Big Decision: Obamacare Gets Slapped Around By Supreme Court

By all accounts, today’s Supreme Court oral arguments were extremely lively. The hearing, which covered the individual mandate, matched the conservative constitutional wing of the Court – and Justice Kennedy – against the liberal wing of the Court, which inserted itself into the actual argumentation rather than asking questions.

It’s worth noting up front that oral arguments rarely decide Supreme Court cases. Rather, they grant the public a window into the thinking of the Justices prior to the ruling.

The lawyer for the government was Donald Verrilli; the lawyer for the State of Florida, which stands in for all states challenging Obamacare, was Paul Clement.

The Case For the Individual Mandate

Verrilli reportedly stumbled his way through his opening statement, which touched on all the basic Obamacare talking points: access to health insurance, lack of “affordable health insurance,” and supposed “discrimination against people based on their medical history” in the private market. The legal justification for Obamacare, Verrilli said, could be found in the Commerce Clause – the clause which states that the feds have the power “To regulate Commerce … among the several States.” Over time, the Courts have read this power more and more broadly, stating that many things that affect interstate commerce can be regulated, even if they only affect interstate commerce indirectly. The Court has never held, however, that the federal government can mandate individual purchase of product.

Everyone recognizes that Justice Kennedy is, in all likelihood, the deciding vote for or against Obamacare in this case. It was surprising, therefore, to see Kennedy jump into the fray immediately, asking aggressive questions about the legislation. “Can you create commerce in order to regulate it?” Kennedy asked, querying whether the government could force people to buy insurance and then justify that use of force by claiming that it was regulating commerce. Verrilli elided the question. Justice Scalia, however, chimed in, asking, “if I’m in any market at all, my failure to purchase something in that market subjects me to regulation”? Once again, Verrilli attempted to avoid the question. Then Justice Roberts joined in, asking whether the government could “require you to buy a cell phone”? And, yet again, Verrilli sidestepped. So Justice Alito got in on the act with a semi-comic hypothetical: could the government force somebody to buy burial services, since at some point, everyone will need to be buried, and somebody will have to pay for it? Verrilli struggled to fend off the attack – and ultimately, failed.

Finally, Justice Ginsburg stepped in to make Verrilli’s defense for him. Rather than asking questions, she simply stated, “If you’re going to have insurance, that’s how insurance works.” Verrilli, recognizing his cue, launched into a diatribe … and was cut off by Justice Kennedy, who asked a telling question: “Assume for the moment that this is unprecedented, this is a step beyond what our cases have allowed, the affirmative duty to act to go into commerce. If that is so, do you not have a heavy burden of justification?” Verrilli was once again at a loss. The weakness of his argument became even clearer when Justice Scalia asked whether the government could force people to buy broccoli, since there is a market in food to which many people do not have proper access.

And once again, Justice Ginsburg stepped in to save Verrilli. And then Justice Breyer stepped in, backing up Ginsburg. Finally, so did Justices Sotomayor and Kagan. The lines were clear: this wasn’t about Verrilli anymore. This would be Ginsburg and Breyer and Sotomayor and Kagan arguing against Kennedy, Scalia, Roberts, and Alito. Justice Thomas almost never participates in oral argument, which he considers a massive waste of time, but there is no doubt that he will stand against Obamacare, which he will surely consider an exercise of federal power not granted under the Constitution.

Throughout the day, Verrilli struggled with the basics of his argument. Justice Scalia bashed him about on Tenth Amendment grounds, stating that “the argument here is that the people were left to decide whether they want to buy insurance or not.” Justice Roberts backed him on that point, explaining that “the States are not limited to enumerated powers. The Federal Government is.” And Justice Kennedy went even further, stating that the individual mandate “changes the relationship of the Federal Government to the individual in a very fundamental way.”

Justice Scalia even gave Verrilli a tutorial on simple economics, explaining that if you want people to buy health care coverage when they’re young and healthy, you have to allow insurance companies to deny them coverage based on pre-existing conditions. As Justice Scalia pointed out, the problem Obamacare was designed to solve was the lack of affordable healthcare coverage for people who couldn’t afford it. That problem was caused by insurance companies having to spend too much thanks to regulations preventing them from taking into account pre-existing conditions. That regulation, in turn, incentivized people not to buy insurance until they’re unhealthy. That situation made insurance unaffordable. As Scalia said, “It’s a self-created problem.”

Is The Individual Mandate a Tax?

The hearing then moved to the question of whether this was a “tax,” and therefore an exercise of the government’s power to tax under the Constitution. Even the liberal justices seemed stumped by this argument. Justice Kagan asked, “here we have a case in which Congress determinedly said, this is not a tax, and the question is why should that be irrelevant?” Justice Scalia, obviously annoyed by this whole line of inquiry, smacked Verrilli around rhetorically: “You’re saying that all the discussion we had earlier about how this is one big uniform scheme and the Commerce Clause, blah, blah, blah, it really doesn’t matter. This is a tax …. Extraordinary.”

The Case Against the Individual Mandate

Clement led off his argument by explaining that the Commerce Clause “does not give Congress the … power to compel people to enter commerce, to create commerce essentially in the first place.” Justice Kagan tried to make the argument that Congress typically regulates at the “point of sale” – meaning that if you want to buy insurance, you have to buy it in a certain way. All the current law does is speed that up, since everyone will presumably need insurance. Clement shot her down, explaining that some people don’t want to buy insurance, and should be free not to do so. Forcing people to buy insurance is a different proposition from telling people how they must buy insurance if they want to buy it.

Eventually, the liberal Justices began rewriting legislation for Congresspeople, trying to prod Clement to state how an Obamacare-type law could be Constitutional. Sotomayor asked if it would be Constitutional to force everyone to pay a tax, but give them a tax credit if they have health insurance. Clement answered that it might be. Herein lies the problem for conservatives: liberals will eventually find a way to ram a form of Obamacare through the courts. That’s why they must be stopped legislatively next time.

Perhaps the funniest exchange of the day came when Justice Breyer, in the guise of a question, began arguing the liberal case for Obamacare. He quasi-asked – the question took more than two pages in the transcript -- whether the federal government has already Constitutionally forced people to act by restricting them from growing marijuana in their home, or wheat in their back yard; he asked whether Congress could mandate affirmative action; he asked whether Congress could mandate a minimum speed limit; he asked whether Congress could mandate inoculations. Just as Breyer was about to get to his point, Scalia interjected, “Answer those questions in inverse order.” At the Supreme Court, that’s better than Second City.

The key question was asked by Justice Breyer, and it really cut to the heart of the matter: “Do you think you can, better than the actuaries or better than the members of Congress who worked on it, look at the 40 million people who are not insured and say which ones next year will or will not use, say, emergency care?” This, of course, was not the point – the point is whether it’s an individual right not to buy health insurance. But this is also the crux of the liberal argument: the experts know better than you do what’s good for you. So sit down and shut up.

That was essentially what the liberal justices tried to do, filibustering Clement until the conservative justices stepped in to police. And this is worth noting: the conservative justices did not step in and make the affirmative case on behalf of Clement, as the liberal justices did with Verrilli. That, in and of itself, is proof that Constitutional conservative judges are less ideological and more textually-bound than their liberal counterparts.

The arguments continued at length, but the Justices’ examination of Verrilli and Clement were largely comprehensive in scope.

Conclusions

It seems likely that the individual mandate will be struck down 5-4, with Kennedy providing the deciding vote. Tomorrow, we move on to the question of severability – if the individual mandate is unconstitutional, must the entire bill be scrapped? Stay tuned.



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