Today's Health Care Decision: Some Potential Implications for Environmental Law

As many scholars already have noted throughout the afternoon, today’s decision by the U.S. Supreme Court to uphold the basic provisions of the Patient Protection and Affordable Care Act could have important implications for environmental law moving forward. 

In an opinion authored by Chief Justice Roberts and joined by Justices Ginsburg, Breyer, Sotomayor, and Kagan, the Court concluded that the Act’s requirement that certain individuals pay a penalty for failing to obtain health insurance could reasonably be characterized as a constitutional tax.  However, the Chief Justice joined Justices Scalia, Kennedy, Thomas, and Alito in concluding that Congress’s power to regulate interstate commerce did not authorize this minimum coverage provision.  Moreover, by a vote of 7-2, the Court struck down as violative of the Constitution’s Spending Clause a portion of the Act that would have required states to either acquiesce to an expansion of Medicaid or sacrifice existing federal Medicaid contributions.  In a statement read from the bench, Justice Ginsburg asserted that “the Affordable Health Care Act survives largely unscathed, but the court’s Commerce Clause and Spending Clause jurisprudence has been set awry.  My expectation is that the setbacks will be temporary blips, not permanent obstructions.”

On the environmental front, preliminary analysis suggests that the potential ramifications largely fall into two categories.  First, it is possible that the Court’s pronouncement on the Commerce Clause could prompt new challenges to federal laws seeking to protect and preserve natural resources and public health.  (Yet, as Ann Carlson notes on Legal Planet, environmental laws do not mandate that people enter a stream of commerce; instead, they seek to regulate the harmful effects of commerce.)  Second, the Court’s conclusion on the Medicaid expansion issue could open the door to challenges to laws pertaining to other federally financed state programs; for example, the Clean Air Act’s provisions that authorize the federal government to withhold federal highway funding in the event states fail to revise their plans to reduce air pollution to meet federally-specified air quality standards.  (However, Jonathan Zasloff, also on Legal Planet, explains several key differences between the Medicaid provision and the Clean Air Act’s provision regarding potential elimination of federal highway funds, including the fact that such highway funds are appropriated every year and thus may not amount to entitlements on which the states reasonably can rely.)

In addition to these two broad categories, there certainly could be more specific impacts to environmental law lurking in the nearly 200-page decision issued this morning.  For one, as I followed the decision’s coverage surrounding Chief Justice Roberts’ deferential understanding of the government’s ability to levy taxes, I thought of Eduardo Penalver’s thought-provoking article entitled Regulatory Taxings, 104 Colum. L. Rev. 2182 (2004). 

Penalver described the tension between (1) the U.S. Supreme Court’s relatively recent expansive, if indeterminate, reading of the Takings Clause to reach beyond outright government appropriations of property, and (2) the Court’s long history of recognizing a nearly illimitable power to tax.  (Admittedly, Penalver authored the piece prior to the Court’s deciding Lingle v. Chevron and Kelo v. New London, both of which arguably slowed the pace of this expansion of federal takings law; nonetheless, his basic premise regarding the differing constitutional treatment of takings and taxes largely remains accurate.)  Penalver suggested that any theoretical attempt to reconcile current prohibitions on takings with the constitutional treatment of taxation yields a category of “regulatory taxings,” i.e., “state actions that although viewed as takings under current doctrine, cannot be distinguished from taxes under the particular ‘reconciling theory’ examined.”

Some scholars, most notably Richard Epstein, have drawn on this tension to attack the very legitimacy of many taxes.  Penalver, however, critiqued Epstein’s approach “to redefine a settled area of law (tax law) by reference to a novel theory of a doctrine (takings law) badly in need of concrete definition.”  Alternatively, Penalver suggested that one might “run [Epstein’s] argument in the other direction” and “use the settled law of taxation as a constitutional fixed point around which to more clearly [and, necessarily, more narrowly] define the law of takings.” 

In today’s opinion, Chief Justice Roberts demonstrated principled regard for the longstanding, extensive judicial deference towards taxation.  Such deference to the government’s taxing power could forecast his views in future takings cases, many of which often involve challenges to environmental regulations.   That, though, is only the case if the Chief Justice concurs with Penalver, Epstein, and others that the inconsistency between takings and taxation jurisprudence needs resolution.

-Tim Mulvaney