March 24, 2017

Legal Debate of the Individual Mandate

Since October 2010, two District Court rulings have declared Section 1501 of the recent health care law unconstitutional, while three rulings other rulings have declared the same provision constitutional. Section 1501 will require non-exempted individuals to purchase minimum coverage health insurance in 2014 or pay a fine, as stated in the 906-page law [.pdf]. Within the last two weeks, the Obama Administration has formally responded to both cases declaring Section 1501 unconstitutional and revealed its main arguments for the legality of the health care law.

Today the Department of Justice filed a brief in response to a Virginia District Court ruling that struck down Section 1501 last December. The DOJ’s 77-page brief [.pdf] argues for the dismissal of the Virginia ruling on the grounds that Virginia does not have standing to challenge the law and even if the state did have standing, the law is still within the scope of the Commerce Clause. The Obama Administration argues the Commerce Clause gives the federal government the authority to regulate interstate commerce and since health insurance is a nationwide service, the federal government can pass laws regarding health insurance, including the individual mandate.

The rationale within the Virginia ruling contrarily argues the Commerce Clause does not allow Congress to pass the individual mandate. The Virginian ruling argues Section 1501 is unconstitutional because the Commerce Clause allows Congress to regulate interstate commerce, not require participation in it. In other words, Congress can pass laws regarding interstate commerce, but Congress cannot pass laws requiring participation in interstate commerce.

Within the brief issued today, the Obama Administration rejected this rationale and replied Congress, under the authority of the Commerce Clause, can even regulate conduct associated with interstate commerce. The brief then cites support from Supreme Court precedents, particularly Gonzales v. Raich (2005), a ruling that held the Commerce Clause allows Congress to criminalize the growth and use of medicinal marijuana even in states where state laws permitted such use. As a result, there are precedents allowing Congress to regulate non-economic activities (conduct) that substantially impact economic activity.

This is an important response from the Obama Administration because it also addresses the core argument of a recent District Court Ruling in Florida that similarly ruled Section 1501 unconstitutional. This Florida ruling fundamentally argued the same point of the Virginia ruling that Congress cannot use the Commerce Clause to require the purchase of a good. Though, the Florida ruling took this unconstitutionality a step further and did not just strike down Section 1501, it instead struck down the entire health care law. Since Section 1501 is invalid and is the mechanism to pay for the new services within the health care law, Judge Vinson wrote, the entire law is therefore invalid.

On Thursday, February 17th, the Obama Administration responded to Vinson’s ruling with a “motion to clarify.” This motion [.pdf] respectfully asked Vinson to clarify his ruling because of the “substantial uncertainty” it may have on the already implemented benefits of the law, such as biases against those with pre-existing conditions. Further, Vinson’s ruling struck down the entire law, yet expressly denied a request for injunctive relief against the law, which the DOJ argues is an apparent dispute within Vinson’s rationale.

(Update 3/3: Vinson issued a response to the motion to clarify on March 3rd. The twenty-page response [.pdf] ordered the enforcement of the health care law while the law is in the appeals process and therefore denied injunction. Though, the stay was instituted with the requirement for the DOJ to appeal the ruling within seven days. The DOJ has said it will appeal to the 11th Circuit Appeals Court.

Vinson also responded to the argument in Gonzales v. Raich that Congress can regulate conduct that impacts interstate commerce. Vinson argued the conduct in Gonzales and other similar cases was “acting of their own volition,” not inactivity. As a result, Vinson said, other Commerce Clause precedents regarding conduct do not address the question of whether Congress can require the purchase of a good.)

Without doubt, the Supreme Court will eventually determine the validity of the health care law. In addition to the conflicting District Court rulings, Virginia’s Attorney General petitioned the Supreme Court on February 3rd for an expedited review of the Virginian ruling mentioned above. With the brief issued today in response to the Virginia ruling, as well as the exchange in the Florida ruling, the Justice Department similarly anticipates the highest court to weigh the issue.

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