May it Please the Court

From March 26 through March 28, 2012, the United States Supreme Court heard arguments contesting the constitutionality of the Affordable Care Act (the health care reform, as some of us know it).  Away from the multitude of demonstrators rallying outside the building, Solicitor General Donald B. Verrilli, Jr. argued the government’s case, while Paul Clement, former Solicitor General under George W. Bush, took the challengers’ side.

The challenges focused on several aspects of the law:

Anti-Injunction Tax Act – The first day of arguments was spent on the Anti-Injunction Tax Act, an 1867 law that says people must wait until a tax goes into effect before they can challenge it in court.  Since the fines for not having insurance coverage do not go into effect until 2014, some questioned whether the Supreme Court can rule on the constitutionality of the case.  All of the individuals involved on both sides of the case argued that the Court should decide the case now, but the Court must determine that it has jurisdiction over the case, either by concluding that the Act does not affect jurisdiction or that the fine is not a tax, before evaluating the constitutionality of the ACA.  If the Court rules that the Act does prevent it from exercising jurisdiction, a decision on the constitutionality of the ACA would be delayed until at least 2015.  Press reports analyzing the arguments suggest that the Justices seemed to think they could rule on the case now.   

Individual mandate – The second day of arguments centered on the individual mandate, the ACA requirement that all citizens have health insurance coverage after 2014 or pay a fine.  Several individuals sued the government, arguing that it is unconstitutional for Congress to pass a law requiring individuals to purchase something.  Some decried the mandate as a slippery slope: Could the government one day require Americans to eat broccoli or risk paying a fine (presumably to line the pockets of Big Broccoli)?  This day of arguments was contentious and many Justices asked tough questions of both sides.  The four liberal-leaning Justices seemed to support the individual mandate while five-conservative justices were skeptical about it, but it is hard to tell based on the questioning.

Medicaid expansion – On the last day, the Court heard arguments concerning the ACA provisions that expand Medicaid eligibility to all individuals (including single adults) with incomes below 133% of the Federal Poverty Level in 2014. Medicaid is a state/federal partnership where the federal government sets broad eligibility and coverage requirements and pays part of the cost of coverage, and states cover the remaining costs and implement the program in various ways.  Several states sued the government, arguing that this provision is “coercive” since the loss of funding that would result from not implementing the expansion is so high that they have no choice but to comply with the statute’s demands.  Analysis of these arguments was mixed – some people believed that the Justices indicated skepticism about the expansion and were likely to rule it unconstitutional while others thought it was much less clear. 

Severability – Also on the last day, the Court heard arguments about how much of the entire ACA would need to be struck down if the Court held the individual mandate unconstitutional.  The arguments on both sides involved both legal and health policy aspects.  Some argue that the mandate is the trigger for a host of private insurance reforms in the law. So, if the mandate is struck down, so, too, should the entire ACA.  On the other hand, the ACA is a nearly 2700-page bill and there are numerous provisions that concern many other aspects of the health care system.  The Justices did not appear interested in reviewing the law section-by-section to determine what relates to the mandate. This may lead the Court to declare the whole law constitutional – or unconstitutional. 

There has been significant media coverage of the arguments that seek to discern the likely outcome of the cases, but it is difficult to predict, even if you listened to the entire six hours of oral arguments. We expect a decision by the high court later this spring or early summer.

Johanna Gray
Vice President

Lisa Ellington

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