Tag: individual mandate

More Proof ObamaCare Is a Sop to Industry

Reuters has helpfully published another article demonstrating that ObamaCare’s biggest cheerleaders are the insurance and drug industries.  That’s because, barring repeal and despite the Obama administration’s fatuous rhetoric about standing up to the special interests, ObamaCare will shower those industries with massive subsidies.  Excerpts follow.

Health Overhaul Should Press Ahead: Industry
By Susan Heavey

Thu Nov 11, 2010 1:39pm EST

NEW YORK (Reuters) - Repeal reform? No thanks, say health insurers, drugmakers and others looking for a clearer picture of the U.S. healthcare market after the bruising passage of the controversial overhaul law…

The new healthcare law created “a stable, predictable environment, however painful it has been in the short term,” GlaxoSmithKline Plc’s (GSK.L) Chief Strategy Officer David Redfern said at the summit in New York.

“When you are running a business, the hardest thing is changing policy and a changing environment because it is very difficult to plan, predict and ultimately invest in that sort of scenario,” he said, echoing other speakers.

True enough.  How’s a firm supposed to develop a business plan around uncertain taxpayer subsidies?

Health officials must still hammer out how to implement the law and finalize hundreds of new rules and regulations. Many such details are key, as the sector looks to adjust its business for 2011 and beyond.

Wait, I thought the law created a “stable, predictable environment” and repeal would create uncertainty.  Hmmmm.

“Anti-reform made good talking points before the election,” said the Department of Health and Human Services’ Liz Fowler, adding that people “will find more to like than to dislike” in the law once it is more in place.

Boy, they just won’t let go of that chestnut, will they?  Remember: voters need re-education, not the Obama administration.

Even insurers, which were vilified by Democrats in passing the reforms, said they don’t want a repeal, even as they push for clarity on forthcoming rules and seek additional changes.

Cigna Corp CEO David Cordani and Aetna Inc President Mark Bertolini both urged the nation to move forward on the overhaul.

Even the insurance industry is against repeal?  The folks whose products the law will force 200 million Americans to purchase?  Never saw that coming.

Since the start of 2009, the Morgan Stanley Health Care Payor index has risen 75 percent, outperforming a roughly 35 percent rise for the broader Standard & Poor’s 500 index.

You don’t say.

Unlike insurers[!], drugmakers have escaped largely unscathed under the law, although there is still incentive to shape it.

You don’t say.

Tea Party Not Keen on RomneyCare

The following exchange took place yesterday on the Christian Broadcasting Network between host David Brody and Tea Party Express Chairwoman Amy Kremer.

Brody: Mitt Romney…on the Massachusetts health care situation, you’re going to tell me that’s going to fly in the Tea Party movement?

Kremer: Absolutely not…I’m being honest here…You can’t get away from that.  And that’s the thing is, the days of people being able to do one thing in their state in front of a microphone, and then going to Washington and doing something else. I mean, the Internet, and 24-hour news cycles changed it all, and these people don’t have short memories, they’re digging up everything from the past, and they’re not going to let go of the health care.

Hmm.  I wonder why…


Video of the CBN exchange is available here.  For more on RomneyCare, read “The Massachusetts Health Plan: Much Pain, Little Gain.”

ObamaCare Takes a Shellacking

It wasn’t just the party of ObamaCare or its champion that took a “shellacking” at the polls yesterday.  The law took a shellacking as well.  One pollster reports:

This election was a clear signal that voters do not want President Obama’s health care plan.  Nearly half (45%) of voters say their vote was a message to oppose the President’s plan….

Arizona and Oklahoma passed constitutional amendments designed to block ObamaCare’s individual mandate.  Many new governors either plan to join the 22 states already challenging ObamaCare in court, or to block its implementation in other ways.  Congressional Republicans appear determined to use every tool in their arsenal to repeal it.

President Obama is striking a conciliatory note, saying he is open to “tweaks:”

If the Republicans have ideas for how to improve our healthcare system, if they want to suggest modifications that would deliver faster, more effective reform… I am happy to consider some of those ideas.

There is room to doubt his sincerity.  The Washington Post has reported that when President Obama begins a sentence with, Let me be clear, it is “a signal that what follows will be anything but.”  Obama has likewise claimed open-mindedness and flexibility when his behavior exhibited the opposite qualities.  (Remember how last year’s White House summit on health care was all about gathering “the best ideas.”)

