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Category: Health care reform

Fuzzy math on the ObamaCare uninsured rate

Originally published on August 16, 2015

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Republican talking points on the plummeting rate of those Americans lacking insurance are off, by a large factor. Since the passage of ObamaCare, Republicans have claimed everything from it having no or little impact on the rate of the uninsured — to the heath care law actually increasing those without insurance. Earlier this week on Wednesday the Centers for Disease Control and Prevention (“CDC”) released its annual National Health Interview Survey, with key findings including:

  • The overall uninsured rate has dropped into the single digits – to 9.2% – for the first time, ever;
  • Since the implementation of the Affordable Care Act in 2013, over 16 million Americans have gained health insurance; and
  • The decrease in the uninsured rate is greatest in those states that expanded Medicaid coverage (down 8%) compared with those that did not (down only 6%)

Republicans, however, seem not to have gotten the memo. When former Republican Senator Judd Gregg appeared on Chris Hayes’ show, All In, in June, he and the host had a not-so-civil disagreement on the amount by which those lacking insurance had decreased. Hayes took exception to Senator Gregg’s assertion that under ObamaCare, “uninsured folks didn`t get picked up in any significant numbers.”

Hayes pressed the senator on polling data (from Gallup, not Pew as Hayes initially recalled) showing that the uninsured rate for those ages 18 and older had dropped by over 6% (from 18% in the third quarter of 2013 just before the ACA’s individual mandate and Medicaid expansion kicked in – to 11.9% in the first quarter of 2015). (For those of all ages, the drop in uninsured was 5.2% according to the CDC.)

Undeterred, Gregg gave a seemingly authoritative statistic, asserting without attribution that the total number of uninsured had only decreased by 4 million total individuals (from 44 to 40 million). Gregg blithely stated that his numbers were roughly in line with the percentage drop cited by Hayes in the polling. He snidely told Hayes,

“I wish you would get your numbers right. Your numbers [and your ability to understand them] are worse than Obama`s.”

Snap!

The problem, of course, for Gregg’s math is that he was calculating a percentage drop only among those who were originally uninsured – whereas the Gallup (and also CDC) percentages were based upon the population as a whole. So in real numbers, with a population of between 315 and 320 million between 2013 and 2015, the uninsured of all ages dropped from more than 45 million in 2013 to under 30 million in the first quarter of 2015 – that is to say, more than 5% of the population as a whole or 16 million people.

Senator Gregg is not alone among Republicans arguing that the ACA has netted few newly insured individuals. A current Republican House member recently gave a press interview, saying, “I’m not sure that’s true that more people are covered [under ObamaCare].”

Naturally, the Senator from the Tea Party, Republican Presidential candidate Ted Cruz, went furthest, fatuously claiming that the Affordable Care Act “has caused millions of people to lose their insurance.” Curiously, one day following Cruz’s slander against the ACA, he personally signed up his family for coverage under it. We call that chutzpah!

But what really takes chutzpah is for Senator Gregg to claim that only 4 million individuals newly gained insurance under the ACA – when the real number is 16 million, meaning he was off by 400%.

British Prime Minister Benjamin Disraeli is said to have famously remarked, “There are three kinds of lies: lies, damned lies, and statistics.” Senator Gregg’s “statistics” would, at best, appear to be fuzzy math, and, at worst, to qualify for one of Disraeli’s other categories.

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To the chagrin of conservatives, ObamaCare ruling is a model of restraint

Originally published June 26, 2015

46f753911dba79449670532283a05d90The federal judiciary is supposed to be the “least dangerous” branch of government owing to its limited powers. It has no standing army or purse strings. Its powers emanate from its great interpretive ability to “say what the law is.”

The Warren Court gained a reputation as being “activist” because, according to critics, it went beyond interpreting the law to creating it out of whole cloth – thus usurping the legislative function.

Judicial restraint can fairly be said to include the Court’s adherence to the Constitution in interpreting rights, deference to Congress in reviewing legislation and respect for the Court’s own prior rulings making precedent.

Chief Justice John Robert’s majority opinion upholding ObamaCare subsidies in King v. Burwell complies with all three of these tenets of judicial restraint – though you wouldn’t know it from his detractors on the right. Roberts read the statute as a whole and interpreted it according to what it was designed by Congress to do: “improve health insurance markets, not to destroy them.” Sounds like what a judicial umpire would, and should, do.

For his efforts, Roberts earned the scorn of Republicans. Presidential candidate Mike Huckabee echoed timeworn conservative complaints, bemoaning “unelected” judges “circumvent[ing] Congress” and “legislat[ing] from the bench.” “[J]udicial tyranny,” he declared on twitter!

No one let Huckabee know that the old clichés of the right during the Warren Era don’t really fit the new conservative jurisprudence.

