Sunday, May 16, 2010

Government Defends Individual Health Insurance Mandate

The Justice Department last week filed its first defense of the new health insurance mandate in federal court.  The government responded to the plaintiffs' motion for a preliminary injunction in Thomas More Law Center, et al. v. Obama in the Eastern District of Michigan, a case filed just after President Obama signed into law the Patient Protection and Affordable Care Act (the health care reform act), which includes the mandate.

Plaintiffs filed their motion and brief on April 5, arguing that Congress lacked authority under the Commerce Clause to require individuals to purchase health insurance.  The arguments are by now all too familiar; from the plaintiffs' brief:

The Act does not even pretend to fit within any of the Court's previous Commerce Clause rulings.  The Individual Mandate attaches to a legal resident of the United States who chooses to sit at home and do nothing.  This resident is, quite literally, merely existing.  He or she is neither engaged in economic activity nor in any other activity that would bring him or her within the reach of even a legitimate regulatory scheme. . . .  In this case, we have neither economics nor activities.

. . .

If the Act is understood to fall within Congress' Commerce Clause authority, the federal government will have the absolute and unfettered power to create complex regulatory schemes to fix every perceived problem imaginable and to do so by ordering private citizens to engage in affirmative acts, under penalty of law, such as taking vitamins, losing weight, joining health clubs, buying a GMC truck, or purchasing an AIG insurance policy, among others.  The term "Nanny State" does not even begin to describe what we will have wrought if in fact the Health Care Reform Act falls within any imaginable governmental authority.  To be sure, George Orwell's 1984 will be just the primer for our new civics.

(Citations, primarily to Wickard v. Filburn, U.S. v. Lopez, U.S. v. Morrison, and Gonzales v. Raich, omitted.)

The government responded that the plaintiffs lacked standing--no actual or imminent injury and no ripeness, because the mandate doesn't go into place until 2014, and the plaintiffs' situations may change between now and then.  On the merits, the government argued both Commerce Clause and Taxing Clause.  As to the activity-inactivity distinction that has attracted so much attention in Commerce Clause arguments, it wrote:

Plaintiffs' claim that individuals who forgo health insurance are not engaged in any economic "activity," is fallacious.  Some individuals make what Congress found is an "economic and financial decision" to try to pay for health care services without reliance on insurance.  Indeed, plaintiffs here concede that they intend to "pay for health care services as [they] need them."  Plaintiffs thus have not opted out of health care; they are not passive bystanders divorced from the health care market.  They have made a choice regarding the method of payment for the services they expect to received, no less "active" than a decision to pay by credit card rather than by check.

The government went on to argue that the mandate is an essential part of the larger health reform package and therefore within Congress's Commerce Clause authority under Raich, and that the mandate also falls under Congress's broad taxing power in the general welfare as a legitimate revenue-raising device notwithstanding its regulatory goal.


Commerce Clause, Congressional Authority, Recent Cases, Taxing Clause | Permalink

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This is very interesting. Great read!

Posted by: Jim | May 28, 2010 2:01:15 PM

To single out GMC or AIG is just sensationalism on the part of the plaintiff. The fact that millions choose to not have health insurance does not imply that they have the capacity to pay for health care needs as they arise. If they can't pay, which they often can't, our compassionate system still provides care and the cost is absorbed by the payors and providers of services. Furthermore, our bankruptcy laws allow the receipient to discharge their medical debt without recourse. The health care reform requires both carrots and sticks and I applaud those who had the courage to enact it.

Posted by: Rob | Jun 18, 2010 9:51:21 PM

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