Health care hearings – what to listen for (Part 2)

The Supreme Court holds three days of hearings next week on the constitutionality of major parts of the new federal health care law, the Patient Protection and Affordable Care Act. Two days ago, the National Constitution Center’s Peter Jennings Project for Journalists and the Constitution presented a moot court on the constitutional issues surrounding the central feature of the Act – the mandate requiring virtually all Americans to obtain health insurance by the year 2014. Those “justices” voted 8-1 to uphold the mandate. Hear their opinions and watch the program in its entirety on Fora.tv.

If the Court ultimately strikes down that mandate, it may then turn to the question of whether any or all of the remainder of the new law can remain intact and functioning.   The Court will hold a hearing on that next Wednesday at 10 a.m., with the audiotape recording to be released within an hour or so after that hearing has concluded. It will be a 90-minute hearing. The description below will serve as a guide on what to expect in listening to that audiotape.

The Courtroom of the Supreme Court of the United States. (Franz Jantzen)

Few exercises in interpreting the Constitution are as bizarre as the one that the Supreme Court and lower courts go through if they strike down only a part of a multi-faceted law, and then decide what of the remainder can survive. It is bizarre because, in asking itself to decide the fate of the balance of such a law, a court actually is making a sophisticated guess of what Congress would have wanted if it could not have all of what it actually wrote into a law. It could ask Congress directly what it wanted, but it does not do that; it takes on the task itself, when Congress has not said in the body of a law what it wanted to happen if part were nullified.

But it is not an everyday exercise. It is supposed to be rare, because it draws a court quite close to the writing of a law, supposedly a task that the Constitution’s Article I gives to Congress alone. When it does occur, a court is supposed to nullify no more of a law than is absolutely necessary.

This process of selection of what to keep and what to cast aside, along with a constitutionally defective part of a law, is called “severability” analysis. In other words, if part of the law is nullified, can the rest be “severed” from it and kept on the statute books, still functioning.

The Supreme Court’s scheduled hearing next Wednesday morning will involve three lawyers, engaging the Court on what they think it should do, in the event it nullified the individual mandate. The argument will unfold as if the Court has chosen to pull the mandate out of the ACA, although it obviously won’t have done it by then.

Stepping up to the lectern directly in front of the nine Justices (and all nine of them will participate), the lawyer for the challengers to the mandate and other parts of the new law will tell the Court that the entire ACA is a package unto itself, with all of the parts interacting. That attorney may liken it to a fine watch, with the mainspring being the individual mandate: take that out, and nothing else works.

The lawyer probably will go over the law in some detail – if not too often interrupted by the Court – to show how he believes all of the parts depend upon each other. The new health care law, he is apt to say, has a demand side for health care insurance, and a supply side, and that both were meant to bring about near-universal health insurance.

The Justices are likely to interrupt that lawyer early and often, on just how the law is supposed to work, and on what evidence he has to show what Congress would prefer, knowing that the mandate was gone.

Responding, the lawyer may talk about how the leaders in Congress fashioned the new law along with major players in the health insurance and health care fields, and how so many lawmakers themselves said at the time that this had to be an all-or-nothing, comprehensive project to change the way the insurance market operates.

Along the way, incidentally, the lawyer may also seek to say again what was said in challenging the mandate itself, about how it supposedly coerces Americans into buying health insurance that many of them don’t want. The idea of that would be to keep that line of argument before the Court, since it won’t have to decided that question yet.

Some of the members of the Court, having read the U.S. government’s brief, may well press the challengers’ lawyer to say why the Court even needs to rule on the severability question (the government brief has made a complex argument why the Court, even if it strikes the mandate, need not go into the remainder of the law).

The lawyer would respond to those questions by saying that the government has it all wrong on that point. Explaining, that lawyer will say that the issue of “severing” parts of a law after a part was struck down is a search for a remedy for the constitutional violation, and not a fresh new challenge to the remaining parts of the law.

Justices are also likely to press that attorney on some specific parts of the law that remain, to see why they would have to fall with the mandate. Many parts of the law, it could be noted, already are being implemented and the Court could ask about what is to happen to those.

At a number of points in that lawyer’s argument, he is sure to make a point about judicial restraint: the best thing for the Court to do, out of respect for the constitutional separation of powers, is to nullify the entire ACA and then leave it to Congress to do what it wants with health care knowing that it could not have the mandate.

Next up to the lectern will be the federal government’s lawyer. The opening thrust of that attorney probably will focus on the argument that the Court need not confront the severability issue at all. That almost surely will draw a flurry of questions from the Justices, because that argument is strongly disputed not only by the challengers but also by the Court-appointed lawyer who has been selected by the Court to join in the argument to make the point that no part of the ACA need be sacrificed with the mandate.

Pressed on the point, the government lawyer may then feel a need to go ahead and discuss severability, and will no doubt stress that the Court should be very wary of striking down any more of the ACA than it absolutely must. Only that, the lawyer will be inclined to say, will confine the judicial task to the narrowest choice about what to keep and what to discard.