In his column with the only mildly hyperbolic title, “John Roberts helps overthrow the Constitution,” George F. Will is at least honest about the new conservative complaint against John Roberts. He’s too judicially modest!

George Will bemoans the Court’s “vast deference to the purposes of the political branches.”

“Thursday’s decision demonstrates how easily, indeed inevitably, judicial deference becomes judicial dereliction, with anticonstitutional consequences. . . . The Roberts Doctrine facilitates what has been for a century progressivism’s central objective, the overthrow of the Constitution’s architecture. The separation of powers impedes progressivism by preventing government from wielding uninhibited power.”

When did it become the Supreme Court’s function to stop the government from effectively governing for its own sake?

George Will can’t decide if he’s more upset that Roberts has deferred to the executive or to the legislative branch in cleaning up the inartfully drafted portions of the Affordable Care Act so that they function as designed. He forgets that King v. Burwell presented a simple question of statutory interpretation, not of constitutional powers (that was already decided in favor of the ACA last term).

The right’s real objection is that Roberts is not a conservative activist – in the model of say, Antonin Scalia. Republicans wanted the Supreme Court to do judicially what they failed to do politically — repeal ObamaCare. That is not the job of a modest judiciary in line with its constitutional dictates.

Scalia’s new rule of interpretation for ObamaCare: “statutes that make no sense”

Originally published March 29, 2015

41705253a4c94fd4f433fba4149b517bThe Supreme Court has long used established canons of interpretation for federal statutes that yes, focus first on the plain meaning of the words that Congress used to express itself in drafting the text of law. But second, do not read words in isolation and instead, attempt to do justice to the legislative intent of the statute as a whole. Indeed, Justice Scalia has previously been a champion of what he called the “holistic endeavor” of statutory interpretation.

But that was until his considerable skills as the chief advocate for conservative results were called upon, again, to judge the legality of the Affordable Care Act.

Now Scalia has jettisoned his previously expressed position on statutory interpretation to do the right’s bidding in striking subsidies available to millions of lower income earners who wish to purchase health insurance under ObamaCare. In oral argument this month in King v. Burwell, Scalia actually suggested that in interpreting federal law, the High Court should keep in mind that Congress may well have intended laws that are both ill-conceived and make no sense – and that the Court should not be concerned if its interpretation might lead to an absurd result.

At issue in the case is one phrase in the 1,000-plus page law that allows healthcare subsidies for those that enrolled in ObamaCare through an “Exchange established by the State.” Since many red states refused to create their own “exchanges,” the argument goes, those who purchased insurance through a replacement federal exchange do not qualify for a subsidy.

Leave aside that no one who actually participated in the drafting of the law says that Congress intended such a narrow reading and that the lack of subsidies would send the federal exchanges into death spirals, undermining its carefully crafted architecture.

Legal scholars have explained that if the definition of “Exchange” as used in the statute is read in context, it includes those that the Department of Health and Human Services, now headed by Secretary Sylvia Burwell, established on behalf of states that chose not to do so for themselves.

First, Congress defined the term “exchange” with a capital “E,” three times, as an “Exchange” “established by the State,” [including in the sub-section of the statute under scrutiny]. . . . . That is what the term “means” each of the 280 times it appears in the statute.

Second, [another section of the Act] directs that if the State elects not to establish an “Exchange,” the Secretary of HHS shall “establish and operate such Exchange,” with a capital “E.” . . . . There is only one conceivable way the Secretary, a federal official, can establish an “Exchange” that has been defined. . . as an entity established by the state: She must act on behalf of the state.

To read the statute any other way would require the Secretary to do something that is, by definition, impossible. In contrast, there is nothing extraordinary about the Secretary acting for, or stepping into the shoes of, or standing in for, the state. This type of legal substitution happens frequently, with the federal government and others acting, for example, as proxies, trustees, lawyers, conservators, guardians, representatives, and agents. If an agent of the state, for example, performs an authorized act on the state’s behalf, it is an act by the state. Here, the authority comes from the state’s election to have the Secretary establish the exchange.

A little perspective goes a long way – both in terms of a reasonable textual reading of the phrase in question in the context of the statute as a whole and the law’s overall intent, which was to provide greater access to health care insurance, whether or not one happens to live in a state that established its own exchange or one in which the federal government stepped in to do so. The ACA is often said to be a three-legged stool, which only works if (1) insurance companies forgo pricing pre-existing conditions into their rates, in consideration for (2) the government imposing a mandate on all individuals to purchase insurance to broaden the risk pool, in consideration for (3) those individuals who would not otherwise being able to afford that insurance receiving subsidies to assist in paying for premiums. Remove any one leg, and the stool collapses.

