Floyd Reports

In 1936, the comic geniuses known as The Three Stooges filmed a “short” entitled “Disorder in the Court.” They probably didn’t realize how prophetic that title would become in 2012 in light of the recent Supreme Court ruling on “Obamacare”. For several days now, we’ve been listening to media pundits on television, talk radio, newspapers, and the Internet. Predictably, opinions have been across the board, ranging from high praise to disdain and anger. Surprisingly, however, some of the views coming from notable political commentators on the conservative side of the aisle have not been consistent. For example, Hugh Hewitt believes that Justice Roberts is correct in his opinion and will be vindicated by events that will unfold over the next several months. Other conservatives, including Mark Levin, are furious with Justice Roberts’s decision to uphold this poorly written piece of health-care legislation.

The truth is, this is a very complicated issue with several facets that seem to obscure some of the over-arching Constitutional principles that are now at risk. It’s also a very long-winded topic, as testament to the fact that Supreme Court opinions were conveyed using 194 pages, or roughly 63,000 words. Very few people will take the time to read it, and I’m sure that we all have many other things we would rather do with our day than to slog through ongoing text, which at times can be rather tedious. But I took it upon myself to read every word of the opinions. Why? Because I don’t trust the summary and conflicting conclusions of the media pundits when there appears to be so much noise and dust emanating from the national dialogue. I wanted to understand exactly what the justices were communicating. During the course of that effort, I decided to highlight specific sentences and paragraphs that I believe capture the more important points of their decisions. As a result, 63,000 words have been whittled down to 6500 words, which seems small enough to get our arms around.

So here’s the result. Each excerpt is also followed by my brief comments, which are limited to “agree”, “disagree” and “reference”. Read for yourself if you’re interested. Then come to your own conclusions regarding this disorder in the court. I welcome your comments and will probably follow up with another article explaining my insights.

NATIONAL FEDERATION OF INDEPENDENT BUSINESS v. SEBELIUS Opinion of ROBERTS, C. J.
We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders. We ask only whether Congress has the power under the Constitution to enact the challenged provisions.
Craig’s Comment: Agree

…rather than granting general authority to perform all the conceivable functions of government, the Constitution lists, or enumerates, the Federal Government’s powers.
Craig’s Comment: Agree

The Constitution’s express conferral of some powers makes clear that it does not grant others.
Craig’s Comment: Agree

“The powers not delegated to the United States by the Constitution . . . are reserved to the States respectively, or to the people.”
Craig’s Comment: reference

The Constitution may restrict state governments-as it does, for example, by forbidding them to deny any person the equal protection of the laws. But where such prohibitions do not apply, state governments do not need constitutional authorization to act. The States thus can and do perform many of the vital functions of modern government
Craig’s Comment: Agree

Because the police power is controlled by 50 different States instead of one national sovereign, the facets of governing that touch on citizens’ daily lives are normally administered by smaller governments closer to the governed. The Framers thus ensured that powers which “in the ordinary course of affairs, concern the lives, liberties, and properties of the people” were held by governments more local and more accountable than a distant federal bureaucracy.
Craig’s Comment: Agree

Congress may also “lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States.” U. S. Const., Art. I, §8, cl. 1. Put simply, Congress may tax and spend. This grant gives the Federal Government considerable influence even in areas where it cannot directly regulate. The Federal Government may enact a tax on an activity that it cannot authorize, forbid, or otherwise control.
Craig’s Comment: Agree, but this power has been abused.

In 2010, Congress enacted the Patient Protection and Affordable Care Act, 124 Stat. 119. The Act aims to increase the number of Americans covered by health insurance and decrease the cost of health care. The Act’s 10 titles stretch over 900 pages and contain hundreds of provisions. This case concerns constitutional challenges to two key provisions, commonly referred to as the individual mandate and the Medicaid expansion. The individual mandate requires most Americans to maintain “minimum essential” health insurance coverage.
Craig’s Comment: reference

Beginning in 2014, those who do not comply with the mandate must make a “[s]hared responsibility payment” to the Federal Government
Craig’s Comment: reference

In 2016, for example, the penalty will be 2.5 percent of an individual’s household income , but no less than $695 and no more than the average yearly premium for insurance that covers 60 percent of the cost of 10 specified services (e.g., prescription drugs and hospitalization). Ibid.; 42 U. S. C. §18022. The Act provides that the penalty will be paid to the Internal Revenue Service with an individual’s taxes, and “shall be assessed and collected in the same manner”
Craig’s Comment: reference

The plaintiffs alleged, among other things, that the individual mandate provisions of the Act exceeded Congress’s powers under Article I of the Constitution.
Craig’s Comment: Agree

The second provision of the Affordable Care Act directly challenged here is the Medicaid expansion.
Craig’s Comment: reference

In order to receive that funding, States must comply with federal criteria governing matters such as who receives care and what services are provided at what cost. By 1982 every State had chosen to participate in Medicaid.
Craig’s Comment: reference

The Affordable Care Act expands the scope of the Medicaid program and increases the number of individuals the States must cover. For example, the Act requires state programs to provide Medicaid coverage to adults with incomes up to 133 percent of the federal poverty level
Craig’s Comment: reference

