On October 7, federal district judge George Steeh of Michigan ruled that the new federal health care law’s individual mandate, requiring all individuals to buy health insurance or pay a fine, was within the authority of the U.S. Constitution’s commerce clause.
But last Thursday, a different federal judge, Florida’s Roger Vinson, ruled that the individual mandate’s constitutionality remains to be determined and set a December 16 hearing “for the benefit of additional argument and all evidence in the record that may bear on the outstanding issues.” He granted standing but did not rule on the merits of the case.
Here are the nubs of these two district court decisions:
Commerce clause and aggregate effect, economic activity v. inactivity: Opponents of the individual mandate argue that the commerce clause cannot be used to govern economic inactivity, i.e., not buying health insurance. As Vinson observed, the mandate cannot be “based on citizenship and on being alive.”
“The power,” he adds, “that the individual mandate seeks to harness is simply without prior precedent.” Courts pay considerable attention to stare decisis, i.e., court precedents.
Proponents counter that both economic activity and inactivity “taken in the aggregate substantially affect interstate commerce.” This was the position taken in the Raich case in 2005. Angel Raich argued that she grew marijuana in her own back yard for personal medical use only. The Supreme Court nonetheless ruled that her action violated the commerce clause. If everyone grew pot, it would evolve into interstate commerce.
Rational basis: Proponents of the mandate argue that there is a rational basis for compelling individuals to buy health insurance because it is virtually inevitable that they will use the services of the medical system, such as in emergency rooms. It is therefore “rational” that they should be compelled to join the risk pool. Moreover, if they don’t contribute to the risk pool, the health care act will disintegrate financially.
Standing, ripeness: For a case to have standing and be ripe for adjudication there must be “harm” or “imminent harm.” Defenders of the mandate argue that individuals will not be harmed until the mandate takes effect in 2014.
But both judges Steeh and Vinson ruled that the plantiffs’ case has standing and is ripe. Vinson opined that future harm is “certain,” whether for individuals or for states in the form of coerced Medicaid payments that might “bankrupt the states.” States have therefore cited the 10th Amendment’s enumerated power of state sovereignty.
Tax or penalty? Mandate proponents argue that the fine for not buying health insurance is a “tax,” therefore permitting Congress under the 16th Amendment “to lay and collect taxes.” But citing a multitude of precedents, Judge Vinson flatly rejects the U.S. Department of Justice’s claim that a “penalty,” so stated by Congress in the act, is a “tax.”
Judge Vinson retorts, “Congress did not call it a tax, despite knowing how to do so.” We are asked to believe “that Congress really meant to say one thing when it expressly said something else.”
The constitutionality of the individual mandate will be a close call because judges have differing judicial philosophies. With no severability clause, the entire health care act will go down if any part is found unconstitutional.
A final editorial observation: If the commerce clause can be used to regulate all economic activities “in the aggregate,” then there is no economic activity or even inactivity in this country that cannot be regulated by Congress. This real possibility should disturb everyone-liberal or conservative.
Ronald L. Trowbridge, Ph.D. is a Senior Fellow at the Texas Public Policy Foundation, a non-profit, free-market research institute based in Austin. He served as chief of staff to the late U.S. Supreme Court Chief Justice Warren Burger and to the Commission on the Bicentennial of the U.S. Constitution.