In light of this perspective, the normal rules of statutory interpretation would reject this latest textual challenge to ObamaCare.

Rules of federal statutory construction include:

  • Follow the plain meaning of the statutory text, except when text suggests an absurd result or a scrivener’s error.
  • Each statutory provision should be read by reference to the whole act.
  • And avoid interpreting a provision in a way that would render other provisions of the act superfluous or unnecessary – or is inconsistent with the general policy, a necessary assumption of another provision or the structure of the statute.

In fact, Justice Scalia is on the record in a 1988 case saying,

“Statutory construction . . . is a holistic endeavor. A provision that may seem ambiguous in isolation is often clarified by the remainder of the statutory scheme — because the same terminology is used elsewhere in a context that makes its meaning clear, or because only one of the permissible meanings produces a substantive effect that is compatible with the rest of the law.”

But that was then. This is now.

At oral argument in Burwell, Scalia proposed a new rule of statutory interpretation.

When faced with the logical implication of the three-legged stool that the phrase providing subsidies to Exchanges was not written or intended to exclude those created by HHS, Scalia asked the Solicitor General the following question:

“I mean it may not be the statute they intended. The question is whether it’s the statute that they wrote. . . . [T]here are no provisions in the statute that turn out to be. . . ill­-considered and ill-­conceived?”

Then in Scalia-like fashion, he clarified exactly what he meant, in asking,

“There are no statutes that make no sense?”

The pretense for Scalia not getting beyond the plain meaning of an “Exchange established by the state” is that it is unambiguous and can only be read in one reasonable way. But this is inconsistent with another of Scalia’s offhanded comments at oral argument that “[t]his is not the most elegantly drafted statute,” which, if true, would appear to qualify the phrase in dispute, at worst, as a scrivener’s error capable of reformation to be read correctly. And most significantly, this pretense can only be true if one puts on blinders and ignores the rest of law and its legislative history.

In other words, Justice Scalia is advocating a narrow reading of the ACA without reference to the whole act that renders its general policy null and void – completely at odds with the original intent of its framers, all of whom are still around and have said so. Instead of a “holistic” approach, Scalia has adopted a new rule of interpretation — the heretofore unknown “Presumption of Irrationality” — to poke holes in ObamaCare so that it cannot survive as a statutory whole. When did we start presuming that legislators do not know how to craft legislation to enact their programs? The problem is not that the ACA makes “no sense.” It is that Scalia’s new rule is nonsense.

Conservative judges forget about original intent in striking ObamaCare subsidies

Originally published July 24, 2014

Court of Appeals for the District of Columbia Circuit ruled earlier this week that an incomplete description of the insurance marketplace in one section of the Affordable Care Act should be strictly construed to deprive millions from receiving needed subsidies and doom the law to failure. Despite the absence of any evidence that the lawmakers who passed the law intended this outcome, and contrary to the IRS’ implementation of the statute, two conservative judges on the appellate court used what has been described as a “typo” to justify their statutory (mis)interpretation.

What ever happened to Justice Scalia’s rule of original meaning?

2d33a7880bda45aabe1ee88793d6932bIn a widely quoted lecture that Justice Scalia gave in 2005, he explained that he was an “originalist.” His manner of interpreting the Constitution or a federal statute is to “begin with the text” and then “to give that text the meaning that it bore when it was adopted by the people.” He rejected strict constructionism, colorfully explaining,

“I do not think the Constitution, or any text should be interpreted either strictly or sloppily; it should be interpreted reasonably.”

Justice Scalia meet Circuit Judge Thomas B. Griffith , who wrote the majority opinion in Halbig v. Burwell.

Judge Griffith focused on one phrase in the nearly one thousand-page statute that allowed the government to provide tax subsidies to those who purchased their insurance through an exchange “established by the State.” No mention in that sub-section of the federal exchanges set up by Department of Health and Human Services, which steps in when a particular state chooses not to organize its own exchange. So Judge Griffith re-wrote the statute to say that tax subsidies were “only” available for the state exchanges, not the federal exchanges.

Never mind that the federal exchanges are referenced on equal footing with the state exchanges in numerous other sections in the text of the law; never mind that every state must either have a state or HSS exchange; and never mind that the entire statutory scheme of mandates and group ratings necessitates subsidies for all marketplaces so that people can afford the insurance they are required to carry, whether they buy it on a state or federal exchange, and that the IRS’ implementation of the law was reasonable and consistent with the intent of Congress when it passed the ACA.

And we don’t have to guess about the original intent of the framers of the Affordable Care Act. They are all still around, and none say there was a hidden intent to bury a poison pill deep within the text of the bill to forbid insurance subsidies for the federal exchanges. Indeed, when the Congressional Budget Office scored the ACA before its passage, federal exchange subsidies were included as costs, and no one gave it a second thought.

