Healthcare, the Constitution, and the Supreme Court

Don’t have time to listen to all 6 hours of Supreme Court argument over healthcare? Get Legal Lad’s quick summary of the issues that will determine the validity of the Obama administration healthcare law. 

Adam Freedman
5-minute read

Today’s topic: Healthcare showdown at the Supreme Court

And now, your daily dose of legalese:  This article does not create an attorney-client relationship with any reader.  In other words, although I am a lawyer, I’m not your lawyer.  In fact, we barely know each other. If you need personalized legal advice, contact an attorney in your community. 

A Marathon Session at the Supreme Court 

Almost exactly 2 years after Congress passed the Obama administration’s proposed healthcare reform – the Affordable Care Act, or ACA – the Supreme Court convened to consider the constitutionality of the law. Specifically, the Court gathered to hear the appeal of a decision by the Court of Appeals for the Eleventh Circuit striking down the central component of the law, known as the individual mandate.  The Court scheduled an unprecedented 6 hours of legal argument (spread out over 3 days) for the case.  In today’s article, I’ll explain the 4 major issues the Court is considering, and which way the justices seem to be leaning. 

Issue #1: The Anti-Injunction Act

The first issue was whether the federal “Anti-Injunction Act” barred the Court from even considering the challenge to the ACA.  The Anti-Injunction Act forbids taxpayers from challenging federal tax provisions before the tax is collected. In other words, if you want to challenge the validity of a federal tax, you’re supposed to pay the tax first and then fight with the IRS over a refund. Even though ACA isn’t exactly a tax law, the penalty for failing to obtain health insurance is a form of tax; or at least , the ACA inserts the penalty provisions into the tax code.  

The odd thing is, none of the parties to the ACA lawsuits argue that the lawsuits are barred by the Anti-Injunction Act; not even the Obama administration, which, of course, opposes the lawsuits.  However, the Federal Court of Appeals for the Fourth Circuit concluded that the Anti-Injunction Act applies and so the Supreme Court justices decided that they would have to address the issue for the sake of completeness.  If the High Court rules that the Anti-Injunction Act applies, then all legal challenges to the individual mandate will have to be postponed until 2014, when the mandate and its penalty provision actually kick in. 

At the Supreme Court, none of the justices appeared to be persuaded by the Anti-Injunction Act argument. In fact, none of the parties to the lawsuit were either – the Court had to appoint a special counsel to present the argument in favor of applying the Anti-Injunction Act so as to delay the case for two years. 


Issue #2: The Individual Mandate

On the second day of argument, the Court got to the central issue: the “individual mandate.”  This refers to a provision of ACA that creates a legal duty for virtually all individuals in the U.S. to obtain health insurance that meets federal standards by 2014.  The constitutional issue is whether Congress has the authority to impose such a mandate.  The Constitution grants only certain “enumerated powers” to Congress.  In the case of ACA, the government relies mainly on the constitutional power to regulate “commerce . . . among the several states.” 

Even though individual healthcare decisions may not involve interstate commerce, the Supreme Court has held that Congress has the power to regulate economic activity that, in the aggregate, will affect interstate commerce.  In 1942, the Court upheld New Deal regulations that dictated the amount of wheat a person could grow for his own family’s consumption (Wickard v. Filburn)!  However, opponents of ACA point out that Congress has never used its power to compel individuals to purchase a product, whether they want it or not. 

Despite early predictions that the mandate would be overwhelmingly upheld, the oral arguments revealed a Supreme Court deeply divided.  A number of justices expressed concern about the implications of the individual mandate. Justice Kennedy wondered whether the government could “create” commerce rather than merely “regulating” commerce, while Justice Scalia worried about the government creating future individual mandates for other personal matters, such as mandates to eat our broccoli. Other justices, however, clearly supported the mandate. Justice Breyer, for example, argued that not long after the Constitution was ratified, Congress “created” commerce by chartering a Bank, thus setting an early precedent for the constitutionality of legislation that initiates commerce.