Bench Memos

First Readthrough of the Virginia Health-Care Decision

Judge Hudson’s decision regarding the constitutionality of Obamacare’s individual mandate marks the first of the major Obamacare lawsuits to reach summary judgment. A few thoughts based on my initial reading of the opinion:

1. The court recognized the activity/inactivity distinction as crucial in determining whether the Commerce Clause gave Congress authority to pass the health-care law. This distinction is key to any challenge of the individual mandate. The court observed that including decisions not to engage in activity in regulation based merely on a future likelihood that the individual will later engage in the activity could allow government regulation in any arena, from transportation and housing to nutrition. “This broad definition of the activity subject to congressional regulation lacks logical limitation and is unsupported by Commerce Clause jurisprudence” because all powers that have been upheld under the Commerce Clause “are triggered by some type of self-initiated action.” 

2. The court noted that, rather than arguing that the individual mandate had an “independent freestanding constitutional basis,” the government was focused on it as necessary to its other health-insurance-market reforms. This sounds like a Necessary and Proper Clause argument, but Judge Hudson treats it as a Commerce Clause argument, which conflates the two analyses (perhaps as a result of the briefs having done so — I have not yet read them all). Hudson later states that the Necessary and Proper Clause cannot apply in this case if there is no Commerce Clause authority. On the contrary, I believe it is only relevant if there is no independent (i.e. Commerce Clause) basis for the mandate. 

Hudson’s error seems to stem from his statement that only constitutional means are permitted under the Necessary and Proper Clause. This could indicate, as seems most logical, that only means that don’t violate constitutional prohibitions are possible. But Hudson interprets it to allow only means that have independent constitutional authority. If that were so, the Necessary and Proper Clause would be meaningless and give Congress no power it did not already possess.

In fact, there are good reasons the Necessary and Proper Clause doesn’t apply here (shameless plug: check out JCN’s amicus brief on behalf of Rep. Boehner in the Florida litigation that covers that Clause), and it’s a shame this decision misses a chance to discuss them.

3. Judge Hudson joined Florida District Judge Vinson in holding that the health-care law is not a tax, based both on the wording of the statute itself (which uses the term “penalty,” not “tax”) and congressional statements during passage relying on Commerce Clause power and denying that the bill was a tax. He characterized the reason for the shift as opportunistic: “The use of the term ‘tax’ appears to be a tactic to achieve enlarged regulatory license.” Congress can’t avoid public scrutiny by claiming it is not passing a tax, and then change its position after the fact to gain broader constitutional authority.

4. The court did not reach the issue of whether the individual mandate conflicted with the Virginia Health Care Freedom Act. This avoids a serious standing issue that would have complicated the case and eliminates one major distinction between this case and other lawsuits being filed around the country. When the case reaches the Supreme Court, as it surely will eventually, this makes it even more likely that the Court would consolidate it with the Florida case in which 20 other states are challenging the law.


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