As it turns out, this outrageous example of conservative judicial activism will likely not stand for long. The three-judge panel that issued the ruling in Halbig consisted of two conservative Republican and one Democratic appointees. The circuit court will likely grant en banc review. And in light of Harry Reid’s breaking of the filibuster for judicial appointments late last year, President Obama was able to fill longstanding vacancies on that court, so that Democratic appointees are now in the majority, 7-4.

And the same day as the D.C. Circuit announced its ruling, the Fourth Circuit Court of Appeals in Richmond, Virginia ruled exactly the opposite on the very same issue.

But really, it shouldn’t require a judge appointed by a Democrat to reasonably interpret a statute. Even Justice Scalia could do that, at least one hopes he could, as an “originalist” who abhors sloppy legal work.

Republican governors are rethinking Medicaid expansion under ObamaCare

Originally published February 28, 2013

New Jersey Governor Chris Christie Gives Annual State Of The State AddressJust today Governor Chris Christie announced that New Jersey would accept expanded Medicaid coverage provided by the Affordable Care Act. Christie joins a growing list of Republican governors who have similarly signed on to this important component of ObamaCare. The divide between Republican governors accepting and those rejecting Medicaid expansion seems to be breaking down by politics and demographics.

Of the approximately 30 million individuals that the ACA was designed to insure, about half are mandated to purchase coverage in the newly created exchanges, with financial assistance when needed, and the other half, who are more economically disadvantaged and fall within 133% of the poverty rate, are slated to get coverage through the expansion of Medicaid that the states administer. When the Supreme Court upheld the constitutionality of the Affordable Care Act last June, its ruling embedded what some saw as a poison pill on Medicaid expansion.

Seven of the nine justices found law’s offer of new Medicaid dollars to the states unconstitutional because it was an all-or-nothing deal. If a state chose not accept the expansion, then it lost all of its preexisting Medicaid funding. Or in Chief Justice John G. Roberts, Jr.’s words, Medicaid expansion is a “gun to the head” because the “threatened loss of over 10 percent of a State’s overall budget… is economic dragooning that leaves the States with no real option but to acquiesce.” The remedy, approved by a slightly different 5 member majority, was to let each state choose for itself whether to accept Medicaid expansion.

In the immediate aftermath of the Supreme Court ruling, Democrats were bullish on the states choosing to participate.

Jack Lew, the President’s then Chief of Staff, now Treasury Secretary, expected the “vast majority of states” to accept Medicaid expansion. He explained the legal and economic justification for doing so:

“To be clear, the expansion of Medicaid coverage for those who can’t afford it was upheld. . . . And states are now in a position where the federal government is saying we will pay 100 percent of the cost of covering those people.”

Nancy Pelosi, the top Democrat in the House, concurred, saying, “I don’t think governors will turn that down. People have the need, the urgency is there. . . . Once this bill is rolling and people experience benefits of it, it’s very hard for a state to say [no].”

But “no” the states led by Republicans began to say.

Starting in early July, from Bobby Jindal of Louisiana to Nikki Haley of South Carolina to Rick Perry of Texas, Republican governors started rejecting Medicaid expansion. Governor Perry put it with his characteristic bluntness: “If anyone was in doubt, we in Texas have no intention to… expand Medicaid under ObamaCare.”

Something interesting unfolded, however, after the November elections when even House Speaker John Boehner had to concede that the Affordable Care Act is the “law of the land” and would not be repealed. Several Republican governors announced that their states would, in fact, accept Medicaid expansion. Some are hard right conservatives, including Jan Brewer of Arizona, and just last week, Rick Scott of Florida, who was such a nemesis to ObamaCare that his state was the lead plaintiff that sued to overturn it in the courts and vowed never to implement it.

So what’s going on?

First, it’s economics. It is financial malpractice for a governor to reject federal funding that the taxpayers of his or her state have already paid for – which malfeasance is compounded by the suffering that would be inflicted on the poorest among us that the program was designed to aid. In Florida, for example, without Medicaid expansion, some 1.3 million people would go uninsured and the state would lose $26 billion in aid over the next 10 years. Even more, state-run hospitals were facing the literal prospect of bankruptcy because they are counting on the extra Medicaid funding to make up for the loss a federal indigent care reimbursement program that they traded for the ACA. Similarly, in New Jersey, Medicaid expansion will cover 300,000 new low income earners and bring an infusion of $1.7 billion to the state next year.

Indeed, the federal government will cover all of the expansion for the first three years, after which federal coverage will still remain at 90%. A pretty good deal.