If a State does not comply with the Act’s new coverage requirements, it may lose not only the federal funding for those requirements, but all of its federal Medicaid funds.
Craig’s Comment: reference

Congress, however, chose to describe the “[s]hared responsibility payment” imposed on those who forgo health insurance not as a “tax,” but as a “penalty.”
Craig’s Comment: Agree

According to the Government, even if Congress lacks the power to direct individuals to buy insurance, the only effect of the individual mandate is to raise taxes on those who do not do so, and thus the law may be upheld as a tax.
Craig’s Comment: Disagree

Because state and federal laws nonetheless require hospitals to provide a certain degree of care to individuals without regard to their ability to pay, see, e.g., 42 U. S. C. §1395dd; Fla. Stat. Ann. §395.1041, hospitals end up receiving compensation for only a portion of the services they provide. To recoup the losses, hospitals pass on the cost to insurers through higher rates, and insurers, in turn, pass on the cost to policy holders in the form of higher premiums.
Craig’s Comment: Agree

By requiring that individuals purchase health insurance, the mandate prevents cost-shifting by those who would otherwise go without it.
Craig’s Comment: Disagree

The Government contends that the individual mandate is within Congress’s power because the failure to purchase insurance “has a substantial and deleterious effect on interstate commerce” by creating the cost-shifting problem.
Craig’s Comment: Disagree

Given its expansive scope, it is no surprise that Congress has employed the commerce power in a wide variety of ways to address the pressing needs of the time. But Congress has never attempted to rely on that power to compel individuals not engaged in commerce to purchase an unwanted product.
Craig’s Comment: Agree

The language of the Constitution reflects the natural understanding that the power to regulate assumes there is already something to be regulated.
Craig’s Comment: Agree

Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority. Every day individuals do not do an infinite number of things.
Craig’s Comment: Agree

Allowing Congress to justify federal regulation by pointing to the effect of inaction on commerce would bring countless decisions an individual could potentially make within the scope of federal regulation, and-under the Government’s theory-empower Congress to make those decisions for him.
Craig’s Comment: Agree

Congress addressed the insurance problem by ordering everyone to buy insurance. Under the Government’s theory, Congress could address the diet problem by ordering everyone to buy vegetables.
Craig’s Comment: Agree

Under the Government’s logic, that authorizes Congress to use its commerce power to compel citizens to act as the Government would have them act. That is not the country the Framers of our Constitution envisioned.
Craig’s Comment: Agree

Accepting the Government’s theory would give Congress the same license to regulate what we do not do, fundamentally changing the relation between the citizen and the Federal Government
Craig’s Comment: Agree

The Commerce Clause is not a general license to regulate an individual from cradle to grave, simply because he will predictably engage in particular transactions. Any police power to regulate individuals as such, as opposed to their activities, remains vested in the States.
Craig’s Comment: Agree

In making its Commerce Clause argument, the Government defended the mandate as a regulation requiring individuals to purchase health insurance. The Government does not claim that the taxing power allows Congress to issue such a command.
Craig’s Comment: Agree

Congress thought it could enact such a command under the Commerce Clause, and the Government primarily defended the law on that basis. But, for the reasons explained above, the Commerce Clause does not give Congress that power. Under our precedent, it is therefore necessary to ask whether the Government’s alternative reading of the statute-that it only imposes a tax on those without insurance-is a reasonable one.
Craig’s Comment: Disagree

Under that theory, the mandate is not a legal command to buy insurance. Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earning income.
Craig’s Comment: Disagree

The Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution.
Craig’s Comment: Disagree

Indeed, the payment is expected to raise about $4 billion per year by 2017.
Craig’s Comment: reference

Congress apparently regards such extensive failure to comply with the mandate as tolerable suggests that Congress did not think it was creating four million outlaws. It suggests instead that the shared responsibility payment merely imposes a tax citizens may lawfully choose to pay in lieu of buying health insurance.
Craig’s Comment: Disagree

The joint dissenters argue that we cannot uphold §5000A as a tax because Congress did not “frame” it as such. Post, at 17. In effect, they contend that even if the Constitution permits Congress to do exactly what we interpret this statute to do, the law must be struck down because Congress used the wrong labels.
Craig’s Comment: Agree

According to the plaintiffs, if the individual mandate imposes a tax, it is a direct tax, and it is unconstitutional because Congress made no effort to apportion it among the States.
Craig’s Comment: Agree

Even if only a tax, the payment under §5000A(b) remains a burden that the Federal Government imposes for an omission, not an act. If it is troubling to interpret the Commerce Clause as authorizing Congress to regulate those who abstain from commerce, perhaps it should be similarly troubling to permit Congress to impose a tax for not doing something. Three considerations allay this concern. First, and most importantly, it is abundantly clear the Constitution does not guarantee that individuals may avoid taxation through inactivity. A capitation, after all, is a tax that everyone must pay simply for existing, and capitations are expressly contemplated by the Constitution. The Court today holds that our Constitution protects us from federal regulation under the Commerce Clause so long as we abstain from the regulated activity. But from its creation, the Constitution has made no such promise with respect to taxes.
Craig’s Comment: Agree

