Commentary

The Nuts and Bolts of the ObamaCare Ruling

For months, progressives smugly labeled the legal challenges to ObamaCare as “silly” or even “frivolous.” Today their confidence must be severely shaken.

Late Monday afternoon in Pensacola, Fla., U.S. District Court Judge Roger Vinson delivered the second major judgment that the centerpiece of the Patient Protection and Affordable Care Act — the “individual mandate” that forces Americans to buy health insurance whether or not they want it — is unconstitutional.

In December, District Court Judge Henry Hudson ruled against the mandate in a separate lawsuit brought by the state of Virginia. But Judge Vinson’s sweeping and powerfully reasoned decision this week went much further, striking down the entire health-reform law on the grounds that the individual mandate was not severable from the rest of the statute. And the plaintiffs in Judge Vinson’s courtroom included the attorneys general of 26 states, not just one. His opinion thus casts a dark shadow over ObamaCare until the Supreme Court issues a final ruling on the matter.

The Obama administration attempted to cloak an unprecedented and unsupportable exercise of federal power in the guise of a run-of-the-mill Commerce Clause regulation.”

Consider the problems posed by the insurance mandate. The Obama administration argued that it was supported by the Commerce Clause, which gives Congress the power to regulate interstate commerce. True enough, insurance is commerce, but not buying insurance is the antithesis of commerce. Commerce has always been understood as requiring economic activity. This was the rationale Judge Hudson adopted in striking down the individual mandate in the Virginia case.

The government’s lawyers in the Florida case insisted that not buying health insurance was somehow different from a failure to buy other products like clothes or food. They said health insurance was “unique” because, eventually, everyone will seek and obtain health care. And if they aren’t insured, the costs will be shifted onto others, thus substantially affecting commerce.

Judge Vinson rejected this argument, recognizing that “not consuming” other products, such as food, is also unavoidable and can have substantial effects on other commercial markets. “There is quite literally no decision that, in the natural course of events, does not have an economic impact of some sort,” he wrote. “The decisions of whether and when (or not) to buy a house, a car, a television, a dinner, or even a morning cup of coffee also have a financial impact that — when aggregated with similar economic decisions — affect the price of that particular product or service and have a substantial effect on interstate commerce.”

Recognizing the vulnerability of relying on the Commerce Clause alone, the Obama administration in the Florida case shifted its emphasis to the Necessary and Proper Clause of the Constitution. That clause empowers Congress to enact “all Laws which shall be necessary and proper for carrying into Execution” its enumerated powers. As the Supreme Court has repeatedly explained, the Necessary and Proper Clause does not expand the scope of Congress’s enumerated powers. Instead, it gives Congress the ability to select among various means of exercising them — for example, the enumerated power to “establish post offices” necessarily and properly includes a power to print stamps.

The Obama administration claimed that the individual mandate is a necessary and proper means of carrying out its reforms in the health-insurance market. These reforms include requiring insurers to offer coverage to those with pre- existing conditions, to extend coverage to dependents up to age 26, and to eliminate lifetime coverage caps. Because these reforms make health insurance more expensive, the government’s lawyers claim that unless everyone is forced to buy health insurance, too many healthy people will sit on the market sidelines as “free riders” until they become ill. So in order to make the “reformed” health-insurance market work, it’s necessary and proper to force everyone to buy insurance.

Judge Vinson flatly rejected the administration’s attempt to escape the restrictions of the Commerce Clause by appealing to the Necessary and Proper Clause. His decision acknowledges that, while reforming an insurance market is a regulation of commerce, Congress cannot artificially create its own “free rider” crisis in the insurance market and then use that crisis to justify an otherwise unconstitutional mandate as “necessary and proper” to save the market from collapse.

This novel use of the Necessary and Proper Clause, if allowed to stand, would fundamentally transform our constitutional scheme from limited to unlimited federal power, narrowing the scope of individual liberty. In Judge Vinson’s words, “the more harm the statute does, the more power Congress could assume for itself under the Necessary and Proper Clause. This result would, of course, expand the Necessary and Proper Clause far beyond its original meaning, and allow Congress to exceed the powers specifically enumerated in Article I.”

One crucial difference between the Florida and Virginia decisions relates to the breadth of the remedy. While both courts agreed that the individual mandate was unconstitutional, the Virginia decision merely declared the mandate alone to be unconstitutional — the rest of ObamaCare was unaffected. But Judge Vinson concluded that the individual mandate could not be “severed” from the rest of the law, and so the entire law must be struck down.

The judge had little choice: The Obama administration itself argued that the individual mandate was inextricably intertwined with the rest of ObamaCare. So if the mandate fell, the whole scheme was doomed to collapse as a legal matter. “There are simply too many moving parts in the Act and too many provisions dependent (directly and indirectly) on the individual mandate and other health insurance provisions,” he held, “for me to try and dissect out the proper from the improper, and the able-to-stand-alone from the unable-to-stand-alone.”

The Obama administration attempted to cloak an unprecedented and unsupportable exercise of federal power in the guise of a run-of-the-mill Commerce Clause regulation. When the weakness of that theory was exposed, it retreated to the Necessary and Proper Clause and the taxing power. Judge Vinson’s decisive rejection of all these theories is another significant victory for individual liberty — the ultimate purpose of federalism — and it lays the intellectual groundwork for every decision on the mandate yet to come.

Randy E. Barnett is a professor of constitutional law at Georgetown University Law Center and a senior fellow at the Cato Institute. Elizabeth Price Foley is a professor of constitutional and health care law at Florida International University College of Law.