Health Care Reform Unconstitutional, District Judge Rules

Judge Henry Hudson (E.D. Va.) today in Virginia v. Sebelius ruled the individual health-insurance mandate in the federal health care reform package unconstitutional.  Judge Hudson ruled that the individual mandate exceeded Congress's authority under the Commerce Clause, the Necessary and Proper Clause, and the General Welfare (Tax) Clause.  The decision was unsurprising.  (Judge Hudson previously denied the government's motion to dismiss, anticipating his ruling on the merits here.)  Here are some highlights:

• The Commerce Clause.  Judge Hudson ruled that the individual mandate exceeded congressional authority under the Commerce Clause, because it regulates "inactivity," not economic activity.  Judge Hudson described this as unprecedented--leading to unfettered congressional authority.  The mandate wasn't saved by an aggregation theory, taking the aggregate economic effect of decisions not to purchase health insurance.
• The Necessary and Proper Clause.  Judge Hudson ruled that the Necessary and Proper Clause added nothing to the Commerce Clause: If the power's not in the Commerce Clause, the Necessary and Proper Clause doesn't give Congress the power to do it.  This is rather breathtaking, given the Supreme Court's ruling last term in U.S. v. Comstock, upholding the federal civil commitment statute under the Necessary and Proper Clause, and, in the course, reinforcing a broad reading of the Necessary and Proper Clause.
• The General Welfare Clause.  Judge Hudson ruled that the mandate operated as a penalty masquerading as a tax.  Interestingly, he pointed to congressional intent here, suggesting that the tax for failing to purchase health insurance is, in fact, a penalty.  (He didn't similarly defer to Congress on the Commerce Clause and Necessary and Proper Clause.)
• The Tenth Amendment.  The Tenth Amendment played a very minor role in the decision.  Judge Hudson quoted it at the end of his tax analysis, writing first that Congress has defined authority under the Constitution under Article I, Section 8, and next merely quoting and citing the Tenth Amendment.
• Relief.  Judge Hudson severed the individual mandate and directly dependent provisions from the rest of the legislation, ruling that only those sections are unconstitutional (and preserving the rest of the legislation).  He also only issued a declaratory judgment, not injunctive relief.  The ruling is thus quite narrow and recognizes that the issue will be resolved finally in the higher courts.

We most recently posted on health reform lawsuits here, in Liberty University v. Geithner.  In that case, the federal district judge dismissed a similar constitutional challenge to reform.  Check out the ACA Litigation Blog for litigation documents in all these cases.

SDS