Upholding the individual mandate under the Taxing Clause thus does not recognize any new federal power.
Craig’s Comment: Disagree

The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness.
Craig’s Comment: Disagree

The Federal Government does not have the power to order people to buy health insurance. Section 5000A would therefore be unconstitutional if read as a command. The Federal Government does have the power to impose a tax on those without health insurance.
Craig’s Comment: Disagree

On average States cover only those unemployed parents who make less than 37 percent of the federal poverty level, and only those employed parents who make less than 63 percent of the poverty line.
Craig’s Comment: reference

The Medicaid provisions of the Affordable Care Act, in contrast, require States to expand their Medicaid programs by 2014 to cover all individuals under the age of 65 with incomes below 133 percent of the federal poverty line.
Craig’s Comment: reference

The Affordable Care Act provides that the Federal Government will pay 100 percent of the costs of covering these newly eligible individuals through 2016. §1396d(y)(1). In the following years, the federal payment level gradually decreases, to a minimum of 90 percent. Ibid. In light of the expansion in coverage mandated by the Act, the Federal Government estimates that its Medicaid spending will increase by approximately $100 billion per year, nearly 40 percent above current levels.
Craig’s Comment: reference

“the Constitution has never been understood to confer upon Congress the ability to require the States to govern according to Congress’ instructions.” New York, supra, at 162. Otherwise the two-government system established by the Framers would give way to a system that vests power in one central government, and individual liberty would suffer.
Craig’s Comment: Agree

Spending Clause programs do not pose this danger when a State has a legitimate choice whether to accept the federal conditions in exchange for federal funds. This threat serves no purpose other than to force unwilling States to sign up for the dramatic expansion in health care coverage effected by the Act. Given the nature of the threat and the programs at issue here, we must agree.
Craig’s Comment: Agree

The threatened loss of over 10 percent of a State’s overall budget, in contrast, is economic dragooning that leaves the States with no real option but to acquiesce in the Medicaid expansion.
Craig’s Comment: Agree

Under the Affordable Care Act, Medicaid is transformed into a program to meet the health care needs of the entire nonelderly population with income below 133 percent of the poverty level. It is no longer a program to care for the neediest among us, but rather an element of a comprehensive national plan to provide universal health insurance coverage.
Craig’s Comment: Agree

What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding.
Craig’s Comment: Agree

The Affordable Care Act is constitutional in part and unconstitutional in part. The individual mandate cannot be upheld as an exercise of Congress’s power under the Commerce Clause. That Clause authorizes Congress to regulate interstate commerce, not to order individuals to engage in it. In this case, however, it is reasonable to construe what Congress has done as increasing taxes on those who have a certain amount of income, but choose to go without health insurance. Such legislation is within Congress’s power to tax. As for the Medicaid expansion, that portion of the Affordable Care Act violates the Constitution by threatening existing Medicaid funding. Congress has no authority to order the States to regulate according to its instructions. Congress may offer the States grants and require the States to comply with accompanying conditions, but the States must have a genuine choice whether to accept the offer. The States are given no such choice in this case:
Craig’s Comment: Disagree

JUSTICE GINSBURG, with whom JUSTICE SOTOMAYOR joins, and with whom JUSTICE BREYER and JUSTICE KAGAN join as to Parts I, II, III, and IV, concurring in part, concurring in the judgment in part, and dissenting in part.

According to THE CHIEF JUSTICE, the Commerce Clause does not permit that preservation. This rigid reading of the Clause makes scant sense and is stunningly retrogressive.
Craig’s Comment: Disagree

THE CHIEF JUSTICE’s crabbed reading of the Commerce Clause harks back to the era in which the Court routinely thwarted Congress’ efforts to regulate the national economy in the interest of those who labor to sustain it.
Craig’s Comment: Disagree

Over 60% of those without insurance visit a doctor’s office or emergency room in a given year.
Craig’s Comment: Agree

The large number of individuals without health insur­ ance, Congress found, heavily burdens the national health-care market.
Craig’s Comment: Agree

Federal and state law, as well as professional obligations and embed­ ded social norms, require hospitals and physicians to provide care when it is most needed, regardless of the patient’s ability to pay.
Craig’s Comment: Agree

States cannot resolve the problem of the uninsured on their own.
Craig’s Comment: Disagree

individual States are unlikely to take the initiative in addressing the problem of the uninsured, even though solving that problem is in all States’ best interests. Congress’ intervention was needed to overcome this collective­ action impasse.
Craig’s Comment: Disagree

Congress enacted the ACA, a solution that retains a ro­ bust role for private insurers and state governments.
Craig’s Comment: Disagree

Per the minimum coverage provision, an individual must either obtain insurance or pay a toll constructed as a tax penalty.
Craig’s Comment: Disagree

According to one study conducted by the National Center for Health Statistics, the high cost of insurance is the most common reason why individuals lack coverage, followed by loss of one’s job, an employer’s unwillingness to offer insurance or an insurers’ unwillingness to cover those with preexisting medical conditions,
Craig’s Comment: Agree

By requiring most residents to obtain insurance, see Mass. Gen. Laws, ch. 111M, §2 (West 2011), the Commonwealth ensured that insurers would not be left with only the sick as customers. As a result, federal lawmakers observed, Massachusetts succeeded where other States had failed.
Craig’s Comment: Disagree

