Obamacare Is Facing Another Court Challenge
Article from Reason by Randy Barnett.
Readers may be familiar with a new constitutional challenge by 20 state attorneys general to the Affordable Care Act, which Ilya blogged about here. Their argument, in a nutshell, is that with the amount of the penalty for failing to have health insurance now set to zero, the individual insurance “requirement”–AKA the “individual mandate”–can no longer be justified as a tax. This is so because one of the essential characteristics of a tax is that it raises at least some revenue for the government. For this reason, the “saving construction” employed by Chief Justice Roberts no longer applies, as it is no longer even a “reasonably possible” reading of the insurance requirement, which now raises no revenue.
On this claim, the AG’s are on very strong ground. To the extent they are correct, the NFIB v. Sebelius was a bigger victory than we realized when it was decided, as it left the insurance mandate susceptible to being killed off in this way via reconciliation.
Because this constitutional claim makes sense, the attention will turn to the issue of standing and, perhaps, mainly to severability. If the insurance requirement is invalidated, does that bring down the rest of the Affordable Care Act? While we argued that the entire ACA was inseverable from the mandate, the Obama administration contended that–based on the Congressional findings–only the guaranteed issue and community rating provisions are inseverable:
Congress’s findings establish that the guaranteed-issue and community-rating provisions are inseverable from the minimum coverage provision. Congress specifically found that in a market with guaranteed issue and community rating, but without a minimum coverage provision, “many individuals would wait to purchase health insurance until they needed care.” 42 U.S.C.A. 18091(a)(2)(I). . . . Congress therefore expressly found that the minimum coverage provision is “essential to creating effective health insurance markets in which improved health insurance products that are guaranteed issue and do not exclude coverage of pre-existing conditions can be sold.” . . . . It is evident that Congress would not have intended the guaranteed-issue and community-rating reforms to stand if the minimum coverage provision that it twice described as “essential” to their success, 42 U.S.C.A. 18091(a)(2)(I) and (J), were held unconstitutional. (pp. 45-47)
Read the full story at Reason.
Image Credit: By St. Louis Circuit Attorney’s Office (Own work) [CC BY-SA 4.0 (http://creativecommons.org/licenses/by-sa/4.0)], via Wikimedia Commons