Posts Tagged ‘health care’

The federal Affordable Care Act calls for the creation of health insurance exchanges. States can create their own exchanges. But the federal government will step in with its own exchange if a state does not create one.

A story in today’s Richmond Times-Dispatch reports that Virginia Governor Bob McDonell “wants Virginia to operate its own health insurance exchange, but only if the U.S. Supreme Court upholds the federal mandate that all individuals have health insurance.”  According to the story, “McDonnell said he hopes the Supreme Court will strike down the individual mandate, rendering an exchange unnecessary, but he made clear that he wants Virginia to operate the exchange if the law stands.”

The story suggests a direct connection between the constitutionality of the mandate and the need to create health insurance exchanges. But the need to create health insurance exchanges will most likely remain even if the Supreme Court holds that the mandate is unconstitutional. The only way that the health insurance exchanges go away is a holding that the mandate is inseverable from the provisions of law that govern the creation and operation of health insurance exchanges. Unfortunately, severability doctrine–which governs such determinations–is murky and manipulable. The uncertainty about the health insurance exchanges is a direct result of this faulty doctrine. (For my attempt to address the problems with severability doctrine, see Partial Unconstitutionality, 85 N.Y.U. L. Rev. 738 (2010).)

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This post continues consideration of the alternative state standing theories advanced in Florida v. HHS but not yet ruled on by any federal court. An earlier post addressed the states’ lead standing theory, which is based on expenditures expected to result from the choices of some individuals to comply with the mandate by enrolling in Medicaid.

The States’ second standing theory relies on the asserted inseverability of the individual mandate from other statutory provisions that directly affect the States. Their Eleventh Circuit brief argues:

[T]he States have standing because they have alleged that the  individual mandate renders the entire Act invalid on non-severability grounds. The  States have standing to raise that argument so long as they allege that any of the  Act‘s provisions causes them injury in fact, as such injury would be remedied by a  declaration that the Act is invalid. See Brock, 480 U.S. at 684 (adjudicating claim that entire statute was invalid as a result of unconstitutional legislative veto  provision, where plaintiffs alleged injury based on other portions of the statute). The States have plainly demonstrated injury in fact caused by the Medicaid and employer mandate reforms, and therefore have standing to seek invalidation of the Act on the ground that the individual mandate is unconstitutional.

In short, the States attempt to use inseverability to leverage their standing to challenge a part of the Act that does apply to them into standing to challenge a part that does not.

I have argued in my Eleventh Circuit amicus curiae brief and in my draft law review essay that this attempted use of inseverability doctrine is unprecedented and impermissible. I will not repeat those arguments word for word here, but instead set forth some of the key moves in the analysis.


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SCOTUSBlog is running an excellent symposium on the constitutionality of the Affordable Care Act. A recent post by Abbe Gluck and Gillian Metzger touches on an important point about the remedy. They first argue that the mandate is not unconstitutional. They then argue that if the mandate is unconstitutional, then it may be severable. They write:

In the context of the Commerce Clause inquiry, the mandate is a well-tailored “necessary and proper” means by which Congress can achieve the ACA’s goals. But that does not necessarily mean that, as a remedial matter, if the mandate falls, the Court need or should do more than simply sever it and leave the rest to Congress.

This observation is accurate. The test for constitutionality under the Necessary and Proper Clause does not line up directly with the test for severability. The point has been clouded by the federal government’s litigation decision to concede the inseverability of the mandate from some of the ACA’s insurance-related provisions. This “concession” is designed to serve two functions: (1) to bolster the case for constitutionality, which may turn on whether the individual mandate is an “essential part” of a larger regulatory scheme; and (2) to increase the cost of invalidating the individual mandate.

