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Friday, August 15, 2014
Middle District of Pennsylvania Rules Three Obamacare Provisions Unconstitutional
Originally Published on forbes.com on September 28th,2011
I am really enjoying the decisions on the challenges to the Patient Protection and Affordable Care Act, because it is bringing out the constitutional purists. Activists generally use the Constitution the way drunks use lampposts, more for support than illumination. Conservatives love states rights until you get to the Defense of Marriage Act, then maybe not so much. Abortion on the other hand, leave that to the states. Liberals are equally inconsistent, in my view. The consitutional issue in the Obamacare individual mandate cases is all about how far Congress can push its power under the Interstate Commerce Clause. The Middle Disrtict of Pennsylvania decision in Goudy-Bachman v HHS is a really good read if you have the patience.
The individual mandate in the act would require all individuals to have some form of health insurance or be subject to a fairly toothless penalty – Section 5000A of the Internal Revenue Code. The mandate is seen as necessary if insurance companies will be required to guarantee issue of health insurance policies and cover pre-existing conditions.
As this decision makes clear, though, it is not up to the Courts to decided whether these provisions are a good idea or not, rather:
this case concerns the precise parameters of Congress’s enumerated authority under the Commerce Clause of the United States Constitution. Specifically, the issue is whether Congress can invoke its Commerce Clause power to compel individuals to buy insurance as a condition of lawful citizenship or residency.
The federal government has a lot of power to tell you how to do many things and to forbid you from doing other things. There are actually very few things, though, that it can make you do under the Constitution:
Even in the face of a Great Depression, a World War, a Cold War, recessions, oil shocks, inflation and unemployment, Congress never sought to require the purchase of wheat or war bonds, force a higher savings rate or greater consumption of American goods, or require every American to purchase a more fuel efficient vehicle.
Americans, the court noted, have only been subjected to a limited number of personal mandates with clear constitutional foundations, such as serving on juries, registering for the draft, and filing income tax returns.
Much of what gets the federal government mixing it up in our lives is the Commerce clause. There are four important modern decisions about the limits of the Commerce Clause. Two indicate that there are almost no limits to Congress’s power under the Commerce Clause and two indicate that there is some limit.
Cases Supporting an Almost Unlimited Commerce Clause
Wickard v. Filburn and Gonzales v. Raich are both about growing things for personal consumption. Wickard a 1942 case is about growing wheat and Gonzales a 1995 case is about growing marijuana. Given the fungibility of those items a regulatory scheme that allowed an exception for home baked bread or home baked brownies would break down. So the Supreme Court has ruled that Congress in order to effectively regulate the interstate commerce in carbohydrates and cannabis implicitly has the power to regulate plants whose fruits will not travel far before being baked into something or going up in smoke.
Cases Indicating that There is a Limit to the Commerce Clause
United States v Lopez and United States v Morrison indicate that the Commerce Clause cannot be stretched to cover everything, US v Lopez was about the Gun-Free Scholl Zone Act. To show you how much this is a constitutional purist matter, Justice Scalia does not seem to have mentioned the merits of a having a high school that is not gun-free. He and I both attended one that was anything but gun free. The arms room at Xavier High School in my day could have outfitted a World War II rifle platoon. Of course when Justice Scalia was there and dinosaurs roamed the earth those particular weapons might have been in the hands of actual soldiers in harm’s way. Nonetheless, in a recent speech to the Xavier High School Regiment he fondly reminisced about being on the high school rifle team and often carrying his weapon on the subway. None of that came up in the decision though. United State v Morrison held the Violence Against Women act unconstitutional. Both these cases were about the power of Congress under the Commerce Clause and both indicated that it could only be strectched so far. There was no discussion of the merits of third graders going about armed or the desireability of gender based violence.
Other Obamacare Decisions
The district court concluded that those four decisions are not much help when it comes to the indiviudal mandate and moved onto some of the Obamacare decisions that have already come down. It focused on two cases the Sixth Circuit’s Thomas More Law Center, which held the mandate to be constitutional and the Eleven Circuit’s State of Florida v HHS which found the individual mandate unconstitutional but left the rest of the act intact.
The Sixth Circuit and Eleventh Circuit decisions concur on one significant point: the Health Care Act has no equivalent in Commerce Clause jurisprudence. Quite simply, there is no factually similar precedent addressing the use of Congress’s commerce power to enact an economic mandate of this magnitude.
Should There Be a Limit on the Commerce Power ?
In oral arguments the District Court asked the government attorneys a hypothetical question. With the graying of America possibly putting a strain on the long term care insurance market, could Congress require the purchase of long term care insurance ?:
In response, the government conceded that Congress could: (1) determine that a market is faltering due to the failure of individuals to pay for the goods or services they receive in that market, and then (2) invoke its Commerce Clause power to require the individuals to pay for the goods or services in advance of seeking or obtaining them. Thus, supported with appropriate findings, counsel for the government posited that Congress could require the purchase of long term care insurance as a condition of lawful residency
The District Court ends up concluding that the individual mandate is too big a stretch of the Commerce Clause without further guidance from the Supreme Court:
Heretofore, the Supreme Court has never sanctioned, under the auspices of the Commerce Clause, the enactment of a broad scale economic mandate in anticipation of a probable but uncertain future transaction. The Supreme Court’s Commerce Clause jurisprudence does not lend itself to such an expansive interpretation. Until the Supreme Court interprets the commerce power to permit these anticipatory mandates, I am bound by stare decisis to conclude that Section 5000A is unconstitutional.
The Court does not blow up the whole act. You still have to pay that excise on tanning services, although I have told you how to beat it. It sees the requirements that insurance companies be forced to issue to people and cover pre-existing conditions as linked to the mandate, though. So those also have to go.
What’s Different About Now and 1790?
Nowadays medical care actually helps us live longer. In 1790, it was close to a toss-up. Except in certain areas, you were probably healthier if you stayed away from it. If we do not want financial irresponisibility or poverty to carry a death sentence, people cannot be denied care that they cannot pay for. This creates a free rider problem which the individual mandate is meant to solve.
How is it Still Like 1790 ?
I think the Eleventh Circuit answered that question nicely and it greatly increased my liking for the constitutional purists, without necessarily turning me into one:
The result may appear “formalistic” in a given case to partisans of the measure at issue, because such measures are typically the product of the era’s perceived necessity. But the Constitution protects us from our own best intentions: It divides power among sovereigns and among branches of government precisely so that we may resist the temptation to concentrate power in one location as an expedient solution to the crisis of the day.
A Pragmatic View
The individual mandate that is causing all this excitement is not in reality much of a mandate. It assesses a penalty under the Internal Revenue Code for not having insurance but it explicitly denies the IRS the power to collect the penalty by liens and levies. I suppose that does not change the principle of the thing for the constitutional purists, but there probably is some other way to address the free rider problem without a federal mandate. Congress could, for example, “encourage” states to enact mandates through medicare funding. Of course, Congress isn’t going to do anything on this before the next election, so we are probably in for more courtroom drama.