Individual Mandate now 2-1 in Courts

The blogs are alive with the news that Henry Hudson, federal judge in Virginia, has issued an opinion finding the individual mandate of the PPACA unconstitutional. Opinion in Virginia v. Sebelius is here. but the key paragraph (per the Washpo) seems to be this:

"Neither the Supreme Court nor any federal circuit court of appeals has extended Commerce Clause powers to compel an individual to involuntarily enter the stream of commerce by purchasing a commodity in the private market," he wrote. "In doing so, enactment of the [individual mandate] exceeds the Commerce Clause powers vested in Congress under Article I.

This is the first ruling against the health insurance reform law which passed Congress in early 2010. A federal trial judge in Michigan had previously ruled that the individual mandate is authorized by the commerce clause in Article I §8 of the Constitution. Another federal judge, this time in the Western District of Virginia, has upheld the constitutionality of the Minimum Essential Coverage Provision, aka individual mandate. That case, Liberty University v. Geithner and Virginia v. Sebelius must be reconciled by the Fourth Circuit.

On Health Insurance and Fire Departments

This last week, the blogs were alive with the sound of a house burning down. The fire department allowed the fire to reduce the Cranick family home in Obion County to embers because the owners had failed to pay the $75 fire service subscription fee to the nearby town of South Fulton. Firefighters did not respond to the scene when the fire was first reported because the family had not paid for the fire prevention service. When a neighbor who had paid his firefighting fee called, the firefighters loaded up their trucks and drove out to the site to prevent the fire from spreading to the neighbor's property.

I would assume that the family also did not have fire insurance on their house. And even if they had, it would likely be void. Failing to take the needful steps to protect your house from fire is certainly negligent. The refusal to pay a fire subscription fee is tantamount to failing to and I suspect that homeowners' insurance would not cover such willful negligence.

Fire insurance pays to replace possessions and real estate that was damaged by fire. However, health insurance does not compensate the patient for the damage that a disease causes her. Health insurance is used to pay for the procedures which prevent the disease from wreaking havoc on the body. It is in a way a medical tool which determines the outcome of a health problem. Similarly, paying for fire service subscription determines the outcome of a fire threatening your house.

An NPR reporter collected opinions from residents of South Fulton, two of whom replied that it would be wrong to let a house burn to the ground, regardless of whether the owner has paid for fire prevention service.

So how do you solve the moral conundrum of having to decide whether to put out the fire or sacrifice the meaning of the fire subscription fee? Well, you could mandate fire coverage, like every city does. Fire is a dangerous phenomenon, and its effects are not limited to those who choose to accept its risk. Cities desperately need to prevent fires from spreading building-to-building, so they do not allow a fire to get out of hand. City dwellers are mandated to pay for fire service. Municipalities tax their residents to ensure the public safety.

When a disease becomes an epidemic, the common saying is that it is "spreading like wildfire". Public health has the same goals as fire prevention: to provide security to citizens. To further this goal, it is sometimes necessary to restrict the set of decisions that a person can make. A person with a highly infectious disease cannot be allowed to promenade through a city. She must be treated. There are times when living in a society requires significant sacrifices of "individual liberty". Health is one of these areas, as is fire.

PPACA: No Way Around Commerce Clause Precedent

Late today, a federal judge in Michigan's Eastern District ruled that the individual mandate is constitutional, and is authorized by the commerce clause. In Thomas Moore Law Center et al. v. Obama (pdf), the plaintiffs seek a preliminary injunction against the enactment of the individual mandate. This is a slightly different issue from the States' claims in FL v. DHHS, but the commerce clause logic should work the same. As a spokesperson for the Department of Justice points out, this is the first time in which the merits of challenges to the Patient Protection and Affordable Care Act have been grounds for a decision.

Plaintiffs, two individuals and a public interest group, have standing. The issue is ripe for judicial decision. The remedy is allowed for under the Anti-Injunction Act. Let's play ball!

Plaintiffs argued that Congress has never had the power to regulate commercial inactivity, whereas the individual mandate seeks to penalize individuals who do not purchase health insurance. The district court finds that the authority of Congress to mandate individual coverage is found in the doctrine stated in US v. Lopez, 514 U.S. 549 558-559 (1995): "Those activities that substantially affect interstate commerce." The court dutifully follows instructions from Gonzales v. Raich 545, U.S. 1, 22 (2005) that it merely should look to whether there is a reasonable basis for the belief that such a relationship between the activity and interstate commerce exists.

The Commerce Clause, Taxing, and the General Welfare

I have in my hot little hands a debate published in the Pennsylvania University Law Review about the Individual Mandate.  No less, the side that argues that te individual mandate is an unlawful power grab is written by the very same David Rivkin and Lee Casey who are arguing the plaintiff's case in Florida et al v. US DHHS: A Healthy Debate. The debate took place before final passage of the PPACA, so there is some uncertainty in the exact language at play.

Rivkin and Casey start out where I would in the Commerce Clause debate, noting that the Supreme Court has held that Congress has the power to pass laws to regulate "activities, [which] taken in the aggregate, substantially affect interstate commerce." Gonzales v. Raich, 545 U.S. 1,22 (2005). This standard was first applied in defense of a law which prevented a farmer from growing, but not selling wheat in Wickard v. Filburn, 317 U.S. 111 (1942).  Because the hoarding of wheat would drive prices down if every farmer did it, Congress could regulate the practice.