The most eagle-eyed tourists visiting Washington D.C. for the 100th annual Cherry Blossom Festival might have noticed a line forming at One First Street. Starting on Friday of last week, court watchers and assorted activists took their place in line (or, alternatively, paid someone else to stand in line for them) for the opportunity to see oral arguments in the cases filed against the Affordable Care Act. They lined up early for a good reason; this case is effectively the Super Bowl of constitutional litigation, as the Supreme Court recognized when it allotted a nearly unprecedented six hours to oral arguments over three days.
The Affordable Care Act is a comprehensive piece of legislation aimed primarily at decreasing the rate at which U.S. spending on healthcare increases. It includes a host of regulatory schemes and pilot programs, including provisions implementing the concept of care delivery by ' Accountable Care Organizations,' banning healthcare insurers from excluding people because of preexisting conditions, banning the practice of rescission of health insurance by insurers except in cases of fraud, expanding Medicaid participation eligibility, creating health insurance 'exchanges' at the state level, and authorizing the Secretary of Health and Human Services to developed bundled payment plans to alter the dynamics of the current fee-for-service model of payment for healthcare by third-party insurers. However, the most controversial provision by far (with the possible exception of a completely fictitious provision establishing 'death panels') is the so-called 'individual mandate,' which requires all adults, with certain exceptions, to carry a minimum level of health insurance or pay a penalty come tax time every year.
The Supreme Court agreed to hear arguments on four issues from two cases from the 11th Circuit Court of Appeals challenging the Affordable Care Act, specifically National Federation of Independent Business v. Sebelius and Florida v. Department of Health and Human Services. The first case, filed by the National Federation of Independent Business and two individual plaintiffs who cannot be bothered to carry health insurance and want everyone to know it, argues that the individual mandate is an unconstitutional exercise of federal power to regulate interstate commerce. The other case, filed by the Attorney General of Florida and joined by the Attorneys General of twenty five other states, also argues that the individual mandate is unconstitutional, and adds a claim that the Medicaid expansion is an unconstitutional exercise of coercive power by the federal government over the states. The four issues that the Supreme Court will be hearing are (i) whether the suits are barred by the Anti-Injunction Act, (ii) whether the individual mandate is unconstitutional, (iii) whether the Medicaid expansion is unconstitutional, and (iv) if either the individual mandate or the Medicaid expansion is unconstitutional, whether they are severable from the Affordable Care Act or whether the Act in its entirety must be struck down.
The question regarding the Anti-Injunction Act is effectively a procedure question as to the ripeness of the suit. The Anti-Injunction Act prohibits courts from hearing cases seeing to restrain the IRS from assessing a tax; in order to challenge a tax, a taxpayer has to be assessed the tax, pay it, and then seek that the tax be refunded. The penalties for not carrying health insurance don't kick in until 2014, so the argument is whether the penalty associated with not carrying health insurance is a 'tax' or a 'penalty.' If they are a tax, the Supreme Court can't render a decision on the constitutionality of the individual mandate until the penalties for not carrying health insurance are imposed. I like to think of this as the Supreme Court's escape hatch.
The argument over the individual mandate is the big fish in this pond. Congress relied on its powers to regulate interstate economic activity under the Commerce Clause at Article I, Section 8 of the U.S. Constitution in passing the individual mandate. The plaintiffs allege that the individual mandate requires individuals to purchase a commercial product, which is a regulation of inactivity rather than economic activity, and is therefore beyond the scope of the Commerce Clause. The government argues that the refusal to carry health insurance is economic activity in the sense that in many circumstances a refusal to buy health insurance is effectively a demand by an individual that taxpayers pay their medical bills for them at some point in the future. The argument over the extent of the power granted by the commerce clause is nothing new; anyone who has been to law school is familiar with Wickard v. Filburn, 317 U.S. 111 (1942), which held that growing wheat on one's farm for personal use is not beyond the reach of the power of the federal government under the Commerce Clause. Sharp law students understand Wickard v. Filburn as a demonstration that the judicial branch is subject to and conscious of the relationship between popular opinion and the ability of the courts to exercise their power; less sharp law students fondly remember Wickard v. Filburn as a demonstration that they are smarter and more true to the pure exercise of legal judgment than every member of the U.S. Supreme Court were one day in 1942.
That the Medicare expansion question was granted certiorari surprised me. Specifically, it is only the expansion of Medicaid and not the whole program itself that is being challenged. Medicaid itself appears to be comfortably constitutional as an exercise of the federal government's power to tax and spend under Article I, Section 8 of the U.S. Constitution. Complaining that Medicaid is coercive as applied to the states seems similar to complaining that the White House is white; it is true, but constitutionally irrelevant.
Finally, there's the question of the severability of either of the Medicare expansion or the individual mandate from the act. This question only comes up if the court finds that either provision is unconstitutional, but if it does come into play the entire Affordable Care Act hangs in the balance. Effectively, finding that a provision is so essential to the legislative scheme of the Act that the Act cannot function without it is a judicial undoing of the entire piece of legislation. I call this the Scorched Earth Holding. Just a little reminder, the private health insurance market before the Affordable Care Act was not functioning well at all, and indications were that, at least in some states, the marketplace had entered a death spiral. A United States without the Affordable Care Act may well soon become a United States without individual health insurance plans.
My prediction is going to disappoint you--I think SCOTUS might punt on this one. I honestly do not think that Kennedy is willing to strike down the entire Affordable Care Act, and I expect that Breyer, Ginsburg, Kagan, and Sotomayor will vote as a block for the constitutionality of each provision. While we will not be privy to the goings on in chambers, the more liberal wing does have quite a bit of leverage thanks to the severability issue; if any provision looks to have five votes against its constitutionality, they can all sign on to an opinion that the provision is not severable, thereby forcing the more conservative justices to have to go all-in on striking the entire Act down. I think it is worth noting that striking down an act duly passed by the legislature is always an act of judicial activism, regardless of the political stripe of the people supporting the holding.
But, then again, six hours of oral argument is an awful lot of sound and fury if the justices plan to simply reach a politically convenient detente. A decision that disappoints everyone, namely finding that the case can't be heard by virtue of the Anti-Injunction Act, might be the court's only chance at staying above the political fray in an election year; the question is whether the Supreme Court is actually chomping at the bit to dive into the fray full-force. Past practice says no, but the Roberts Court has signaled a willingness to render decisions that have by most measures changed long-standing precedents in American constitutional law (I'm thinking of the decisions in Citizens United v. FEC and District of Columbia v. Heller). Honestly, it's anyone's guess. And that anyone is probably named Anthony Kennedy.
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