One of the more controversial provisions included in the Patient Protection and Affordable Care Act (the Affordable Care Act) is the requirement for individuals to purchase and maintain health insurance coverage. Commonly referred to as the individual mandate, the constitutionality of this requirement is the subject of litigation. The Supreme Court has agreed to hear appeals from an 11th Circuit Court ruling that struck down the individual mandate. Both the 6th Circuit and the Washington, DC Circuit have issued opinions upholding the legality of the individual mandate.
The issue from a layman’s view appears to be whether Congress can pass a law that: (1) requires individuals to purchase something (in this case health insurance) from a third party and (2) imposes a financial penalty those who fail to make the required purchase.
The government’s rationale for the individual mandate is as follows. By requiring everyone able to pay the cost of insurance coverage to do so, healthy individuals cannot opt out of the insurance pool. If healthy people were to opt out, rates for those insured would be higher than if the healthy people also purchased insurance. The penalty is intended to incent those people who are wavering to purchase the required coverage.
Those who object to the individual mandate believe that imposing a penalty on individuals for their failure to purchase goods or services from a commercial business is a violation of personal liberty guaranteed by the United States Constitution. If Congress can require citizens to purchase health insurance, what else may we have to purchase?
The ultimate decision of the Supreme Court may depend on whether the penalty provision is considered a tax. Under the Constitution, Congress is given substantial powers to collect taxes in order to provide for the general welfare of the country and its people. Unfortunately, for those who favor the individual mandate, and primarily for political reasons, Congress avoided referring to the penalty as a tax when drafting and voting on the Affordable Care Act. Apparently, political expediency was valued more than political leadership.