But, second there’s always the politics. To date, 28 states and the District of Columbia are participating or leaning in favor, including now 8 states led by a Republican. Another 16 states have rejected the program or are leaning against it – all with Republican governors.

There is an obvious divide between the dueling Republican governors. Those opting out are thought to have national ambitions to seek the Republican nomination for president in 2016, including the aforementioned Jindal, Haley and Perry, along with Scott Walker of Wisconsin. By contrast, those opting-in face reelection in their home states next year, including Scott in Florida and John Kasich in Ohio. Or they hail from states with large minority, especially Latino, populations that would not look kindly on their governor forgoing this program, which may explain Arizona’s Brewer as well as New Mexico’s Susana Martinez and Nevada’s Brian Sandoval.

We saw a similar divide among House Republicans on their New Year’s Day vote to avoid the Fiscal Cliff. Boehner let the bill come to vote, and it was passed by a combination of moderate Republicans and Democrats — with the acquiescence of practical Republicans. But all of the up-and-coming crop of Republicans, including Jeff Flake, Tim Scott, Mike Pence and Shelley Moore Capito, followed Eric Cantor in voting against the compromise.

And how to explain Chris Christie, who is also thought to hold 2016 presidential dreams? He’s up for reelection in New Jersey this year and demonstrated during Hurricane Sandy that he knows how to bring home the bacon. It boils down practical local versus ideological national politics for Republican governors deciding to accept Medicaid expansion.

Chris Christie – New Jersey

New Jersey Governor Chris Christie Gives Annual State Of The State AddressAccording to the Advisory Board Company, which is keeping track of each state’s decision on Medicaid expansion, Chris Christie became the latest Republican governor to in his Feb. 26 budget address to announce that New Jersey will participate. The ACA provision is expected to extended Medicaid coverage to about 300,000 uninsured New Jersey residents

Jan Brewer – Arizona

Supreme Court Hears Oral Arguments On Arizona Immigration LawGov. Jan Brewer (R) in her 2013 State of the State speech, delivered on Jan. 14, announced that Arizona will participate in the Medicaid expansion, which would extend health care services to an estimated 300,000 more state residents. Brewer noted that the expansion plan will “include a circuit-breaker that automatically” would reduce enrollment if federal reimbursement rates decrease.

Rick Scott – Florida

Florida Gov. Scott Visits Opening Of Advanced Pharma FacilityGov. Rick Scott (R) on Feb. 20 announced that the state will participate in the ACA’s Medicaid expansion, citing HHS’s conditional support for a waiver to shift most of the state’s Medicaid beneficiaries into a managed-care program. However, Scott said that Florida would only participate in the expansion for three years before reevaluating the decision. Supporters of the ACA heralded Florida’s shift as a major reversal; Scott mounted his successful campaign for governor in 2010, in part, by being one of the nation’s foremost critics of President Obama’s planned health reforms.

Rick Snyder – Michigan

Governor Snyder Holds Roundtable On Detroit's Financial CrisisGov. Rick Snyder (R), in a statement released on Feb. 6, announced that his fiscal year 2014 budget proposal includes a plan to expand the state’s Medicaid program under the Affordable Care Act. The plan would extend Medicaid benefits to about 320,000 eligible residents. Snyder said the plan contains safeguards that will ensure the financial stability of the program and protect against changes in the government’s financial commitment to the expansion.

Brian Sandoval – Nevada

National Clean Energy Summit 4.0 Takes Place In Las VegasGov. Brian Sandoval (R) on Dec. 11 announced that the state will participate in the Medicaid expansion. “Though I have never liked the Affordable Care Act because of the individual mandate it places on citizens, the increased burden on businesses and concerns about access to health care, the law has been upheld by the Supreme Court,” Sandoval said in a statement, adding, “As such, I am forced to accept it as today’s reality and I have decided to expand Nevada’s Medicaid coverage.”

Susan Martinez – New Mexico

c3edf3f076705bfdcfe4c3d8fae824ecGov. Susana Martinez (R) on Jan. 9 announced that her state will participate in the Medicaid expansion, which potentially could extend health coverage to nearly 170,000 additional low-income uninsured residents. Martinez noted that contingency measures will be established if federal funding for the expansion diminishes, which would mean scaling back the expansion by dropping newly covered beneficiaries from the Medicaid rolls.

Jack Dalrymple – North Dakota

e7017f22aad6d275c7e075cf640e3c9cGov. Jack Dalrymple (R) in January said the politics associated with the ACA should not prevent North Dakota from participating in the Medicaid expansion. He is supporting a bill that would allow the state health department to access federal funds allocated through the ACA. Dalrymple also said he will include the expansion in his budget proposal and that members of his staff will testify in favor of the expansion before state lawmakers.