Under the Articles of Confederation, the Constitution’s precursor, the regulation of commerce was left to the States. This scheme proved unworkable, be­ cause the individual States, understandably focused on their own economic interests, often failed to take actions critical to the success of the Nation as a whole.
Craig’s Comment: Agree

The Framers’ solution was the Commerce Clause, which, as they perceived it, granted Congress the authority to enact economic legislation “in all Cases for the general Interests of the Union, and also in those Cases to which the States are separately incompetent.”
Craig’s Comment: Agree

Beyond dispute, Congress had a rational basis for concluding that the uninsured, as a class, substantially affect interstate commerce. Those without insurance consume billions of dollars of health-care products and services each year.
Craig’s Comment: Disagree

Congress also acted reasonably in requiring uninsured individuals, whether sick or healthy, either to obtain insurance or to pay the specified penalty.
Craig’s Comment: Disagree

THE CHIEF JUSTICE insists, the uninsured cannot be considered active in the market for health care, because “[t]he proximity and degree of connection between the [uninsured today] and [their] subsequent commercial activity is too lacking.” Ante, at 27. This argument has multiple flaws. First, more than 60% of those without insurance visit a hospital or doctor’s office each year. See supra, at 5. Nearly 90% will within five years.
Craig’s Comment: Disagree

Virtually everyone, I reiterate, consumes health care at some point in his or her life. See supra, at 3. Health insurance is a means of paying for this care, nothing more. In requiring individuals to obtain insurance, Congress is therefore not mandating the purchase of a discrete, unwanted product.
Craig’s Comment: Disagree

Under the current health-care system, healthy persons who lack insurance receive a benefit for which they do not pay: They are assured that, if they need it, emergency medical care will be available,
Craig’s Comment: Agree

Failing to learn from this history, THE CHIEF JUSTICE plows ahead with his formalistic distinction between those who are “active in commerce,” ante, at 20, and those who are not. It is not hard to show the difficulty courts (and Con­ gress) would encounter in distinguishing statutes that reg­ ulate “activity” from those that regulate “inactivity.”
Craig’s Comment: Disagree

THE CHIEF JUSTICE could certainly uphold the individual mandate without giving Congress carte blanche to enact any and all purchase mandates. As several times noted, the unique attributes of the health-care market render everyone active in that market and give rise to a significant free-riding problem that does not occur in other markets.
Craig’s Comment: Disagree

The failure to purchase vegetables in THE CHIEF JUSTICE’s hypothet­ ical, then, is not what leads to higher health-care costs for others; rather, it is the failure of individuals to maintain a healthy diet, and the resulting obesity, that creates the cost-shifting problem. See ante, at 22-23. Requiring individuals to purchase vegetables is thus several steps removed from solving the problem. The failure to obtain health insurance, by contrast, is the immediate cause of the cost-shifting Congress sought to address through the ACA.
Craig’s Comment: Disagree

As our national economy grows and changes, we have recognized, Congress must adapt to the changing “economic and financial realities.” See supra, at 14-15. Hindering Congress’ ability to do so is shortsighted;
Craig’s Comment: Disagree

Congress knew, however, that simply barring insurance companies from relying on an applicant’s medical history would not work in practice. Without the individual man­ date, Congress learned, guaranteed-issue and community­ rating requirements would trigger an adverse-selection death-spiral in the health-insurance market: Insurance premiums would skyrocket, the number of uninsured would increase, and insurance companies would exit the market.
Craig’s Comment: Disagree

The crisis created by the large number of U. S. residents who lack health insurance is one of national dimension that States are “separately incompe­ tent” to handle.
Craig’s Comment: Disagree

Far from tram­ pling on States’ sovereignty, the ACA attempts a federal solution for the very reason that the States, acting sepa­rately, cannot meet the need. Notably, the ACA serves the general welfare of the people of the United States while retaining a prominent role for the States.
Craig’s Comment: Disagree

Why should THE CHIEF JUSTICE strive so mightily to hem in Congress’ capacity to meet the new problems arising constantly in our ever­ developing modern economy?
Craig’s Comment: Disagree

The Federal Gov­ ernment, therefore, is not, as THE CHIEF JUSTICE charges, threatening States with the loss of “existing” funds from one spending program in order to induce them to opt into another program. Congress is simply requiring States to do what States have long been required to do to receive Medicaid funding: comply with the conditions Congress prescribes for participation.
Craig’s Comment: Disagree

any fair appraisal of Medicaid would require acknowledgment of the considerable autonomy States enjoy under the Act. Far from “conscript[ing] state agen­ cies into the national bureaucratic army,”
Craig’s Comment: Disagree

Medicaid “is designed to advance cooper­ ative federalism.”
Craig’s Comment: Disagree

Congress has broad authority to construct or adjust spending programs to meet its contemporary understand­ ing of “the general Welfare.”
Craig’s Comment: Disagree

JUSTICE SCALIA, JUSTICE KENNEDY, JUSTICE THOMAS, and JUSTICE ALITO, dissenting.