Yet with a firm conviction that facts and science and argument still matter, I resubmit to President Obama this Cato Policy Analysis: Yes, Mr. President: A Free Market Can Fix Health Care.  In fact, a free market is the only thing that will.  But a reasonably free market is impossible with ObamaCare still on the books.

I doubt the president will read it.  But Republicans should.  They seem pretty solid on Repeal.  They’re weaker on Replace.

Anti-Obamacare Rulings a Trend or Just Coincidence?

I’m fond of saying that lawsuits don’t proceed at Internet speed – meaning that people are disappointed when I tell them that a new constitutional challenge to uphold property rights or free speech or individual liberty generally will take years to get through the courts, or that we’ll have to wait several months for a court to issue an opinion in some front-page case.  But lately it does seem that developments from the ongoing legal challenges to Obamacare are coming faster and faster, as if the train has now left the station and, to badly mix metaphors, it’s snowballing to an eventual collision at the Supreme Court.

That “gaining speed” phenomenon is mainly coincidence – given the more than 20 Obamacare lawsuits out there, briefing schedules, hearings, and rulings are bound to overlap at some point – but it has been interesting to compare and contrast the events of the last 10 days.  To recap some of the high points, this summer Judge Henry Hudson denied the government’s motion to dismiss Virginia’s law suit (read my comments here and Cato’s brief here).  Then two weeks ago, Judge George Steeh granted a similar motion in a case brought by the Thomas More Law Center in Michigan – in a cursory opinion I react to here and critique in this op-ed.

Last Thursday, Judge Roger Vinson issued a 65-page opinion allowing most of the lawsuit brought by 20 states, the National Federation of Independent Business, and two individuals to proceed (my reaction here).   This is an important ruling spelling out the unprecedented nature of the power Congress purports to assert here, with the individual mandate of course but also in potentially commandeering state officials and coercing them with strings attached to Medicaid funds and other regulatory burdens.

Finally, yesterday Judge Hudson held a hearing in Richmond on the parties’ cross-motions for summary judgment – which means both sides agree that no material facts are in dispute and the court should go ahead and rule on the law without having a trial.  (Cato filed a brief for this stage of proceedings as well.)  By all accounts, the hearing went well for Virginia; Judge Hudson was skeptical of the government’s argument that individual decisions not to enter the insurance marketplace was the sort of “local economic activity that has a substantial effect on interstate commerce” that the Supreme Court has said marks the outer bounds of Congress’s power under the Commerce Clause.  The judge also indicated that he would issue an opinion by the end of the year.

This is all heartening news – the courts that are seriously grappling with these lawsuits (and especially the highest profile cases brought by the 21 states) actually think the Constitution places limits on federal power.  Then again, I can’t believe that question is even up for discussion!  Stay tuned – and keep track of all the lawsuits at healthcarelawsuits.org.

Obamacare Suffers Another Legal Blow

Yes, Speaker Pelosi, the constitutional concerns people have with the health care legislation you rammed through Congress despite overwhelmingly negative public opinion are serious. The Florida court’s ruling, denying the government’s motion to dismiss the challenge to the new health care law brought by 20 states and the National Federation of Independent Business, mirrors the one we saw in July in Virginia’s separate lawsuit. These have been the most thoroughly briefed and argued lawsuits, so these significant and lengthy opinions conclusively establish that the constitutional concerns raised by the individual mandate and other provisions are serious. Nobody can ever again suggest with a straight face that the legal claims are frivolous or mere political gamesmanship.

And that should come as no surprise to those who have been following the litigation because the new law is unprecedented – quite literally, without legal precedent – both in its regulatory scope and its expansion of federal authority. Never before have courts had to consider such a breathtaking assertion of raw federal power – not even during the height of the New Deal. “While the novel and unprecedented nature of the individual mandate does not automatically render it unconstitutional,” Judge Vinson observed, “there is perhaps a presumption that it is.”

This means at the very least that “the plaintiffs have most definitely stated a plausible claim with respect to this cause of action.”

Just so – and the deliberate consideration that these district courts are giving to these serious constitutional arguments (unlike the Michigan judge’s perfunctory treatment last week) indicates that the probability that the Supreme Court will ultimately strike down the individual mandate continues to increase.

Michigan Court Wrong on Obamacare, Even Exceeds Its Own Powers

The passage of Obamacare heralded an important discussion on whether the Constitution places any effective limits on federal power and, in particular, where Congress gets the constitutional warrant to require every person to enter the private marketplace and buy a particular good or service.  This is a healthy discussion to have, including in the courts.  

