More on the Constitutionality of Healthcare Reform: A Warning to Conservatives

According to multiple news sources, several state attorneys general are poised to bring legal challenges to the healthcare reform legislation.  According to most sources, the legal challenges will center around the constitutionality of the individual mandate.

Commerce Clause and Taxation Power
Most legal analysis I have found on this subject concludes that Congress has at least two sources of authority to mandate the purchase of health insurance. These include the commerce clause and the taxation power. The individual mandate is literally drafted as a tax on uninsured individuals. It is also part of a larger statute regulating interstate commerce -- which is a standard that the Supreme Court, including Justice Scalia, has approved to test the legitimacy of regulations of noneconomic activity. I have written on this subject before. Please feel free to read that analysis.

Irony
There is an interesting irony in many of the conservative objections to the individual mandate. Conservatives argue that Congress cannot use its commerce power to compel individuals to enter into commerce (i.e., purchase health insurance). While I would argue that Congress is really using its commerce and taxing power to entice people to cover the risks associated with their own health, that is a side argument.

Most importantly, conservative arguments in this area unwittingly support more expansive regulation. Here's why.

Conservatives believe that Congress cannot mandate that individuals purchase insurance. In order to avoid this outcome, Congress could have raised taxes on everyone, created a public plan, and fully subsidized participation by indigent uninsured individuals. This alternative is more expansive than the voted upon exchange system, coupled with a mandate. The latter option uses a market based approach. The public plan, however, represents government sponsorship of health care.  Yet, because the public plan would not involve coercion, it is presumably fine under existing commerce clause and taxation precedent -- according to conservative logic.

Clearly, conservatives cannot contest a public plan on constitutional grounds, as this is the same as Medicare, Medicaid, TRICARE, SCHIP and other government-sponsored plans.  Accordingly, Congress could have chosen this more expansive route, but this is certainly not what conservatives want.

Misstatements
Conservatives also argue that Congress has never used its commerce power to force individuals to engage in commercial activities. That point is not true.

Take two leading cases on the commerce clause: Wickard v. Filburn and Gonzales v. Raich. In Wickard, the Court upheld a production limit on wheat as applied to someone who produced and consumed "home grown" wheat. Congress did not want suppliers to produce more than the statutory maximum because doing so would result in lower prices.  The law was a basic price control. But for the homegrown wheat consumer, enforcement of this requirement would mean individuals had to purchase wheat on the open market.  The Court, however, validated this outcome.

In Raich, the Court (a 7-2 majority, including Justice Scalia) upheld the enforcement of federal drug laws that ban possession of marijuana. The Court concluded that the federal government could enforce the laws against someone who used homegrown marijuana for medical purposes. Consequently, the individual would have to purchase some alternative treatment on the open market (as in Wickard). This outcome, however, did not render enforcement unconstitutional.

Similarly, with respect to the insurance mandate, Congress has determined that the alternatives to having almost universal coverage are an impediment to commerce. Removing this impediment will require a few consumers who are uninsured to purchase insurance, but this is not a novel concept. It is true that the regulations in the other cases did not directly mandate that individuals engage in commerce, but this was the impact of the regulations in those cases.

Distraction
Even assuming that the Supreme Court finds the mandate unconstitutional, the Court would not then invalidate the entire statute. Instead, it would only invalidate the mandate itself. This would leave intact the many other components of the legislation that conservatives presumably loathe. Many conservatives, however, seem to believe that if the mandate is declared unconstitutional, that they have defeated healthcare reform. That is untrue. They will simply have defeated the mandate, which President Obama campaigned against in the first place.

Furthermore, if the Court invalidates the mandate, Congress could implement a voluntary public plan option (see above). It could also expand the income limits for Medicaid or lower the age requirements for Medicare to cover many uninsured individuals. Also, Congress could (and almost certainly would) continue to subsidize the purchase of insurance by individuals who cannot afford to do so. Accordingly, attacking the mandate does not seem to carry much promise for opponents of the legislation.  It could, in fact, open the door to more expansive approaches.

See also: Is Healthcare Reform "Unconstitutional"? No -- Why Rivkin and Casey Are Wrong

UPDATE: It is unclear that a state attorney general would even have standing to bring a suit in federal court regarding the mandate. The mandate applies to individuals, not to state governments. Also, the mandate does not take effect immediately. Federal courts could avoid this litigation altogether if standing does not exist.

The Onion Outshines the Media Again With Story on Health Insurance

In today's era of corporate journalism, comedy outlets often provide serious analysis of current events, while mainstream media sources supply laughter (perhaps to hide the emptiness). Although Jon Stewart gets most of the kudos in this bizarre inversion, The Onion is far superior in my opinion.

Today, The Onion comments on the impact of rising healthcare costs and the lack of insurance on "average" Americans. I have previously argued that the current discourse has failed to analyze the problems related to a lack of insurance. By contrast, during the presidential campaigns, this issue occupied center stage and captured the attention and empathy of many voters. The Onion attempts to fill the void with this story: Man Succumbs To 7-Year Battle With Health Insurance.

Here's a snip:

After years of battling crippling premiums and agonizing deductibles, local resident Michael Haige finally succumbed this week to the health insurance policy that had ravaged his adult life. . . .

Once a healthy and happy father of two, Haige saw his life forever change seven years ago when health insurance professionals diagnosed him with a preexisting condition. As months passed and his line of credit continued to deteriorate, the former high school football coach would experience excruciating headaches and bouts of nausea every time another hospital bill arrived. . . .

According to an independent study released last month by the Mayo Clinic, health insurance is the nation's No. 2 cause of death, claiming the lives of some 400,000 Americans each year. A silent killer, health insurance often strikes without warning, its harmful and profit-based policies avoiding detection until it is far too late. Although the cruel bureaucratic disorder does not discriminate, statistics have shown that senior citizens, young dependents, and those woefully underemployed are most at risk. . . .

EXCELLENT STUFF. Make sure you visit the site: Man Succumbs To 7-Year Battle With Health Insurance.