As the argument along those lines proceeds, the government attorney will seek to make a case that two parts of the ACA would not be able to function without the mandate: a requirement that insurance companies cover everyone, even those with pre-existing medical conditions, and the requirement that they do so without raising rates beyond affordable levels.

The Justices may well demand fuller explanations on those points, to test whether those two provisions are really central and whether they could actually be made to work even if the mandate were not in the law to bring in premiums from newly covered holders of health insurance policies.

There could be talk about something called the “death spiral.” This is an argument that, without the mandate bringing new premium revenue into the coffers of health insurance companies, the new coverage obligations the Act lays upon them will drive them toward financial collapse. There may be a discussion of how some states that experimented with broader coverage without a mandate to produce more insured people found that the experiment was a failure.

It might be that some will talk of the Massachusetts experiment, which did couple new health insurance obligations with an individual mandate, and it worked – as well as setting up a model that the ACA borrowed. The Massachusetts plan is associated with former governor Mitt Romney, but whether his name comes into the hearing is doubtful, since that might seem like a commentary on his current presidential campaign. The Court will be wary of seeming to be interested in the politics of health care.

Making the final argument, before the challengers’ lawyer gets up for a brief rebuttal, will be the Court-appointed lawyer specifically assigned to make one overall point: that the entire remainder of the ACA can remain on the books, and would be functional, even without the mandate.

Congress, that lawyer will say, would not have wanted to put everything back to square one even if it knew the mandate would not survive in the courts. Along the way, this attorney will allude to the rarity of the Court’s use of its severability powers to remake a federal law, and will urge special caution in doing it this time.

The members of the Court will no doubt seek from this lawyer a detailed explanation of how the surviving parts would function, without setting off the feared “death spiral.”
Once that hearing, and the others the Court is holding next week, have concluded, the Justices will meet in a private deliberation room at least once, cast preliminary votes, and get started on the task of drafting one or more opinions to resolve all of the issues – if they conclude that they have to decide everything brought to them in this historic case. A final ruling, or rulings, is not likely to emerge until late June.

Lyle Denniston is the National Constitution Center’s Adviser on Constitutional Literacy. He has reported on the Supreme Court for 54 years, currently covering it for SCOTUSblog, an online clearing house of information about the Supreme Court’s work.

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Health care hearings – what to listen for (Part 1 of 2)

Update: The Supreme Court holds three days of hearings next week on the constitutionality of major parts of the new federal health care law, the Patient Protection and Affordable Care Act. Last night the National Constitution Center’s Peter Jennings Project for Journalists and the Constitution presented a moot court on the constitutional issues surrounding the central feature of the Act – the mandate requiring virtually all Americans to obtain health insurance by the year 2014. Those “justices” voted 8-1 to uphold the mandate. Watch the program in its entirety on Fora.tv.

The description below will serve as a guide to that mock hearing, and also as a guide to the actual Supreme Court hearing on the mandate; the Court will release the audiotape of the hearing on the mandate next Tuesday afternoon, on its website. This Thursday, Constitution Daily will provide a second guide on what to expect when the Court, next Wednesday afternoon, releases the audiotape of its hearing on the impact on the Affordable Care Act as a whole, if the mandate were to be struck down.

As the new health care law has made its way through the federal courts, and as it has unfolded so far in the written legal filings by lawyers in the Supreme Court, two very clear but conflicting story lines may shape the constitutional fate of the individual mandate (technically called the “minimum coverage provision”) – the heart of the new Act.

The lawyer for the government will tell the Court that Congress, in choosing a series of “market reforms” of the nationwide health insurance industry, was doing what Congress has done many times before. That is, it has faced a national problem, affecting commerce that goes beyond individual state boundaries so individual states can’t solve it, and has worked out a national solution. The mandate, that lawyer will say, is a critical feature of that economic response. (See this recent story from Akhil Amar and Todd Brewster.)

The lawyer for the challengers will tell the Court that Congress is not really seeking to regulate commerce, but rather is seeking to create commerce – by forcing individuals who do not have health insurance, and do not want it, to go out into the marketplace and buy an economic product. Never before, that lawyer will say, has Congress done anything like that, and it has no constitutional authority to do it now. (For this perspective see Ilya Shapiro’s recent post.)

The lawyer for the government will argue first, because a federal appeals court struck down the mandate and the government is appealing that result. That attorney will assume that the Court is quite familiar with the facts about the mandate, but will go over how it works and why Congress chose it. The problem that Congress was facing was that some 50 million Americans do not have health insurance, but they someday will definitely need medical care, as everyone does, and so some means must be found to pay for that.

Americans, according to that lawyer, have for many years paid for such care by having insurance and they get it before they actually need it. That is all that Congress aimed to do in adopting the mandate.