John Kasich – Ohio

Bipartisan Governors Delegation Meets With Obama At White HouseGov. John Kasich (R) on Feb. 4 announced that the state will be participating in the Medicaid expansion, the Cleveland Plain Dealer reports. He made the announcement in his two-year budget announcement, but warned that Ohio would “reverse this decision” if the federal government does not provide the funds it has pledged to the expansion.

Return of the Umpire: Now it’s the “Roberts Court”

Originally published June 28, 2012

bb303c7bddabef2eb642a430d97515ffJust last week in the run-up to the Supreme Court’s ruling today upholding the Affordable Care Act, Professor Erwin Chemerinsky joked that we’ve been living under the “Kennedy Court.” It’s been Associate Justice Anthony Kennedy who has voted with the majority in split decisions – 94% in the majority during the last two Supreme Court sessions. Kennedy has been the key swing vote on key issues of campaign finance law, gay rights and affirmative action, among others. And, indeed, the conventional wisdom, even my own, was that Kennedy’s single vote, along with either the four liberal or the four other conservative justices, would decide the fate of President Obama’s health care reform.
But Kennedy was not the swing vote on the Affordable Care Act. Instead, it was Chief Justice John G. Roberts, Jr.

The umpire returns

At his confirmation hearing, Roberts famously testified to the Senate Judicial Committee that it was the job of a judge to be an umpire – calling balls and strikes – not to act like a legislator crafting policy. And his opinion today, the now Chief Justice reaffirmed the Court’s longstanding deference to Congress in enacting laws.

“Proper respect for a co-ordinate branch of the government” requires that we strike down an Act of Congress only if “the lack of constitutional authority to pass [the] act in question is clearly demonstrated.” [Citation.] Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.

And Roberts made clear that he was ruling on the Act based upon whether it was constitutional, not upon whether he deemed it wise.

In resuming his role as Umpire in Chief, Justice Roberts has rebranded the Court as his own. Had he sided with the conservatives, including Justice Kennedy, and struck down President Obama’s signature act of his first term, the focus would have been on why Kennedy chose to swing right (which is still an interesting question). And such a ruling would have politicized the Court to heights that surpassed reaction to Bush v. Gore and Citizens United.

Indeed, by voting to uphold the Act here, Roberts gave himself some breathing space in terms of the legitimacy of the Court and snuck in some rather conservative principles of New Federalism – including a retrenchment of Congress’ powers under the Commerce Clause and a new restriction on federal strings attached to block grants to the states that was part of the ruling on Medicaid expansion. But Roberts also reasserted himself as the leader of the Court, both as the key swing vote in this seminal case and the one to pen its majority decision. One has to admire his “political” instincts in that regard.

Oral argument provided hints of today’s ruling

At oral argument before the High Court in March, there was a key exchange between Justice Sotomayor and Paul Clement, representing the states challenging the Act, in which she asked:

Could we have an exemption? Could the government say everybody pays a shared health care responsibility payment to offset all the money that we’re forced to spend on health care, we the government; but anybody who has an insurance policy is exempt from that tax? Could the government do that? . . . . We get tax credits for having solar-powered homes. We get tax credits for using fuel-efficient cars. Why couldn’t we get a tax credit for having health insurance and saving the government from caring for us?

In response, Clement conceded that “[t]he government might be able to do that” and the Chief Justice later encouraged Clement to return to Justice Sotomayor’s question. Turns out that was game, set, match because Roberts could not see any functional difference between such a credit and a tax.

In his majority opinion, Justice Roberts noted that labels are not important but that “[t]he exaction the Affordable Care Act imposes on those without health insurance looks like a tax in many respects.” He cited the fact that what is referred to in the Act as a “shared responsibility payment” is made to the Treasury by taxpayers when they file their tax returns, calculated based upon taxable income, found the Internal Revenue Code and collected by the IRS. And it produces revenue for the government, an estimated $4 billion per year by those who choose to go without health insurance.

Harkening back to Justice Sotomayor in oral argument, the Chief Justice analogized to a hypothetical tax on homeowners without energy efficient windows. And he noted that “Congress’s use of the Taxing Clause to encourage buying something is. . . not new.” Indeed, the Chief quoted Benjamin Franklin that nothing is certain “except death and taxes.” According to Roberts, the Act “makes going without insurance just another thing the government taxes, like buying gasoline or earning income.”

And contrary to Roberts’ Commerce Clause analysis, “the Constitution does not guarantee that individuals may avoid taxation through inactivity.” This was a cagey way for Roberts to distinguish the Commerce from the Taxing Clause authority for the Act and was apparently enough to carry the day for the constitutionality of the Affordable Care Act. Roberts did not want his Court to be the first since 1936 to overturn a major piece of social legislation. His patina of an umpire would have been lost forever.

healthcare_law_image1Chief Justice Roberts’ majority opinion today in National Federation of Independent Business v. Sebelius has now become his signature ruling – and by extension, the Supreme Court has now become the “Roberts Court.”

