Our apologies for not getting this post up sooner, but as you can see, it’s been busy around here!
As you’ll recall, challengers of the Affordable Care Act are claiming that the federal government does not have the power to require people to purchase health insurance. Today, the Supreme Court heard oral arguments on this question. (You can hear the audio and read the transcript)
Here are some key points:
- What’s known as the “Commerce Clause” of the United States Constitution, found in Article I, Section 8, Clause 3, provides that Congress shall have the power “To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” The second clause is known as “the Interstate Commerce Clause,” and that’s the power at issue in Tuesday’s arguments.
- No one disputes that the insurance market impacts interstate commerce, but there are limits on the federal government’s ability to regulate, and opponents of the law claim that asking everyone to buy insurance is allowing the government to go too far.
- However, the federal government already regulates the insurance and healthcare markets with laws like HIPAA (privacy) or ERISA (employee benefit plans). And Congress has always been allowed to regulate economic activity that has a significant impact on interstate commerce, which the healthcare and insurance industries do.
- The more conservative justices expressed concern on the issue of a “limiting principle.” In other words, if the government can require someone to purchase insurance, would there be any limitations on what the government could require of an individual in the future? But there are two elements to this case that make it different:
- First, when Congress is enacting a comprehensive scheme, the Necessary and Proper Clause gives it the authority to include regulation, if it is necessary to counteract risks that come about when people engage in economic activity that undercuts the scheme as a whole.
- Second, Congress has the power to regulate the method of payment at the point of sale, and because everyone will require healthcare services at some point, Congress can require the purchase of insurance to prevent everyone else from having to pay for your health care after you access it.
- The other major question is whether Congress has the power to require people to pay a penalty under its taxing power. Other penalties have been upheld as exercises of Congress’ taxing power, when the purpose was to encourage, or discourage, people from taking a certain action.
- Illuminating quotes:
- Justice Ginsburg: “What was unique about this [insurance market] is it’s not my choice whether I want to buy a product to keep me healthy, but the cost that I am forcing on other people if I don’t buy the product sooner rather than later.”
- Justice Sotomayor: “Because virtually no one, perhaps with the exception of 1 percent of the population, can afford the massive cost if the unexpected happens . . . when you go for health services, you have to pay for insurance, and since insurance won’t issue at the moment that you consume the product, we can reasonably, necessarily tell you to buy it ahead of time, because you can’t buy it at the moment that you need it.”
- Justice Kagan: “Congress can regulate the transaction [purchasing insurance], and the question is when does it make best sense to regulate that transaction? And Congress surely has within its authority to decide, rather than at the point of sale, given an insurance-based mechanism, it makes sense to regulate it earlier. It’s just a matter of timing.”
- Justice Alito: “. . . here the reason why there is cost shifting is because the government has . . . required hospitals to provide emergency treatment, and instead of paying for that through a tax which would be born by everybody. . . it has set up a system in which the cost is surreptitiously shifted to people who have health insurance and who pay their bills when they go to the hospital.”
Most legal analysts agree that four justices (Breyer, Ginsburg, Kagan, and Sotomayor) will vote to uphold the ACA in its entirety. Justice Thomas is expected to rule that the ACA, particularly the individual responsibility provision, is unconstitutional, and Justice Alito is likely to do the same. Many believe that Justice Kennedy will be the one to provide a fifth vote in favor of upholding the ACA, and he may bring Justice Roberts, and possibly Justice Scalia with him.
Again, it’s far too early to tell how the Supreme Court will rule, but we are hopeful that the Supreme Court will uphold the law in its entirety.