But, the attorney will note that Congress had found that 50 million Americans don’t have health insurance, some because they were turned away, some because they can’t afford it, some because they prefer to pay out of their own pockets. But Congress wanted to be sure that, when all of the uninsured actually needed medical care, the cost of providing it did not have to be covered by the hospital or clinic or doctor, or by a rise in premiums to those who do have health insurance.

Congress, according to that lawyer, was aiming for nearly universal coverage at affordable rates, and it concluded that the only way to have both was to assure a sufficient number of customers for the health insurance industry that it can afford to write a policy for virtually all Americans. The mandate will bring in the customers, the lawyer will note.

Do not be surprised if the lawyer says something like “this is classic economic regulation of economic conduct.” A person without insurance is not really outside of the market for health care; they just don’t need it yet. Congress wanted to make sure they could pay when they do need it.

Because the government believes that a series of prior Supreme Court rulings interpreting the Constitution’s Commerce Clause support the new mandate, the government’s part of the hearing will feature mention of those precedents – especially Wickard v. Filburn in 1942 and Gonzales v. Raich in 2005. Neither one had anything to do with medical care or health insurance, but both gave Congress broad authority to regulate not only business that runs across state lines, but even local business that can have a significant impact on that wider commerce.

Reacting to the government lawyer, the members of the Court will question whether there is any precedent that even comes close to what was done with the mandate. Prompted by having read the challengers’ briefs, they will want to know whether Congress was just subsidizing the insurance industry to get it to go along with a new health law after years of resisting.

But, most of all, the Court’s members will want to know where the limiting point is. Some may actually say that, whatever they decide about the mandate, they have to think about what that will mean down the road, when a future Congress may try something else that is novel. They will be interested in what their precedents have said, and may actually disagree with the lesson the government lawyer draws from them.

If the lawyer tries to press a back-up argument that, even if the mandate is not justified under Congress’s power over commerce, it can still be upheld under its taxing power, that is likely to stir considerable skepticism from the bench.

The government lawyer will not use all of his time in his first turn, saving some to answer the other side’s argument.

When the challengers’ lawyer starts, he will turn very quickly to the claim that there is absolutely nothing in the Constitution – not the Commerce Clause, not the Necessary and Proper Clause, and not taxing power under the General Welfare Clause – that can justify such a deep intrusion by the national government into the lives of ordinary citizens. The perceived threat to individual liberty will be a very prominent theme.

But early in the argument, that lawyer also will take on the economic claims that the government lawyer has made, suggesting that the mandate will not work the way the government says it will, because the people who are the most frequent customers for medical care are not even covered by the mandate, or will get covered by some government program like Medicaid for the poor.

That lawyer will probably tell the Court that Congress was “conscripting” healthy people – particularly, young and healthy people – into becoming insurance customers in order to provide an economic benefit for the insurance companies and their present policyholders.

When the challengers’ attorney talks about the Supreme Court’s prior rulings, he will say that none of them authorized Congress to drum up business for a private industry. The farmer in the Filburn case and the grower of medical marijuana in the Raich case were already taking part in an economic market, and were not being dragged into it by Congress.

Along with the claims about the threat to individual liberty, that lawyer will say that the Constitution meant to leave it to the states to control health care policy, and that the Tenth Amendment was designed to keep Congress from acting as if it had a form of national “police power” to intrude on the states’ prerogatives.  Federalism – the division of power between national and state governments – itself was designed to protect individuals’ liberty, will be another likely point of emphasis.

On the future implications from any decision against the mandate, the challengers’ attorney probably will say that the Court need not disturb any other federal law because the mandate is such a novel approach that it can be nullified with no secondary effects.   The attorney will want to persuade the Court that what is revolutionary here is what Congress did, not what the Court would do to restore the constitutional balance.

The members of the Court will test that lawyer about whether the Court has the authority, when Congress has made an economic judgment, to second-guess the lawmakers. They may remind that attorney that economic regulation is judged by the most lenient constitutional test, so as not to infringe on Congress’s power over interstate commerce. Some on the bench may say that judges do not have the economic understanding to judge how to deliver health care or how to pay for it.

To the lawyer’s argument that states’ dignity and sovereignty will be deeply impaired by the mandate, some of the Court’s members probably will suggest that the Court has already crossed that bridge in prior precedents. They may even suggest that the challengers are trying to undo the entire field of jurisprudence over commercial regulation.

For both lawyers, most of the questions coming from the bench probably will be about Congress’s powers under the Commerce Clause, though some will explore the Necessary and Proper Clause, and at least a few questions may focus on the mandate as a form of tax.

(With the real Supreme Court, the decision on the mandate, and on the other issues it is considering, will not be announced until weeks from now, close to the end of the current term in late June. However, the “Justices” on the Jennings moot court will conference in the open and reach a decision at the conclusion of the program.)

Lyle Denniston is the National Constitution Center’s Adviser on Constitutional Literacy.  He has reported on the Supreme Court for 53 years, currently covering it for SCOTUSblog, an online clearing house of information about the Supreme Court’s work. Denniston will be live chatting during the Peter Jennings Project moot court webcast.

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