Health Care Reform in the Courts

I had intended to provide an omnibus discussion of Florida et al. v United States Department of Health and Human Services, the lawsuit on behalf of twenty states challenging the Patient Protection and Affordable Care Act being argued today in the United States District Court for the Northern District of Florida.

Reading through the plaintiff's complaint (pdf), authored by Florida AG Bill McCollum is proving an interesting exercise. Basically, there are three alleged issues:

1. The PPACA encroaches on individual liberty to choose to engage (or not to engage) in economic transactions with private corporations, exceeding Congressional Article I, sec. 8 authority.
2. The tax on individuals which enforces the mandate is an unlawful capitation under Article I, secs. 2 & 9.
3. Finally, the PPACA in its changes to Medicaid, represents an unlawful encroachment on State Sovereignty.

I will try, as the day goes on and I read more, to outline the debate surrounding this case as well as the analyze the arguments before the Court.  In a sense, I'm liveblogging my reading of the motions, case law, and relevant history.  Stay tuned to this space for an emerging story that I hope will be coherent as this case is important for the future of Commerce Clause authority. 

Issue #1- Congressional Authority

The Federal Government is defending the law principally by arguing that the mandate to buy health insurance on an open market in the PPACA is authorized by the Article I, sec. 8 Commerce Clause.  This clause has generally been held to be expansive and widely encompassing since the Supreme Court began affirming the New Deal expansion of federal powers.  Two recent cases, U.S. v Lopez, 514, U.S. 549 (1995), which overturned the federal Gun-Free School Zones Act of 1990, and U.S. v Morrison, 529 U.S. 598 (2000), are notable exceptions and are the only times in the last 65 years that the Supreme Court has struck down a law for going beyond the Congressional commerce power.

Issue #2- The Taxing Power and Prohibitions

Issue #2 is interesting, as nowhere in the text of the complaint appear the words "the 16 Amendment", which allows direct taxation of United States citizens. I'm not a tax scholar, but that seems like a glaring- and therefore purposeful- oversight by the plaintiffs. Their argument, as far as I can follow it, is that the article I sections 2 and 9 provisions against direct taxation still apply regardless of the 16th amendment insofar as they are a statement of principle that states are sovereign. Or they apply here without the amendment to the language of those sections because the tax encourages- in their words- "many persons to enroll in Medicaid at a substantial cost to the Plaintiffs." However, the complaint here uses exactly the language that is modified by the 16th Amendmnet. Plaintiffs allege that the PPACA tax is a "capitation and a direct tax that is not apportioned among the states according to census." It must be the opinion of the plaintiffs that the 16th Amendment doesn't alter the force of the original text, which is a weird theory in my opinion. I would love some commentary here, as the only Amendment and its effects on the original text I have studied extensively is the 14th.

Plaintiffs further assume that because the tax is a penalty upon citizens, it is not covered by the authority "to lay or collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration." Whereas I read the 16th Amendment as a total bill of freedom for any duly enacted tax on incomes, the plaintiffs believe that the tax in the PPACA infringes on the exclusive right of the state to tax citizens from sources other than incomes. Further analysis of the taxing argument, including responses to the lead plaintiffs' lawyers, is here: The Commerce Clause and The Power to Tax.

Issue #3- Federalism

The claims underlying Issue #3 are pretty much all the same: the PPACA changes the nature of Medicaid from a federal-state partnership into a federal takeover of state agencies.  The PPACA coerces states into spending more money on Medicaid than they currently have budgeted.  These claims are always yoked to the claim that the plaintiffs "have no choice other than to participate" in Medicaid. While this claim of 'no escape' goes unwarranted in the original complaint, I will do my best to find an explanation of it in the coming hours. It is the lynchpin of Issue #3: if the state can choose not to participate in Medicaid, then (and this assumption is clearly shared by the plaintiffs) there is no federal takeover and their States' sovereignty is as unfettered as the day it entered the Union.

In the meantime, here's my analysis of the Constitutional harm that would result from the feds dictating to states how to set up insurance exchanges and protect consumers: McCollum claims PPACA "Deprives [states] of their.... right to a republican form of government".