Monday, December 13, 2010

One Judge Finally Finds Health Care Mandate Unconstitutional
A George W. Bush appointee has, surprise, found the health care mandate unconstitutional, claiming it overreaches Congress' power to regulate under the Commerce Clause. Of course, media will play this up as somehow a huge blow - and it's not good news to be sure. But they will probably not remind that more than one other judge has already found the provision to be perfectly legal.

This will all wind its way up the Appeals Court and ultimately be decided by the Supreme Court, like it or not. But that was going to be true no matter what this conservative judge in Virginia decided. Here's the argument, in a nutshell:
The Supreme Court’s position on the Commerce Clause has evolved through four signature cases over the last 68 years, with three decided since 1995. Two of the opinions established broad powers to regulate even personal commercial decisions that may influence a broader economic scheme. But other cases have limited regulation to “activities that have a substantial effect on interstate commerce.”

A major question, therefore, has been whether the income tax penalties levied against those who do not obtain health insurance are designed to regulate “activity” or, as Virginia’s solicitor general, E. Duncan Getchell Jr., has argued, “inactivity” that is beyond Congress’ reach.

Justice Department lawyers have responded that individuals cannot opt out of the medical market, and that the act of not obtaining insurance is an active decision to pay for health care out of pocket. They say that such decisions, taken in the aggregate, shift billions of dollars in uncompensated care costs to governments, hospitals and the privately insured.

6 comments:

Doug said...

Perhaps the administration's legal team should couch the tax penalty as a tax expenditure - maybe they have, I haven't paid that much attention. Just like you can lower your tax burden by paying interest on a home mortgage, you can reduce your tax burden by having insurance coverage. Without insurance, you pay a tax - no purchase required.

Don said...

Makes sense to me too. I haven't read the Justice Dept's briefs but I know they have gone overboard to take the teeth out of the penalty. Not going to arrest you, or put a lien on your house, or whatever.

stevie t said...

I feel like an idiot, but I don't understand that quote at all, and don't have the energy to figure it out. I do however understand your summary Don.

Don said...

Yeah if you haven't been reading the back and forth about the Commerce Clause the last few months (i.e., you have a life), that quote's pretty garbled and jargony. The gist is: Congress justifies its health care mandate by saying it can regulate anything relating to interstate commerce thanks to the "Commerce Clause" of the Constitution. Republicans counter that Congress uses that power recklessly and extends it beyond what was intended. The health care mandate to them is the perfect example of overreach, of Congress (and the courts, they say) defining interstate commerce too broadly. The legal argument on their side says that requiring someone to buy insurance isn't regulating commercial activity at all, it's regulating commercial *inactivity* (the decision *not* to participate in the health insurance market). But the government responds that deciding not to participate in the insurance market is in fact having an impact on interstate commerce because we all ultimately need health care, and this decision not to participate merely shifts the costs.

Most legal scholars seem to be firmly on the side of the government here, offering broad latitude to Congress in regulating based on the Commerce Clause. But this Judge became the first to agree with the other side.

Don said...

Doug, as for your earlier comment, last night I browsed through the decision - didn't understand most of it, but he discusses this issue of tax and penalty quite a bit at the end, whether there's a difference between the 2 (he says yes, the govt says no). He basically says it's a penalty and not a tax, and that it doesn't become a tax just by calling it one.

stevie t said...

Thanks for another good summary. In the end though, I'll just believe whatever you tell me to. I'm not a DonDittoHead. It's just that I trust you THAT much.