My only objection is that Gluck and Metzger do not go far enough, endorsing only the conclusion that the mandate “may” be severable. The case can and should be made that the mandate is severable–a case that could be made along lines I suggested (albeit in a descriptive/predictive rather than forensic mode) in a guest post on Balkinization this past February:

For different reasons, the Court’s pragmatists, minimalists, and textualists have good reason to move severability doctrine away from the sort of backward-looking counterfactual speculation that yielded Judge Vinson’s holding of inseverability (i.e., the determination that the individual mandate was inseverable from the remainder of the Act because Congress would not have enacted the Act without the mandate). While a detailed doctrinal analysis to support this assertion would be more appropriate for another venue, a careful review of the Court’s severability reasoning in United States v. Booker and Free Enterprise Fund v. Public Company Accounting Oversight Board suggests directions in which the Court may be moving the doctrine. Justice Breyer’s pragmatic approach to severability in Booker is more forward-looking and consequentialist than the standard approach. Chief Justice Robert’s approach to severability in Free Enterprise Fund emphasizes the need for clear evidence that Congress intended inseverability; given the typical absence of such evidence, the result of this approach is minimalist with respect to the scope of invalidation (though the pragmatic approach is more likely to be minimalist with respect to practical consequences). Finally, textualist Justices eschew, in other contexts, the sort of exercises in imaginative reconstruction that standard formulations of severability doctrine on their face require. Perhaps they might begin to do so in this context as well. For all these reasons, it is extremely unlikely that the Supreme Court would conclude both that the individual mandate is unconstitutional and also that the remainder of the Act is inseverable.

I provide some broader reasons, not specific to the mandate question, for disallowing inseverability doctrine’s expansion of holdings of unconstitutionality in Partial Unconstitutionality, 85 N.Y.U. L. Rev. 738 (2010).

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The Fourth Circuit was the first federal Court of Appeals to hear oral arguments in cases challenging the minimum essential coverage provision (a/k/a the individual mandate) in the Affordable Care Act. On May 10, a three-judge panel heard arguments in two cases: Liberty University v. Geithner and Virginia v. Sebelius. The first is an appeal from a decision of Judge Moon in the Western District of Virginia dismissing the challenge to the individual mandate for failure to state a claim. The second is an appeal from a decision of Judge Hudson in the Eastern District of Virginia granting summary judgment to Virginia on the ground that the individual mandate is unconstitutional (but severable from the remainder of the Act). Here are a few things to look for when the Fourth Circuit rules:

The Bottom Line: Will the court reach the merits of the individual mandate’s constitutionality in both cases? Much of the oral argument in Virginia v. Sebelius focused on alleged jurisdictional defects. The individual mandate imposes an obligation on individuals but not on states. Virginia traces its right to challenge the mandate to state legislation declaring (with some minor exceptions) that no Virginia resident shall be required to obtain or maintain insurance. Legislatures in several other states have passed similar laws. The federal government’s appeal in Virginia v. Sebelius squarely presents the question whether such legislation authorizes states to sue the federal government for a federal court ruling addressing the conflicting commands of state and federal law.

If the Court Gets to Yes, How: Although everything is speculative until the court rules, the panel at oral argument appeared more likely than not to uphold the individual mandate against the constitutional challenge that its enactment exceeded Congress’s limited and enumerated powers.  If the panel decision does uphold the mandate’s constitutionality, the grounds on which it does so could matter. The federal government has invoked not only Congress’s authority under the Commerce Clause and Necessary and Proper Clause, but also Congress’s power to tax. Thus far, no federal court has upheld the mandate as an exercise of the taxing power. Some courts have rejected the federal government’s reliance on the taxing power, while others have found it unnecessary to reach the issue after concluding that Congress’s power to regulate commerce was sufficient. Although most of the merits discussion at the oral arguments focused on the Commerce Clause and the Necessary and Proper Clause, the judges on the panel also expressed interest in analyzing the parties’ arguments about the extent of Congress’s taxing power. A desire to reach the merits of the taxing power arguments may explain an order for supplemental briefing by the parties to address a statute that bars certain challenges to the assessment of taxes.

Percolation Effects: One of the reasons that the Supreme Court does not get immediately involved in issues that arise in multiple lawsuits spread across the country is that the percolation of cases in the lower courts can help to clarify, and perhaps resolve, some issues. This process can aid the Supreme Court’s ultimate resolution by sharpening the arguments and developing the implications of various lines of reasoning. It will be interesting to see whether the Sixth Circuit’s opinions in the mandate litigation (Thomas More Law Center v. Obama) have informed any of the Fourth Circuit’s opinions, and, in turn whether the Fourth Circuit’s opinions inform the Eleventh Circuit’s and, ultimately the Supreme Court’s. (Of course, there is always the chance that the Eleventh Circuit’s opinions will come down before the Fourth Circuit’s in which case it will be interesting to see whether the Eleventh Circuit’s opinions influence the Fourth Circuit’s.)

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