Judges don’t tip hand in Obamacare hearing
ADDED at 3:55 p.m.: C-SPAN is streaming the hearing here.
Anyone expecting to get a hint as to which way three appellate judges will rule on the Obamacare lawsuit brought by Georgia and 25 other states was surely disappointed today. The two hours scheduled for arguments stretched into two and a half hours as the judges grilled both sides but didn’t tip their hands.
The panel of the 11th U.S. Circuit Court of Appeals, hearing the federal government’s appeal of a ruling from a U.S. district judge in Florida that declared the entire health-reform law unconstitutional, seemed most interested in these questions (listed in no particular order):
- Could they throw out the individual mandate and leave all or most of the rest of the law intact? (The acting solicitor general, Neal Katyal, begrudgingly said only a few of the other provisions would have to be excised if the individual mandate were eliminated; attorneys for the 26 states and the National Federation of Independent Business insisted the individual mandate is crucial to the entire law, including its expansion of Medicaid, and that it’s all or nothing.)
- Has there ever been a Commerce Clause case like this one — in which the federal government ordered private individuals to purchase a private product — and, if not, is that because health insurance is a unique service or because Congress is trying to expand its powers? (Neither side could offer a precedent wholly analogous to this one. The government predictably argued that health insurance — actually, health care; more on the distinction in a moment — is unique while, as one would expect, the plaintiffs pointed out that the Constitution had existed more than 220 years before Congress attempted such a compulsion.)
- As I alluded, the distinction between health insurance and health care figured prominently. The government and the judges noted that the plaintiffs concede Congress could regulate the method of payment for health care; the plaintiffs’ distinction was that, at that point, the consumer had entered the market for health care.
- The government pounced on Judge Frank Hull’s question, based on the Supreme Court’s ruling in the Raich case, as to whether we aren’t an “instant away” from requiring health care, and whether it wouldn’t be appropriate for Congress to regulate “method of payment” well before health care was needed. The plaintiffs maintained that compulsion is not the same thing as regulation; that Congress instead could have offered incentives for people to purchase and use insurance as their method of payment, as it has done in every other instance of encouraging a particular behavior; and that insurance of any type (life, auto, flood, etc.) is inherently an “instant away” product.
- As an aside, when the incentives bit came up, I wrote this in my notes: “You can lead a horse to water, but you can’t pry open his mouth and shove a water hose down his throat.” Not quite what the original aphorism says, but a succinct summary of what the plaintiffs — rightly, imo — argue.
- It was unclear how impressed the judges were by the government’s argument about cost-shifting, in which Katyal said unpaid medical bills by the uninsured shifted $43 billion a year in costs to those with insurance. Hull pointed out that $43 billion is just 1.7 percent of the $2.5 trillion Americans spend on health care each year. The plaintiffs maintained that the individual mandate was an unconstitutional way to solve the problem.
- The judges seemed preoccupied with the question of whether there could be any real limits to Congress’ power under the Commerce Clause if Obamacare were upheld. My sense is that Katyal did not alleviate those concerns.
I’ll add more as I go back through my notes. Gun to my head, I’d predict two and possibly all three of the judges declare the mandate unconstitutional, along with perhaps some directly related insurance reforms (e.g., guaranteed issue), and may also throw out the Medicaid expansion — which is the bulk of the states’ case but hasn’t gotten as much attention as the mandate — but will not declare the entire act unlawful.
And then, in a prediction I’d just about bet the house on, this case will go to the Supreme Court.
[NB: I've fixed a few typos throughout since this was first posted.]
– By Kyle Wingfield
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