The basic question of the lawsuits filed by 14 states (to-date) is does the current law violate federalism, that is does it violate the constitutional division between the federal government and state government powers?
This question must be answered in a few parts. First, as long as a federal law applies to powers given to the federal government within the constitution, the federal law will always trump state law; this is outlined in the Supremacy Clause of the constitution (Article VI, Clause 2). So the question becomes does the content of this law fall within the jurisdiction of the federal government? This is where the debate lies.
Supporters of the law argue that under the Commerce Clause (Article I, Section 8, Clause 3) the federal government is allowed to regulate activities of interstate commerce or activities that are likely to significantly impact interstate commerce. The broadening of the commerce clause to include activities that themselves are not directly interstate commerce but will significantly impact interstate commerce came primarily out of cases brought in the New Deal, WWII era and represented a significant expansion of federal regulatory power.
Supporters argue that healthcare has a large impact on interstate commerce allowing broad federal power in regulating the healthcare industry. Even most opponents agree there is likely room for the federal government to regulate aspects of healthcare under the Commerce Clause but focus the question more narrowly to the constitutionality of requiring individuals to carry health insurance.
The implementation of this requirement will, in many cases, require individuals to purchase insurance from private companies. Opponents argue this positive mandate is a broad, unprecedented expansion of power under the Commerce Clause. While it has been widely upheld that once an individual actively chooses to engage in commercial activity, the federal government can then regulate that activity (regulation of firearms purchases, safety standards on cars, etc), it is not clear that the government can compel passive individuals to engage in commerce (requiring the purchase of private healthcare insurance).
The response of supporters to the above argument is that the so-called personal mandate does not truly fall under the Commerce Clause and instead should be interpreted under the Taxing and Spending Clause (Article I, Section 8, Clause 1) which gives the federal government power to levy taxes to support the defense and general welfare of the country. Supporters argue that the personal mandate is actually not a mandate but a legal tax that incentivizes behavior that supports the general welfare of the country.
In summary, it is widely thought the most viable constitutional question is does the personal requirement to carry health insurance amount to an inappropriate expansion of federal power that violates the Commerce Clause or is it a reasonable form of taxation to support the general welfare as outlined in the Taxing and Spending Clause?
There are other legal issues that have been raised including whether the Medicaid expansion represents a violation of the 10th amendment’s prohibition on requiring states to enforce federal law. These other challenges, however, at this point are not thought to be major threats to the law’s constitutionality.
So what do I think? I believe to have a viable healthcare system, it is important to expand the insurance risk pool as broadly as possible. Expanding the insurance risk pool requires significant motivation for most, if not all, citizens to continuously carry insurance (via a public or private plan or health organization). A mandate or automatic enrollment (with appropriate cost controls and support) is likely the only way to achieve high enough rates of insurance participation to appropriately share risk.
At the same time, I understand and empathize with concerns about government requiring individuals who have made no active forays into commerce to purchase products from private, often for profit, companies. In my opinion, this is another example where a public option could have made sense. A public option, open to all Americans, could have offered a third way. Car insurance is an example of a generally well-accepted government (albeit state government) mandate to purchase a private product. Again, it is not totally analogous because one has a choice not to drive and therefore not to carry car insurance. But in a nation, where there is an implicit if not explicit expectation of expensive healthcare, I am not sure that the analogy is so far off. I am not sure there is a way to opt out of healthcare in the same way one can opt out of driving.
Finally, I do support taxation as a means of incentivizing behavior despite its clear convolution of our tax system which may reduce returns and therefore services overall and its risk of misincentivizing behavior as seen in the recent housing bubble. I view levying a tax to incentive the carriage of health insurance as a theoretically good step. Now let’s hope that 1) the regulation of the insurance market and the steps to cost reduction are sufficient to provide fair, affordable insurance options for individuals to choose from and 2) the tax is high enough to incentivize broad health insurance coverage. Those are big hopes!
Links to short further readings:
http://roomfordebate.blogs.nytimes.com/2010/03/28/is-the-health-care-law-unconstitutional/
http://www.ajc.com/opinion/pro-con-is-the-416692.html
I am working on a longer post examining the passed healthcare reform law. Watch for that soon.
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