When asked if the healthcare law was constitutional, then-Speaker Nancy Pelosi sneered, ‘Are you serious?’ Now the Supreme Court has decided it’s a worthy question
The Supreme Court has agreed to decide whether ObamaCare is constitutional, granting certiorari in a case brought by 26 states shortly after that law was enacted in March of last year. In so doing, it will be ruling upon the very nature of our federal union.
The Constitution limits federal power by granting Congress authority in certain defined areas, such as the regulation of interstate and foreign commerce. Those powers not specifically vested in the federal government by the Constitution or, as stated in the 10th Amendment, “prohibited by it to the States, are reserved to the states respectively, or to the people.” The court will now determine whether those words still have meaning.
As we argued two years ago in these pages, the Patient Protection and Affordable Health Care Act (aka ObamaCare) is unconstitutional. First and foremost, the law requires virtually every American to have health insurance. Congress purported to impose this unprecedented “individual mandate” pursuant to its constitutional power to regulate interstate commerce, but the requirement is not limited to those who engage in any particular commercial or economic activity (or any activity at all). Rather, the mandate applies to everyone lawfully present in the United States who does not fall within one of the law’s narrow exclusions.
Under our Constitution’s system of dual sovereignty, only states have the authority to impose health and safety regulations on individuals simply because they are present. The Supreme Court has ruled many times that the Constitution denies to the federal government this type of “general police power.” Federal legislation must be grounded in one of the “enumerated” powers the Constitution grants to Congress—such as the power to regulate interstate commerce. Although the Supreme Court has interpreted that power broadly (especially since the 1940s), it has consistently held that the Commerce Clause has limits.
If Congress can require individuals to buy or otherwise obtain and maintain health insurance simply because they may be said to impact commerce by their very existence, without regard to any particular activity in which they have chosen to engage, then there is no limit on federal power. For example, if Congress can require you to buy health insurance because your lack of insurance may, at some point in the future, impose costs on the wider economy, then on the same theory it can require the purchase (or sale) of virtually any good or service, since the failure to have or use the relevant product can always be said to have some economic impact.
Both the trial judge and Court of Appeals in Florida et al. v. U.S. Department of Health and Human Services duly struck down the mandate as outside the scope of Congress’s legitimate authority. It is highly unlikely that the Supreme Court will overturn that decision. To do so would require it to junk nearly 200 years of its own jurisprudence and create a federal government of unprecedented and uncontrolled power.
There are, however, a number of other critical questions the Supreme Court will now resolve. In addition to imposing the individual mandate, ObamaCare revolutionizes the Medicaid program. For more than 40 years, Medicaid has been a cooperative federal/state program to fund medical care for the poor. The states also contribute funds and have enjoyed wide discretion in designing and implementing their own programs. Now, as a means of ensuring the universal coverage ObamaCare set out to achieve, Medicaid has been transformed into a massive new health-insurance program for many in the middle class. The states must accept new, detailed federal requirements or lose all federal Medicaid funding—leaving their neediest citizens without any safety net.
Although there is always an element of choice in accepting federal money, the Supreme Court has clearly stated that if federal funding conditions and threats become coercive, they also violate the Constitution’s fundamental federalism principles. Here, both the trial and appellate judges acknowledged this rule—based on a 1987 case called South Dakota v. Dole—but felt constrained to uphold ObamaCare’s Medicaid provisions because they found no direct and controlling Supreme Court precedent on the point. By accepting certiorari on this question, the Supreme Court has signaled its willingness to determine where that all-important line of federal versus state coercion may be, and whether ObamaCare has crossed it.
The Supreme Court will also consider the question of “severability”—whether the entire statute must be struck down because one or two of its provisions are unconstitutional. The test here is whether Congress would have still enacted the law without the unconstitutional provisions. As the trial judge correctly concluded, there is little question that without the individual mandate Congress would not have enacted ObamaCare’s other provisions, many of which make little sense without that critical requirement.
Finally, the Supreme Court has also agreed to consider one of the highly technical arguments raised in the case, whether the federal Anti-Injunction Act (AIA) prohibits a challenge to the individual mandate before the requirement actually takes effect in 2014. This issue has always been a red herring, arising because the government tried to argue that the individual mandate can be justified under Congress’s power to tax, even if it is insupportable under the power to regulate interstate commerce.
Virtually every lower court to consider ObamaCare—both those that have struck down the law as unconstitutional and those that have upheld it—has agreed that the AIA does not apply here. There is every reason to believe that the Supreme Court will do the same. The AIA was designed to protect federal tax-collection activities, generally requiring that a tax be paid before its legality can be challenged in court. The mandate, of course, is not a tax—but an affirmative regulatory requirement. It is enforced by a penalty. The only connection with the federal tax apparatus is that the penalty will be collected by the Internal Revenue Service from tax refunds otherwise due to violators, and its application here would only postpone challenges to the individual mandate to 2014.
Overall, the Supreme Court’s agreement to review ObamaCare’s constitutionality probably sounds that law’s death knell. When asked about these constitutional issues before the law was enacted, then-House Speaker Nancy Pelosi simply sneered, “Are you serious?” At this point it is safe to say, yes we are.
Messrs. Rivkin and Casey are lawyers who served in the Justice Department during the Reagan and George H.W. Bush administrations. They represented the 26 states in their challenge to ObamaCare before the trial and appellate courts.