Chemerinsky’s predictions on the Supreme Court’s upcoming ruling on Obamacare

Originally published June 20, 2012

healthcare_law_image1Professor Erwin Chemerinsky, Dean of the U.C. Irvine School of Law, gave our firm a lunchtime presentation today on the Supreme Court’s docket. The topic on everyone’s mind, of course, was the Court’s upcoming ruling on the Affordable Care Act, which is expected any time.

Dean Chemerinsky wouldn’t venture a guess on the central issue in the case – whether the Court will uphold or strike down the Individual Mandate – but made some interesting observations and predictions.

His biggest prediction was that the case would either be 6-3 upholding the Act (including Justices Roberts and Kennedy in the majority along with the liberal justices) – or 5-4 striking it down (with Justice Kennedy as the swing vote along with the conservatives).

Dean Chemerinsky, only somewhat tongue-in-cheek, called it is a misnomer to refer to the presently constituted Supreme Court as the “Roberts Court.” Rather, it’s the Kennedy Court. Since John G. Roberts, Jr. became the Chief Justice, Justice Kennedy has voted with the majority well over 90% of the time. And when broken down upon ideological lines in split-decision cases over the last couple years, 75% of the time Kennedy sides with the conservatives, and only 25% with the liberals. So these statistics might make a supporter of the Affordable Care Act wary.

But the Dean pointed out that for all of the commentary on statements made at oral argument before the Supreme Court on this case, Justices Kennedy and Roberts were equally critical of the attorney representing the federal government supporting the constitutionality of the Act as they were of the attorney for the states opposing it. And if the High Court were to find the Act to be in excess of Congress’ powers under the Commerce Clause, it would be the first time since 1936 that the Court declared a federal social services program to be unconstitutional – in other words, unprecedented in the post-New Deal age.

The Dean imagined that if the Court decided to strike down the Act, it might do so narrowly, such as by chastising Congress for forcing people to engage in commerce. He stated, however, that health care is unique because the people who don’t purchase medical insurance negatively affect those who do in terms of higher premiums and availability. It’s not like broccoli, which is not indispensable and no one will provide for free if you don’t buy it yourself.

But maybe the Court won’t even reach the big Commerce Clause question. The Dean noted that the Individual Mandate acts like a tax in that its penalties for those who refuse to buy insurance are imposed based upon a percentage of income and collected by the IRS. And if a tax, then it is undisputed that Congress has the power to tax and spend for the general welfare under Article I, Section 8 of the Constitution. He was taken by an exchange between Justice Sotomayor and Paul Clement, representing the states, in which she asked whether Congress could not just impose a tax on everyone for healthcare and grant an exemption for those who procured private insurance – to which Justice Kennedy heartily inquired why the Individual Mandate was any different. Mr. Clement had no adequate response to Justice Kennedy’s question, other than to point out that the Obama Administration denied that the Act imposed a tax in its political salesmanship.

Dean Chemerinsky did predict that the Supreme Court would not find the Act to be in violation of the Anti-Injunction statute, which is an equitable remedy that may be overcome by the importance of a decision on the merits. He also predicted that if struck down, parts of the 2,700 page Act would be found severable – especially those that had nothing to do with pre-existing conditions, caps or open availability of insurance that were the quid pro quo with the insurance industry to support, and be able to afford, the Individual Mandate.

In a truly disquieting discussion, the Dean opined that the last question to be decided by the Court – whether the burden on states with regard to Medicaid funding violates the Tenth Amendment – could have huge implications for all federal grants provided to the states (e.g., existing Medicaid, No Child Left Behind, etc.), again, depending on how broadly the Justices rule should they decide to find the act unconstitutional on this ground.

The Dean’s final prediction: that the ruling would be handed down not tomorrow, but next Thursday. I wish Dean Chemerinsky would come back to our firm next week to comment once the Court actually hands down its ruling.

Conservative judge stays his ruling on health care reform’s unconstitutionality

Originally posted March 4, 2011

healthcare_law_image1Federal District Judge Roger Vinson of Pensacola on Thursday stayed his own previous ruling striking down the Health Care “Affordable Care” Reform Act pending what he hopes to be a fast-tracked appeal. In doing so, he has become an advocate of what he characterizes as his strong belief in the unconstitutionality (and non-severability) of the individual mandate in the Act as beyond Congress’ powers under the Commerce Clause of the Constitution. He has enough awareness, however, of the 3 other district court judges who have upheld the constitutionality of the Act to realize that it will likely take the Supreme Court to make the final decision on the Act. He predicts a split-ruling by the Supreme Court but clearly thinks he’s going to win there (despite prior rulings by Justice Kennedy, and even Justice Scalia, that would indicate otherwise). So he is conditioning his stay on the Obama Administration making an expedited appeal, essentially mandating the timeframe for the appeal to proceed.