Congress has set out to remedy the problem that the best health care is beyond the reach of many Americans who cannot afford it. It can assuredly do that, by exercising the powers accorded to it under the Constitution. The question in this case, however, is whether the complex structures and provisions of the Patient Protection and Affordable Care Act (Affordable Care Act or ACA) go beyond those powers. We conclude that they do.
Craig’s Comment: Agree

What is absolutely clear, affirmed by the text of the 1789 Constitution, by the Tenth Amendment ratified in 1791, and by innumerable cases of ours in the 220 years since, is that there are structural limits upon federal power-upon what it can prescribe with respect to private conduct, and upon what it can impose upon the sovereign States. Whatever may be the conceptual limits upon the Commerce Clause and upon the power to tax and spend, they cannot be such as will enable the Federal Government to regulate all private conduct and to compel the States to function as administrators of federal programs. That clear principle carries the day here.
Craig’s Comment: Agree

To go beyond that, and to say the failure to grow wheat (which is not an economic activity, or any activity at all) nonetheless affects commerce and therefore can be federally regulated, is to make mere breathing in and out the basis for federal prescription and to extend federal power to virtually all human activity.
Craig’s Comment: Agree

That is fair and constitutional enough when the States freely agree to have their powers employed and their employees enlisted in the federal scheme. But it is a blatant violation of the constitutional structure when the States have no choice. The Act before us here exceeds federal power both in mandating the purchase of health insurance and in denying nonconsenting States all Medicaid funding.
Craig’s Comment: Agree

It is true that, at the end of the day, it is inevitable that each American will affect commerce and become a part of it, even if not by choice. But if every person comes within the Commerce Clause power of Congress to regulate by the simple reason that he will one day engage in commerce, the idea of a limited Government power is at an end.
Craig’s Comment: Agree

All of us consume food, and when we do so the Federal Government can prescribe what its quality must be and even how much we must pay. But the mere fact that we all consume food and are thus, sooner or later, participants in the “market” for food, does not empower the Government to say when and what we will buy. That is essentially what this Act seeks to do with respect to the purchase of health care.
Craig’s Comment: Agree

Commerce becomes everything. The dissent claims that we “fai[l] to explain why the individual mandate threatens our constitutional order.” Ante, at 35. But we have done so. It threatens that order because it gives such an expansive meaning to the Commerce Clause that all private conduct (including failure to act) becomes subject to federal control, effectively destroying the Constitution’s division of governmental powers.
Craig’s Comment: Agree

The dissent’s exposition of the wonderful things the Federal Government has achieved through exercise of its assigned powers, such as “the provision of old-age and survivors’ benefits” in the Social Security Act, ante, at 2, is quite beside the point. The issue here is whether the federal government can impose the Individual Mandate through the Commerce Clause.
Craig’s Comment: Agree

JUSTICE GINSBURG’S dissent comes treats the Constitution as though it is an enumeration of those problems that the Federal Government can address-among which, it finds, is “the Nation’s course in the economic and social welfare realm,” ibid., and more specifically “the problem of the uninsured,” ante, at 7. The Constitution is not that. It enumerates not federally soluble problems, but federally available powers.
Craig’s Comment: Agree

Article I contains no whatever-it-takes-to-solve-a-nationalproblem power.
Craig’s Comment: Agree

we have never held-never-that a penalty imposed for violation of the law was so trivial as to be in effect a tax. We have never held that any exaction imposed for violation of the law is an exercise of Congress’ taxing power-even when the statute calls it a tax, much less when (as here) the statute repeatedly calls it a penalty.
Craig’s Comment: Agree

So the question is, quite simply, whether the exaction here is imposed for violation of the law. It unquestionably is. The minimum-coverage provision is found in 26 U. S. C. §5000A, entitled “Requirement to maintain minimum essential coverage.” (Emphasis added.) It commands that every “applicable individual shall . . . ensure that the individual . . . is covered under minimum essential coverage.” Ibid. (emphasis added). And the immediately following provision states that, “[i]f . . . an applicable individual . . . fails to meet the requirement of subsection (a) . . . there is hereby imposed . . . a penalty.” §5000A(b) (emphasis added). And several of Congress’ legislative “findings” with regard to §5000A confirm that it sets forth a legal requirement and constitutes the assertion of regulatory power, not mere taxing power.
Craig’s Comment: Agree

In light of the ACA’s goal of near-universal coverage, petitioners argue, if Congress had thought that anything less than 100% state participation was a realistic possibility, Congress would have provided a backup scheme. But no such scheme is to be found anywhere in the more than 900 pages of the Act. This shows, they maintain, that Congress was certain that the ACA’s Medicaid offer was one that no State could refuse.
Craig’s Comment: Agree

Congress may not “simply commandeer the legislative processes of the States by directly compelling them to enact and enforce a federal regulatory program.” Id., at 161 (internal quotation marks and brackets omitted). Congress effectively engages in this impermissible compulsion when state participation in a federal spending program is coerced, so that the States’ choice whether to enact or administer a federal regulatory program is rendered illusory. Where all Congress has done is to “encourag[e] state regulation rather than compe[l] it, state governments remain responsive to the local electorate’s preferences; state officials remain accountable to the people. [But] where the Federal Government compels States to regulate, the accountability of both state and federal officials is diminished.
Craig’s Comment: Agree

