The Supreme Court Oral Arguments: What Will Happen to the Affordable Care Act?

Shelby Emmett

The Supreme Court began three days of oral arguments on Monday to determine the constitutionality of the Affordable Care Act. The Supreme Court tackled four key issues:

          • The Anti -Injunction Act
          • Individual Mandate
          • Severability of the Law
          • Expansion of Medicaid

Read on for more information about each issue and the arguments made around them.

Anti-Injunction Act

The Anti-Injunction Act is a federal statute that, in essence, says a citizen must pay a tax first before they can sue over it. Since the “penalty” in the Affordable Care Act does not take effect until 2014, the Supreme Court first has to determine if the “penalty” was a tax and if so, determine whether or not it is subject to the Anti-Injunction Act.

The Individual Mandate

On the second day, the Court heard arguments over the constitutionality of the individual mandate—a provision in the law which requires all Americans, with very few exceptions, to obtain health insurance or face a penalty.

The government did not argue the validity of the individual mandate very well.  This became clear when the Justices reminded the government attorney he had five minutes remaining in his time and the lawyer replied, “Lucky me.”

The Supreme Court, particularly Justice Antonin Scalia, seemed very concerned about the extent of the federal government’s power to “force citizens to enter into private contracts” and wondered how far this new power would extend. The more liberal Justices, including Justices Kagan and Breyer, seemed to also be somewhat concerned about the governments reach, but also justified the expansion in the same way social security was justified over 70 years earlier.

Historically, the United States Supreme Court has defined “commerce” as “activity between the states” or “substantial activity within a state.” The Petitioners argue no commerce is taking place by a citizen who chooses not to enter the healthcare market and therefore the government’s position that they can regulate this market under the commerce clause is unconstitutional.

The Attorney for the government on the other hand, argued in essence that all Americans will “eventually” end up in commerce because all of us at one point or another will need health care and thus the commerce clause is proper justification for the individual mandate The Justices seemed skeptical of this, especially Justice Scalia who asked, “We are all going to need burial or cremation services too, are you saying the government can force us to buy burial services since eventually we will need it?” This same analogy was used to discuss cell phone use and 911 service, requiring pediatric coverage in insurance plans even for people without children, and of course, the already-infamous, “Can the government under this Act require citizens to buy broccoli?”

The government also argued that the mandate is necessary and a proper extension of the federal government’s power because the uninsured force the insured to cover their cost.  Justice Kennedy asked, “But isn’t the only reason there is cost-sharing because you (the federal government) force emergency rooms to treat the uninsured? Is that a constitutional basis to extend power?” The government shot back that it is against our “social norms” as Americans to turn away the sick—a very compelling  social policy justification for the law, but not a strong constitutional justification according to the conservative wing of the court.

The Severability Issue

On the third day, the Justices heard arguments over the severability of the law—if the mandate is found unconstitutional must the whole law be struck down or just sections of it?

The Affordable Care Act did not pass with a severability clause. In order for the bill to pass the Senate with only 51 votes, Majority Leader Harry Reid, (D-NV), passed it through the budget reconciliation process. Reconciliation does not allow for amendments that do not have a budget impact, so therefore no severability clause could be added.

The administration argued if the individual mandate is struck down then two key provisions of the law would have to go—the requirement that insurance companies accept everyone, and the ban on insurance companies from charging more for sick people.

The petitioners, 26 states, and the National Federation of Independent Business (NFIB) argued the mandate is so closely linked to the effectiveness of the other portions of the bill that all of it would have to be thrown out and further argued Congress’ intent was to have the whole law work together not just individual pieces.

Justice Ginsburg argued if some of the law is deemed unconstitutional, it would be best to leave the rest of the law in place and leave it up to Congress to make any changes it deemed fit. Justice Scalia asked the government attorney if he really expected the Justices to go through all 2,700 pages of the bill and pick and choose which provisions to keep.

Expansion of Medicaid

Lastly, the Court discussed the expansion of Medicaid under the Affordable Care Act. The States argued Medicaid is a voluntary program and threats by the federal government to withhold all Medicaid funding for refusing to voluntarily enter into the Medicaid expansion provision is by definition coercion and thus unconstitutional.

The Medicaid issue seems to be the petitioner’s weakest argument, while the constitutionality of the individual mandate seems to be the strongest argument.

The Supreme Court is likely to reach a decision on the fate of the Affordable Care Act in May or June of this year. It is impossible to know how the Supreme Court will rule simply by hearing their questions and analysis, but we do know there are “conservative” wings of the court and “liberal” wings of the court, which will likely affect the outcome of the final decision.

Justice Kennedy, a Reagan appointee, is likely to decide the fate of the Affordable Care Act because he is usually a “swing vote”. In some cases he has been fearful of expanding federal power and in other cases has been willing to expand it. Justice Kennedy seemed to be suspicious of the mandate, concerned how far the government could extend its power, but also gave signals he may be open to the mandate when he suggested the “uniqueness” of the health care market.

Backup Plans if the Affordable Care Act is found Unconstitutional

The Obama Administration stated this week that there are no contingency plans if the law is struck down.  Healthy Teen Network will keep you updated regarding the outcome of the case. Stay tuned for further information about the State Insurance Exchange implementation and what you can do in your state to influence the process.

Shelby Emmett, JD is the Policy and Legal Coordinator at Healthy Teen Network.

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