What Arguments did the Supreme Court Hear on Obamacare?

On March 26, 27 and 28, the nine Justices of the United States Supreme Court sat for six hours to hear arguments on the constitutionality of the Patient Protection and Affordable Care Act. The case is officially known as Florida v. Department of Health & Human Services. A total of 26 states (including Pennsylvania) are involved in the suit.

Set aside for the moment whether or not you believe the legislation is good or bad public policy. Set aside your political views and whether you love it or hate it. Let’s examine the arguments before the court.

 Day One

The issue for argument on Monday, March 26, was the applicability of the Anti-Injunction Act, a reconstruction era law that prohibits the Courts from striking down tax laws before they take effect. Both parties to the suit, the administration and opposing 26 states agreed that the act did not apply. The Supreme Court appointed a third party, Washington D.C. lawyer Robert Long, to argue the position that the Court has no jurisdiction to hear the case because of the Anti-Injunction Act.

The administration’s position presented by Solicitor General Donald B. Verrilli Jr. was that the "penalty" imposed on persons who do not purchase medical insurance in accordance with the mandate, although collected by the internal revenue service with the income tax and dependent on income levels, is not itself a tax, therefore the Anti-Injunction Act is inapplicable.

Justice Samuel Alito broke in to say: "General Verrilli, today you are arguing that the penalty is not a tax. Tomorrow you are going to be back and you will be arguing that the penalty is a tax. Has the court ever held that something that is a tax for purposes of the taxing power under the Constitution is not a tax under the Anti-Injunction Act?"

 

 Day Two

:The individual mandate portion of the law goes into effect on January 1, 2014. It requires virtually all Americans to obtain health insurance or pay a penalty. On Tuesday March 27, the Supreme Court heard two hours of oral argument on the mandate and whether it is constitutional under the Commerce Clause. The Commerce Clause is found in the United States Constitution Article I, Section 8, Clause 3, and states that Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes."

The administration’s argument is that the mandate to buy health insurance or else pay a penalty is a permitted regulation of interstate commerce. The states argue that not buying something (health insurance) is not engaging in commerce and, therefore, can’t be regulated by the federal government.

While the administration relied heavily on the Commerce Clause, they also provide an alternative argument: that the individual mandate to buy insurance or pay a penalty is a valid exercise of Congress’ taxation power as provided by the General Welfare Clause, Article I, Section 8, Clause 1, (even though they argued that the penalty for non-compliance was not a tax in order to avoid the Anti-Injunction Act). The General Welfare Clause reads: "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States. . ."

The states argued that the individual mandate and penalties for noncompliance with the mandate do not fall under Congress’ taxation powers under the General Welfare clause because Congress and the administration have gone to great lengths to specify in the legislation, as well as the debate about that legislation, that the penalty for noncompliance was a penalty, not a tax.

Paul Clement, arguing for the 26 states who oppose the mandate argued that if the government can mandate that everyone has to purchase health insurance, then what can’t it mandate? Where, exactly, does the line get drawn if the Court upholds the individual mandate and what might a future Congress do with this new found power. The Justices asked about requiring people to buy cell phones, burial services, even broccoli - because it is good for you.

 

Day Three 

The issue for argument on Wednesday March 28 was severability, that is, whether the rest of the health care law can stand if the individual mandate provision is found unconstitutional.

The states contend that if the individual mandate to buy insurance or pay a penalty is found to be unconstitutional, the entire Patient Protection and Affordable Care Act should be struck down.

The administration says that if the mandate is considered unconstitutional, only two major provisions of the law would have to fall, but the rest of the law can stand. Deputy Solicitor General Edwin Kneedler, on behalf of the Obama administration, argued that only the ban on pre-existing conditions and cap on the cost of policies should be turned down if the mandate was gone.

Here is the relevant precedent from the 1987 case Alaska Airlines v. Brock: "Unless it is evident that the Legislature would not have enacted those provisions which are within its power, independently of that which is not, the invalid part may be dropped if what is left is fully operative as law."

The Supreme Court has to figure out, based on documentation of Congress’ deliberations, whether or not Congress would have intended to pass the law without an individual mandate, and also if the law is workable, as a matter of policy, without the mandate.

 

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