When a heavy federal tax is levied to support a federal program that offers large grants to the States, States may, as a practical matter, be unable to refuse to participate in the federal program and to substitute a state alternative. Even if a State believes that the federal program is ineffective and inefficient, withdrawal would likely force the State to impose a huge tax increase on its residents, and this new state tax would come on top of the federal taxes already paid by residents to support subsidies to participating States.13 Acceptance of the Federal Government’s interpretation of the anticoercion rule would permit Congress to dictate policy in areas traditionally governed primarily at the state or local level.
Craig’s Comment: Agree

JUSTICE GINSBURG argues that “[a] State . . . has no claim on the money its residents pay in federal taxes.” Ante, at 59, n. 26. This is true as a formal matter. “When the United States Government taxes United States citizens, it taxes them ‘in their individual capacities’ as ‘the people of America’-not as residents of a particular State.” Ante, at 58, n. 26 (quoting U. S. Term Limits, Inc. v. Thornton, 514 U. S. 779, 839 (1995) (KENNEDY, J., concurring)). But unless JUSTICE GINSBURG thinks that there is no limit to the amount of money that can be squeezed out of taxpayers, heavy federal taxation diminishes the practical ability of States to collect their own taxes.
Craig’s Comment: Agree

In structuring the ACA, Congress unambiguously signaled its belief that every State would have no real choice but to go along with the Medicaid Expansion. If the anticoercion rule does not apply in this case, then there is no such rule.
Craig’s Comment: Agree

Congress assumed that every State would gratefully accept the federal funds (and conditions) to go with the expansion of Medicaid. This characterization of the ACA’s offer raises obvious questions. If that offer is “exceedingly generous,” as the Federal Government maintains, why have more than half the States brought this lawsuit, contending that the offer is coercive? And why did Congress find it necessary to threaten that any State refusing to accept this “exceedingly generous” gift would risk losing all Medicaid funds?
Craig’s Comment: Agree

after 2015, the States will have to pick up the tab for 50% of all administrative costs associated with implementing the new program,
Craig’s Comment: Agree

In sum, it is perfectly clear from the goal and structure of the ACA that the offer of the Medicaid Expansion was one that Congress understood no State could refuse. The Medicaid Expansion therefore exceeds Congress’ spending power and cannot be implemented.
Craig’s Comment: Agree

the Government’s remedy, now adopted by the Court, takes the ACA and this Nation in a new direction and charts a course for federalism that the Court, not the Congress, has chosen; but under the Constitution, that power and authority do not rest with this Court.
Craig’s Comment: Agree

When an unconstitutional provision is but a part of a more comprehensive statute, the question arises as to the validity of the remaining provisions.
Craig’s Comment: Agree

First, if the Court holds a statutory provision unconstitutional, it then determines whether the now truncated statute will operate in the manner Congress intended. If not, the remaining provisions must be invalidated.
Craig’s Comment: Agree

Second, even if the remaining provisions can operate as Congress designed them to operate, the Court must determine if Congress would have enacted them standing alone and without the unconstitutional portion.
Craig’s Comment: Agree
The whole design of the Act is to balance the costs and benefits affecting each set of regulated parties. Thus, individuals are required to obtain health insurance. See 26 U. S. C. §5000A(a). Insurance companies are required to sell them insurance regardless of patients’ pre-existing conditions and to comply with a host of other regulations. And the companies must pay new taxes. See §4980I (high-cost insurance plans); 42 U. S. C. §§300gg(a)(1), 300gg-4(b) (community rating); §§300gg-1, 300gg-3, 300gg-4(a) (guaranteed issue); §300gg-11 (elimination of coverage limits); §300gg-14(a) (dependent children up to age 26); ACA §§9010, 10905, 124 Stat. 865, 1017 (excise tax); Health Care and Education Reconciliation Act of 2010 (HCERA) §1401, 124 Stat. 1059 (excise tax). States are expected to expand Medicaid eligibility and to create regulated marketplaces called exchanges where individuals can purchase insurance.
Craig’s Comment: Agree

The Federal Government’s increased spending is offset by new taxes and cuts in other federal expenditures, including reductions in Medicare and in federal payments to hospitals. See, e.g., §1395ww(r) (Medicare cuts); ACA Title IX, Subtitle A, 124 Stat. 847 (“Revenue Offset Provisions”). Employers with at least 50 employees must either provide employees with adequate health benefits or pay a financial exaction if an employee who qualifies for federal subsidies purchases insurance through an exchange. See 26 U. S. C. §4980H (2006 ed., Supp. IV). In short, the Act attempts to achieve near-universal health insurance coverage by spreading its costs to individuals, insurers, governments, hospitals, and employers- while, at the same time, offsetting significant portions of those costs with new benefits to each group.
Craig’s Comment: Reference

The Act calls the Individual Mandate “an essential part” of federal regulation of health insurance and warns that “the absence of the requirement would undercut Federal regulation of the health insurance market.”
Craig’s Comment: Reference
The Act’s Major Provisions Major provisions of the Affordable Care Act-i.e., the insurance regulations and taxes, the reductions in federal reimbursements to hospitals and other Medicare spending reductions, the exchanges and their federal subsidies, and the employer responsibility assessment cannot remain once the Individual Mandate and Medicaid Expansion are invalid. That result follows from the undoubted inability of the other major provisions to operate as Congress intended without the Individual Mandate and Medicaid Expansion.
Craig’s Comment: Agree

