We are likely to learn in late June the fate of Obamacare, the term often used by its critics to denote the Affordable Health Care (AHA). People can disagree about the wisdom of this ambitious reform of the U.S. healthcare industry, but I do not think it can reasonably be disputed that the measure exceeds Congress’ power to regulate interstate commerce. The oral argument on March 28 suggests, however, that the five Justices appointed by Republican presidents are sufficiently troubled by the AHA provision mandating individuals to purchase healthcare insurance coverage that they will strike down the mandate and several related provisions.
Two distinct concerns have been raised about the individual mandate, only one of which is directly relevant to the question of Congressional power.
The first concern is a libertarian one—an argument about the liberty of the individual vis-à-vis all government. Should the government, whether federal or state, be able to force anyone to buy a particular product, in this, health insurance? As a constitutional matter, this liberty-based concern is a weak one; government often make us do things we do not want to do. We cannot smoke tobacco products in public areas; we must wear seat belts and cannot use our phones while driving a motor vehicle; we even have to buy insurance for our car if we are going to drive, or insurance for our home if we want mortgage financing.
It is usually a sufficient answer to this type of liberty objection that government can regulate our conduct to the extent it affects, or can reasonably be believed to affect, third parties. Indeed, it was common ground among all the parties to the Obamacare litigation that, as has Massachusetts, the states could enact similar individual mandates for their citizens and residents.
The second concern raised at the oral argument does bear on the scope of federal power. As the argument runs, Congress can regulate interstate activity but it cannot regulate “inactivity.” This claim enjoys a superficial plausibility but cannot withstand analysis. We have here “inactivity” only in a formal, temporary sense.
Congress expressly found in the AHA that the failure of individuals to purchase health insurance knowing they can ultimately fall back on the legally mandated charity obligations of hospitals does affect the interstate pricing and distribution of healthcare services. Thus, for example, hospitals must charge their insured patients more to subsidize those who despite their “inactivity” (in not purchasing insurance) will still get sick and still need hospital care. Obamacare’s opponents conceded that Congress could require these momentarily inactive, but ultimate consumers of healthcare to pay for healthcare at the point that services are actually rendered.
It is not clear, however, why this line is constitutionally required, why the Constitution bars Congress from using the insurance mechanism to better spread out the costs of such ultimate use of medical services.
Related to the inactivity argument is that notion, voiced repeatedly by the skeptical Justices, that the government could not offer logical stopping point. What is to stop some future Congress from requiring individuals to purchase broccoli or physical fitness services. Yet, both Congress in the AHA and the solicitor general, representing the government, gave ample ground for believing that the healthcare industry was special because of the “free rider” effect (described above) and the already pervasive role of the federal government in the healthcare industry.
Any power can be abused. However, respect for Congress, which after all is the principal policymaking branch in our system, requires confronting these issues when they arise, rather than judging this law against hypothetical statutes that are highly unlikely ever to be considered seriously let alone become law.
Ultimately, the people have a right to rule themselves. The courts do have an important role to play in enforcing constitutional limits, but they stray from that role when they seek to implement personal policy preferences.
Given the fact that healthcare expenditures account for one-eighth of the gross national product, and that the federal government has been intimately involved in structuring and funding the healthcare market—starting with the initial federal tax advantaging of employer-based health expenditures during World War II, and continuing with Medicare, Medicaid, prescription healthcare, group insurance continuation coverage, and so on—it seems difficult to take seriously the contention that this is a domain of state rights that needs to be shielded from an oppressive federal government.
Samuel Estreicher is the Dwight D. Opperman Professor of Law and co-director of the Opperman Institute of Judicial Administration at New York University.