Today’s ruling in Michigan, dismissing the Thomas More Law Center’s challenge to the individual mandate, while disappointing to those of us who believe that the government lacks the power to commandeer people to engage in transactions – “economic mandates,” as it were – is but one of many legal decisions we can expect on the way to the Supreme Court’s ultimate resolution of this important issue.  Indeed, this summer we saw a ruling by a federal judge in Virginia allowing that state’s legal challenge to the individual mandate and other aspects of the health care legislation to proceed.  And last month, a federal judge in Florida heard arguments in a similar lawsuit brought by 20 other states – a decision on which we can expect later this fall.  Other serious cases continue in Arizona, Missouri, Ohio, the District of Columbia, and elsewhere.

Perhaps most notable about the Michigan opinion, however, is the scant space spent on the serious Commerce Clause arguments on which hundreds of pages have been filed in these cases by top lawyers, legal experts, and academics (including Cato – yes, I’m heavily vested in this litigation).  After granting that the plaintiffs had standing and that the case was ripe for adjudication, and rejecting the government’s odd Anti-Injunction Act defense, Judge Steeh takes only seven and a half pages to reject the plaintiffs’ arguments – half of which is spent reciting existing doctrine.  It is as if the court merely issued a “placeholder” opinion, pending a “real” resolution on appeal.

And the novel conclusion we gain from this curt disposition is that Congress can now regulate people’s “economic decisions,” as well as do anything that is part of a “broader regulatory scheme.”  If the Supreme Court eventually upholds the kind of reasoning Judge Steeh used here, nobody would ever be able to claim plausibly that the Constitution limits federal power.  Finding the individual mandate constitutional would be the first interpretation of the Commerce Clause to permit the regulation of inactivity – requiring an individual to engage in economic activity. 

The federal government would then have wide authority to require Americans engage in activities of its choosing, from eating spinach and joining gyms (in the health care realm) to buying GM cars.  Or, under Judge Steeh’s “economic decisions” theory, Congress could tell people what to study in school or what job to take.  That may be the unfortunate state of the law in a few years – once the Supreme Court has weighed in, and I doubt it would ever go so far in any event – but it is not up to district courts to extend constitutional doctrine on their own.

Yes, Virginia, Congress Is Not Santa Claus and Is Bound by the Constitution

The legal battle against Obamacare continues. In June, a district court in Richmond denied the government’s motion to dismiss Virginia’s lawsuit (in opposition to which Cato filed a brief).  Despite catcalls from congressmen and commentators alike, it seems that there is, after all, a cogent argument that Obamacare is unconstitutional!  

Having survived dismissal, both sides filed cross motions for summary judgment—meaning that no material facts are in dispute and each side believes it should win on the law.  Supporting Virginia’s motion and opposing the government’s, Cato, joined by the Competitive Enterprise Institute and Georgetown law professor (and Cato senior fellow) Randy Barnett, expands in a new brief its argument that Congress has gone beyond its delegated powers in requiring that individuals purchase health insurance.

Even the cases that have previously upheld expansive federal power do not justify the ability to mandate that individuals buy a product from a private business.  Those cases still involved people that were doing something—growing wheat, running a hotel, cultivating medical marijuana.  The individual mandate, however, asserts authority over citizens that have done nothing; they’re merely declining to purchase health insurance.  This regulation of inactivity cannot find a constitutional warrant in either the Commerce Clause, the Necessary and Proper Clause, or Congress’s taxing power.  Such legislation is not “necessary” to regulating interstate commerce in that it violates the Supreme Court’s distinction between economic activity (which often falls under congressional power as currently interpreted) and non-economic activity (which, to date, never has), it is not “proper” in that it commandeers citizens into an undesired economic transaction.  

Finally, the taxing power claim is a red herring: (a) neither the mandate nor the penalty for not complying with the mandate is a tax, and is not described as such anywhere in the legislation; (b) even if deemed a tax, it’s an unconstitutional one because it’s neither apportioned (if a direct tax) nor uniform (if an excise); (c) Congress cannot use the taxing power to enforce a regulation of commerce that is not authorized elsewhere in the Constitution.

The district court will hear arguments on the cross-motions for summary judgment in Virginia v. Sebelius later this month and we can expect a ruling by the end of the year. 

Obamacare delenda est.