Invalidating the key mechanisms for expanding insurance coverage, such as community rating and the Medicaid Expansion, without invalidating the reductions in Medicare and Medicaid, distorts the ACA’s design of “shared responsibility.”
Craig’s Comment: Agree

Like the effect of preserving the insurance regulations and taxes, the precise degree of risk to hospitals is unknowable. It is not the proper role of the Court, by severing part of a statute and allowing the rest to stand, to impose unknowable risks that Congress could neither measure nor predict.
Craig’s Comment: Agree

The ACA requires each State to establish a healthinsurance “exchange.” Each exchange is a one-stop marketplace for individuals and small businesses to compare community-rated health insurance and purchase the policy of their choice. The exchanges cannot operate in the manner Congress intended if the Individual Mandate, Medicaid Expansion, and insurance regulations cannot remain in force.
Craig’s Comment: Agree

Without the federal subsidies, individuals would lose the main incentive to purchase insurance inside the exchanges, and some insurers may be unwilling to offer insurance inside of exchanges. With fewer buyers and even fewer sellers, the exchanges would not operate as Congress intended and may not operate at all.
Craig’s Comment: Agree

Unlike the Individual Mandate, the employer-responsibility assessment does not require employers to provide an insurance option. Instead, it requires them to make a payment to the Federal Government if they do not offer insurance to employees and if insurance is bought on an exchange by an employee who qualifies for the exchange’s federal subsidies. See ibid. For two reasons, the employer-responsibility assessment must be invalidated. First, the ACA makes a direct link between the employer-responsibility assessment and the exchanges. The financial assessment against employers occurs only under certain conditions. One of them is the purchase of insurance by an employee on an exchange. With no exchanges, there are no purchases on the exchanges; and with no purchases on the exchanges, there is nothing to trigger the employer-responsibility assessment. Second, after the invalidation of burdens on individuals (the Individual Mandate), insurers (the insurance regulations and taxes), States (the Medicaid Expansion), the Federal Government (the federal subsidies for exchanges and for the Medicaid Expansion), and hospitals (the reductions in reimbursements), the preservation of the employerresponsibility assessment would upset the ACA’s design of “shared responsibility.” It would leave employers as the only parties bearing any significant responsibility. That was not the congressional intent.
Craig’s Comment: Agree
The Court today decides to save a statute Congress did not write. It rules that what the statute declares to be a requirement with a penalty is instead an option subject to a tax. And it changes the intentionally coercive sanction of a total cut-off of Medicaid funds to a supposedly noncoercive cut-off of only the incremental funds that the Act makes available. The Court regards its strained statutory interpretation as judicial modesty. It is not. It amounts instead to a vast judicial overreaching. It creates a debilitated, inoperable version of health-care regulation that Congress did not enact and the public does not expect. It makes enactment of sensible health-care regulation more difficult, since Congress cannot start afresh but must take as its point of departure a jumble of now senseless provisions, provisions that certain interests favored under the Court’s new design will struggle to retain. And it leaves the public and the States to expend vast sums of money on requirements that may or may not survive the necessary congressional revision. The Court’s disposition, invented and atextual as it is, does not even have the merit of avoiding constitutional difficulties. It creates them. The holding that the Individual Mandate is a tax raises a difficult constitutional question (what is a direct tax?) that the Court resolves with inadequate deliberation. And the judgment on the Medicaid Expansion issue ushers in new federalism concerns and places an unaccustomed strain upon the Union.
Craig’s Comment: Agree
The values that should have determined our course today are caution, minimalism, and the understanding that the Federal Government is one of limited powers. But the Court’s ruling undermines those values at every turn. In the name of restraint, it overreaches. In the name of constitutional avoidance, it creates new constitutional questions. In the name of cooperative federalism, it undermines state sovereignty. The Constitution, though it dates from the founding of the Republic, has powerful meaning and vital relevance to our own times. The constitutional protections that this case involves are protections of structure. Structural protections-notably, the restraints imposed by federalism and separation of powers-are less romantic and have less obvious a connection to personal freedom than the provisions of the Bill of Rights or the Civil War Amendments. Hence they tend to be undervalued or even forgotten by our citizens. It should be the responsibility of the Court to teach otherwise, to remind our people that the Framers considered structural protections of freedom the most important ones, for which reason they alone were embodied in the original Constitution and not left to later amendment. The fragmentation of power produced by the structure of our Government is central to liberty, and when we destroy it, we place liberty at peril. Today’s decision should have vindicated, should have taught, this truth; instead, our judgment today has disregarded it. For the reasons here stated, we would find the Act invalid in its entirety. We respectfully dissent.
Craig’s Comment: Agree

Full Opinion: http://www.scribd.com/doc/protected/98542388

This article originally appeared on the Obama White House Diaries website.

