The New Health Dialogue

A Blog from New America's Health Policy Program

HEALTH REFORM: Exploring the Constitutional Challenges

Published:  August 9, 2010
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Tony Cardona, a newly minted lawyer with an interest in health policy, is doing some work for us this summer. Here is the next in his series of posts about legal issues surrounding health reform.

One year ago, Julie Barnes, at the time the deputy director of the New America Health Policy Program, posted on this blog that according to a number of legal analysts, “if [the individual mandate] is drafted under the tax and spend powers, no problema.”

It wasn’t. The mandate was drafted under Congress’ power to “regulate activity that is commercial and economic in nature,” (ACA sec 1501(a)(1)) otherwise known as the commerce clause. Still, at the time the bill was signed into law, the government did not think there would be too much of a problema. (Legally, we mean. Obviously it’s been a political challenge all along).

Yet, as a New York Times article this summer noted, the government is moving away from the Commerce Clause as a sole defense for the constitutionality of the individual mandate. Despite President Obama’s assurance that “[f]or us to say that you’ve got to take a responsibility to get health insurance is absolutely not a tax increase,” the government’s lawyers are arguing that the mandate to buy insurance is covered under the “power to lay and collect taxes.” The government carefully chose to use the word “penalty” in the law, instead of an unpopular tax. Now, they are arguing that the “penalty” for not buying insurance is essentially a tax.

The conservative critics blogosphere lit up in response to the New York Times article. They see hope in the government’s possible change of course. If the Commerce Clause was a slam dunk, why argue anything else? The shift was not only evident in the government lawyers' arguments but also from the White House. In response to the recent decision in the Virginia lawsuit against the individual mandate, the White House Blog argued that the mandate is constitutional not only under the Commerce Clause, but also the Necessary and Proper Clause and the taxing and spending power of the General Welfare Clause (“The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States.” Article 1, s. 8, US Constitution.)

Government lawyers would have to make a strong argument for the taxing power despite the initial insistence that the individual mandate was not a tax. As stated by the Times, "Congress anticipated a constitutional challenge to the individual mandate. Accordingly, the law includes 10 detailed findings meant to show that the mandate regulates commercial activity important to the nation’s economy. Nowhere does Congress cite its taxing power as a source of authority."

Earlier this month U.S. District Judge Henry E. Hudson allowed the lawsuit filed by Virginia Attorney General Ken Cuccinelli II to proceed to a full hearing. Rejecting arguments from the Obama administration that Virginia has no standing to sue over the law, Judge Hudson’s decision breathed new life into this debate. Missouri’s primary voters also approved a referendum aimed at blocking the health insurance mandate, which may add some political energy to the ongoing debate. In Florida, a lawsuit similar to Virginia’s has been joined by 19 other states and a hearing on the Administration’s motion to dismiss is set for September 14th.

Over the next several weeks I will explore the legal arguments attached to the individual mandate: the Commerce Clause, General Welfare Clause, and the Necessary and Proper Clause. Hopefully, explaining the history and rational of each in a non-legalize yet helpful manner.

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