Obama: Violating the Constitution with Impunity?

by John Fund

President Obama and his lawyers must have labored long and hard to come up with yesterday’s administrative “fix” that allows insurance companies to keep offering old plans Obamacare was meant to kill off for another year. The whole point of the exercise appears to be to twist the Constitution into a pretzel in order to shift the blame for canceled policies from Obama to insurance companies. Sadly, he may have come up with a clever way to insulate his plan from legal challenges.

Lots of people question whether Obama can simply use “enforcement discretion” to ignore the insurance regulations (which were written specifically with the intent of triggering mass cancellations to force healthy people with low-cost policies into the more expensive federal exchanges). Even Howard Dean, a doctor and former chairman of the Democratic National Committee, said yesterday, “I wonder if he has the legal authority to do this.”

At last night’s annual Federalist Society dinner in Washington there was general agreement that Obama had violated the Constitution. “A president has discretion to prioritize which lawbreakers to prosecute in federal court, but there is no ‘enforcement discretion’ to determine which laws on the books he will enforce,” constitutional scholar Ken Klukowski told me.

But the problem is that anyone wanting to challenge President Obama’s extra-constitutional action would have to show standing in court — some injury that would allow litigation to go forward. “He’s been clever about this,” Utah Senator Mike Lee told me. “If you are simply reducing legal burdens on people rather than curbing their behavior, it’s hard to prove an injury. It’s a dangerous precedent because it could give presidents a path to ignore laws they don’t like.”

There is a chance the Obama “fix” will create enough chaos in insurance markets that an identifiable injury could emerge. Here’s Robert Laszewksi, an insurance consultant, in a memo to his clients yesterday on what the Obama ruling will mean:

The insurance companies have 32 days to reprogram their computer systems for policies, rates, and eligibility, send notices to the policyholders via US Mail, send a very complex letter that describes just what the differences are between specific policies and Obamacare compliant plans, ask the consumer for their decision —  and give them a reasonable time to make that decision —  and then enter those decisions back into their systems without creating massive billing, claim payment, and provider eligibility list mistakes. All by January 1. 

Of course, it’s difficult to feel all that sorry for the insurance companies. They either supported or acquiesced in the passage of Obamacare in exchange for the promise that they would get millions of new customers forced into the health-care marketplace by the individual mandate. 

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