Photo Credit: Laura Padgett (Creative Commons)

Legalization of something does not necessarily make it a good idea. It was once legal to own a slave. Democrats who voted against abolishing slavery in 1864 have been doing their part ever since to enslave Americans to one social program or another. Obamacare is just the latest example.

For years, Americans have been abundantly blessed with a mostly free-market healthcare system in which competent physicians at state-of-the-art healthcare facilities deliver the latest medical care. Yes, that care comes at a cost, but the alternative, which Obamacare will certainly create, is rationing.

Now that the Supreme Court deemed Obamacare’s individual mandate for what it is — a tax, Democrats are attempting to redefine it as a penalty. It’s just their nature. Why call it a baby when you can reduce it to a fetus? Why bother worrying about illegal aliens when the term “undocumented workers” sounds so much more nebulous? I’ll go halfway; let’s call it a “penalty tax.”

Lies, lies, and more lies.

No tax increases on the middle class: Has anyone noticed Democrats are always talking about strengthening the middle class, and yet almost all of their legislation ends up hurting it? It’s the new “trickle down” theory. Take money from the top and sprinkle it over everyone else with no plan for growth. What you get is an increased lower class and a dwindling middle class. To make matters worse, Obama’s administration keeps redefining down the definition of middle class.

President Obama pledged (his word, not mine) “No family making less than $250,000 a year will see any form of tax increase.” The “Wall Street Journal”‘s senior writer Stephen Moore claims that almost 75 percent of Obamacare expenses will be funded by those making less than $120,000 annually.

Trying to get ahead by doing a little investing? Think again. Section 1411 of the law will levy a 3.8 percent “Medicare tax” on capital gains, dividends, rents, and royalties. The plan also penalizes “Cadillac” insurance plan holders by charging a whopping 40 percent excise tax — unless they are part of the White House’s chosen few who were given permission to opt out. Overall, Obamacare imposes 18 tax increases at a cost of $503 billion, mostly funded by the middle class and the elderly via Medicare cuts.

In other words, there are no freebies that aren’t paid for by the same middle class taxpayers Obama purports to defend. Odds are, many of you reading my column will be recipients of this broken promise.

Medicare will be protected: Well, not actually. Funding cuts of more than $500 billion, in addition to more than 150 new provisions, will affect quality care. Like any business, physicians cannot remain in practice when their profits don’t keep pace with costs to do business. Obamacare will bleed them dry. It may not happen overnight, but rest assured, it will happen, and when it does, the government will be right there to fill the gap with government-run facilities. Ask veterans and their families how that’s working out for them.

Medicare’s Patient-Doctor relationship will be preserved: Much like the U.K.’s National Health Service (NHS), Obamacare is more about cost control than quality care. The NHS determines medical needs based upon a calculation created by economists and uses it to determine who does or does not receive treatment. We’re not there yet, but Obamacare pushes us in that direction. Baby steps. And former Congressman Alan Grayson (D-FL) had the audacity to suggest the Republican vision for healthcare boils down to letting people die. Physician heal thyself!

Obamacare will not add to the deficit: Democrats’ pants should be on fire for this promise. Research done by experts at the Heritage Foundation reveals Obamacare is “a trillion-dollar budget buster” and claims Democrats rigged their numbers using “budget gimmicks, sleights of hand, accounting tricks, and completely implausible assumptions.”

One of the greatest things about America is that we have the opportunity to right our wrongs by way of the ballot box. What the Supreme Court declared as constitutional, voters can declare as history come November.

Susan Stamper Brown is an opinion page columnist, motivational speaker and military advocate who writes about politics, the military, the economy and culture. Email Susan at writestamper@gmail.com or her website at susanstamperbrown.com.

Photo credit: terrellaftermath

The Supreme Court has green-lighted an onslaught of government regulations, new taxes, and bureaucrats who will have a profound impact of the lives of millions of Americans. One of the first casualties, however, might be the millions of Americans with individual Health Savings Accounts (HSAs).

A little known regulation proposed by the Department of Health and Human Services (HHS) is threatening the growth of the HSA market and could result in the demise of the individual HSA market should it not be reversed.

HSAs are the free market alternative to government-run health care, and their popularity causes misery to proponents of ObamaCare. Nearly 13 million Americans have HSAs, making it the fastest growing health care product in history. Of the 13 million, five million are individuals who have purchased HSAs outside of large employers. HSAs work because they are consumer-driven and give leeway to consumers to choose their own doctor and treatment. Because HSA users can roll over money in their account at the end of the year, many become shoppers for health care, comparing prices and services. This creates a competitive market that lowers the price of health care.

Government bureaucrats in the Obama Administration are not fans of HSAs, to say the least. Many believe new regulations proposed by HHS are a scheme to limit or reverse the growth of the HSA marketplace.

Proposed HHS regulations called “Medical Loss Ratios” (MLR) discriminate against HSA-qualified health plans by not allowing medical costs incurred by the patient below the deductible to be accounted for in the MLR formula. These regulations could destroy the personal HSA market and undermine President Obama’s pledge to allow people who like their current health care plans to keep them.

Health Savings Accounts could be the first casualty in the government’s desire to run our health care system. It is critical for HSA supporters and account-holders to take notice and be counted. The time has come to act.

Photo credit: terrellaftermath