With the Affordable Care Act individual mandate’s day of destiny before the Supreme Court fast approaching (oral arguments are set for March 27-28), some ACA supporters are now quietly fretting whether a way could have been found to finesse this whole skirmish with the most conservative justices in three quarters of a century. Such anxieties were recently vented—and, presumably, stoked—in two recent New Republic articles by Princeton health-policy historian Paul Starr. Starr acknowledges that, like all social insurance programs, the ACA needs a strong stick to motivate beneficiaries to contribute their share to the insurance fund before they collect benefits. But, he asserts, the way the ACA’s drafters and defenders packaged its incentive mechanism amounts to a tragic “legal miscalculation.” If only they had cast it purely as an exercise of Congress’ authority to levy taxes, Starr insists, rather than as a regulation of interstate commerce, the ACA would now be as good as home free in the Supreme Court: As he put it: “[T]hey could almost certainly have made the law bulletproof by framing it unambiguously under the taxing power of Congress.”
As a wise champion of progressive health policies, Paul Starr’s stature is beyond question. But on this matter of legal strategy, his certitude seems naive. Indeed, especially in light of the ACA mandate’s actual track record in court to date, his take seems downright backward.
Starr is not alone in looking favorably on a tax-based approach. Indeed, in 2009, House Democrats chose precisely that model. The health-reform bill they passed contained no express “mandate” to purchase insurance. It simply imposed tax penalties on those who could afford to get insurance but failed to do so. But the bill signed into law by President Obama was the Senate-passed version, which combined an express mandatory insurance requirement with tax penalties—similar to those in the House bill—for noncompliance. Congressional Democrats were obliged to forego a House-Senate conference that could have integrated the two bills—but requiring a floor vote in the Senate—after they lost their filibuster-proof Senate majority to Scott Brown’s upset win of the late Ted Kennedy’s vacant Massachusetts seat. That was when the bill became more rooted in the Commerce Clause as opposed to the tax power.
Was that bump in the road, seemingly inconsequential at the time, actually the place where the now-looming Supreme Court battle was lost? Not likely.
When Congress was debating the legislation, as Starr himself acknowledges, the case for tethering the mandate to the Commerce Clause power appeared simple, clear, and, well, bulletproof. As former Reagan Solicitor General Charles Fried testified to the Senate Judiciary Committee, the business of insuring health care, which represents nearly 18 percent of the national economy, is “of course” commerce, and so, “the health care mandate is a regulation of commerce, explicitly authorized by Article I [of the Constitution].”
“In any event,” he concluded, “it is a necessary and proper part of [the overall ACA scheme for regulating] health insurance that Congress chose to enact.” Q.E.D.
The Republican politicians and activists who took the ACA mandate to court did not themselves dispute such logic. They knew Supreme Court precedent gave them what George Washington University law professor Orin Kerr, a sometime adviser to Texas Republican Sen. John Cornyn, termed a “less than one percent chance” of success. They sued anyway. The steam powering their opposition sprang from two sources: 1) partisan politics, part Tea Party zeal and the desire to discredit Barack Obama and obstruct his agenda; and 2) a hope, animating the libertarian legal advocates who staffed the lawsuits, of replacing existing law with pre-New Deal, so-called “Lochner Era” doctrines that would invalidate substantially all 20th-century regulatory, civil rights, and safety net legislation. This libertarian brand of judicial activism had consistently been scorned by mainstream conservative legal leaders, including Robert Bork, Antonin Scalia, Anthony Kennedy, and John Roberts.
Will the conservative justices (other than openly libertarian Clarence Thomas) continue to toe this line of respect for precedent and judicial restraint? The fate of the ACA mandate turns on that question. It is surely a live one, as cases like Bush v. Gore and Citizens United admonish. But any inclination the court’s conservatives may have to execute a sharp right-face will not be bolstered by the fact that the ACA mandate looks more like a regulation than a tax.
If they have the political will to overturn it, libertarian doctrinal rationales limiting the tax power would get the job done, no less than similarly reactionary approaches gutting Congress’ commerce power. Indeed, lawyers representing ACA opponents have urged the courts to exhume long-defunct tax decisions—of necessity, since the administration’s lawyers have cited both the tax and commerce power in support of the mandate.
Some lower-court judges hostile to the ACA have even gone along. Just over a year ago, Virginia District Judge Henry Hudson, in approving Virginia Attorney General Ken Cuccinelli’s challenge to the mandate, relied on a notorious 1922 decision known as the Child Labor Tax Case, which barred Congress from imposing heavy taxes to discourage child labor on the theory that a predominantly “regulatory purpose” rendered a tax constitutionally invalid. While acknowledging that the case had been “dormant” for decades, Hudson nevertheless claimed that the “regulatory purpose” restriction it announced remains good law. Had the ACA utilized a pure tax-incentive mechanism as proposed by Paul Starr or adopted by the House bill, a conservative Supreme Court bloc bent on canceling Barack Obama’s signature legislative accomplishment would be perfectly capable of taking that same tack.
If anything, the ACA mandate’s case before this court looks more robust in its current, Commerce Clause-based format. This is because relying on the tax power would make it far easier for opponents to gain traction with what has been their most compelling big-picture, quasi-legal claim: If Congress can require people to buy health insurance, it can make us buy any “commercial product,” and broccoli mandates will be just over the horizon. The constitutional text defining the tax-and-spend power (to “provide for the general welfare of the United States”) is actually far more open-ended than its authorization of Congress to “regulate commerce.”
The Commerce Clause is certainly broad—as it needs to be to assure, as Justice Kennedy has written, that “Congress can regulate on the assumption that we have a single market and a unified purpose to build a stable national economy.” But it does confine Congress to genuinely economic matters which have a significant national economic impact. In contrast, “the general welfare of the United States” would be less helpful to ACA defenders, when they confront skeptical judges’ demands to “define a limiting principle” on Congress’ power to use its taxing powers to promote policy goals not otherwise authorized by the Commerce Clause or other constitutional provisions.
Moreover, it would seem more plausible for the general populace to viscerally grasp the mandate as a regulation of the economy, rather than to accept it as a good-faith “tax.” If “health insurance mandate” has proved a potent sound-bite for stirring fears of federal power run amok, imagine how “health insurance tax” would play!
Finally, nervous-Nelly second-guessing seems oddly unmindful of the record the ACA’s strategists have actually made in the courts so far. Repeatedly, eminent conservative appellate judges have blown off opponents’ demands to overturn this allegedly “unprecedented” federal power-grab. On the contrary, Republican appointees have concluded that upholding the ACA mandate is compelled by the text of the Commerce Clause and Supreme Court precedent, that it is no more “coercive” than other measures, such as dedicated taxes and tax write-offs undergirding major existing health-insurance laws, and, even, that the ACA’s approach could be a valuable model for conservative designs to privatize other components of the social safety net.
In any event, the quest for universal health insurance is an epochal political fight, and there is no way opponents would have failed to take it all the way to the Supreme Court, no matter how it was drafted. For the ACA to work—to prevent cost-shifting by the uninsured and assure affordable coverage for people who have pre-existing medical conditions—a purchase-incentive mechanism with serious bite was indispensable. The enacted package is in as strong a position before this Supreme Court as any comparably effective provision could be.
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