Judge Vinson has taken the opportunity of the government’s motion for clarification to both reiterate the basis for his original ruling and take notice of various political events that occurred after he issued it in late January 2011. He apparently reads his own press as he notes discussion of his so-called “broccoli mandate” analogy (i.e., that requiring citizens to purchase to health insurance is the equivalent of forcing them to eat broccoli as part of an anti-obesity campaign) in testimony before the Senate Judiciary Committee. Interestingly, he alludes to but then fails to answer a more recent ruling by Judge Gladys Kessler of the District of Columbia that health care is different than broccoli because medical care providers must give emergency care free-of-charge to the uninsured. The the individual mandate is aimed at preventing free-loaders who would otherwise make the cost-shifting choice to let others pay for their health care when they eventually need it – as we all will at some point in our lives. Judge Vinson takes a second bite at the broccoli but doesn’t chew.

The heart of Judge Vinson’s decision to stay his ruling rests upon his inability to predict ultimately how the various courts of appeal and Supreme Court will decide on the constitutionality of the Affordable Care Act.

I cannot say that the defendants do not have a likelihood of success on appeal. They do. And so do the plaintiffs. Although I strongly believe that expanding the commerce power to permit Congress to regulate and mandate mental decisions not to purchase health insurance (or any other product or service) would emasculate much of the rest of the Constitution and effectively remove all limitations on the power of the federal government, I recognize that others believe otherwise. The individual mandate has raised some novel issues regarding the Constitutional role of the federal government about which reasonable and intelligent people (and reasonable and intelligent jurists) can disagree. To be sure, members of Congress, law professors, and several federal district courts have already reached varying conclusions on whether the individual mandate is Constitutional. It is likely that the Courts of Appeal will also reach divergent results and that, as most courtwatchers predict, the Supreme Court may eventually be split on this issue as well. Despite what partisans for or against the individual mandate might suggest, this litigation presents a question with some strong and compelling arguments on both sides. Ultimately, I ruled the way I did, not only because I believe it was the right overall result, but because I believe that is the appropriate course for a lower court to take when presented with a (literally) unprecedented argument whose success depends on stretching existing Supreme Court precedent well beyond its current high water mark and further away from the “first principles” that underlie our entire federalist system.

Judge Vinson goes on to weigh the relative injuries to the parties – whether in allowing the some 450 preliminary steps for implementation of the Act to proceed or to stop them in their tracks – and finds, on balance, in favor of a stay. He notes there his ruling is only binding on the 26 states that are parties to his litigation. But one of the states is Michigan, where another District Court Judge has already ruled the Affordable Care Act to be constitutional – so it’s unclear which ruling governs. And there is dissention among the ranks of the plaintiffs in Judge Vinson’s case. Some have said publicly that they will immediately halt implementation of the Act in light of his ruling, but eight have suggested that, out of an abundance of caution, they will continue its implementation while the case winds through the appellate courts. There is even one intra-state conflict. While the Attorney General of the state of Washington (who is a party plaintiff) opposes a stay of the ruling, the Governor of Washington favors continued implementation of the Act. (Guess which one’s the Democrat and which one’s the Republican!)

Not content that his job was done, Judge Vinson concludes his stay ruling by demanding that the case be “immediately appealed and pursued in the most expeditious and accelerated manner allowable.”

Tongue planted firmly in his cheek, the Judge says,

[T]he legal issues specific to this case have already been fully and very competently briefed. With a few additional modifications and edits (to comply with the appellate rules), the parties could probably just change the caption of the case, add colored covers, and be done with their briefing.

Therefore, he grants the motion to stay, but conditions it on the government both filing a notice of appeal within 7 days and seeking expedited appellate review. It will be interesting to see how the government reacts and whether it seeks different immediate relief from the 11th Circuit Court of Appeals.

Judge Vinson says his concern is the intermediate effect of the Act which “seeks to comprehensively reform and regulate more than one-sixth of the national economy” (an observation strikingly at odds with his fundamental ruling that the Act has an insufficient nexus to interstate commerce). A cynic might say, especially in light of the seemingly political observations in his rulings, that the Judge’s real concern is the politics health care reform – as his fast-track schedule might put the issue before the Supreme Court for a decision during the 2012 presidential campaign. Judge Vinson is the judicial equivalent of Scott Walker – a committed ideological conservative, wanting to take us back to the days of social Darwinism before the New Deal and in a hurry to get there.