Presentation on theme: "The Constitution At Work Session One: The Court and the Congress"— Presentation transcript:
1 The Constitution At Work Session One: The Court and the Congress Supreme Court Decisions That Affect Our LivesOLLI at Vanderbilt – Spring Term 2013
2 Structure of the Course Session One – Historical background; The Court as a Check on Congress and the Executive (the Affordable Health Care Act litigation). [Bob Covington] Session Two—Constitution and Family. [Mark Brandon, Professor of Law and Professor of Political Science] Session Three—Death Penalty Issues. [Susan Kay, Associate Dean for Clinical Legal Education]
3 Structure of the Course (cont.) Session Four – The First Amendment (Thomas R. McCoy, Professor of Law, Emeritus)Session Five – The First Amendment (David Hudson, Adjunct Professor of Law)Session Six – Discrimination (Bob Covington)
4 Quick 11th Grade American History Review: Events and Documents pre-1774 Committees of correspondenceFormed both at colony and town level, often by legislative action; at first had only a short-term existence, but from 1772 on many became permanent until superseded by state governments.Earliest: Probably Massachusetts in 1764Usual functions: Exchange information with other communities and colonies about steps being taken in response to various actions by the British parliament; slowly the range of authority grew until some constituted virtual “shadow governments.”
5 Quick History: Events and Documents pre-1774 Stamp Act Congress, 1765Met as response to New York and Massachusetts Bay resolutionsNine of 18 British North American colonies presentPetitions sent to King, House of Lords, House of Commons; not all delegates felt authorized to sign“Declaration of Rights” language:4th. That the people of these colonies are not, and cannot be represented in the House of Commons5th That the only representatives of these colonies are persons chosen therein, by themselves; and that no taxes can be constitutionally imposed on them but by their respective legislatures.
7 Colonial Transportation NO:Automobiles, cyclesRailroadsCanalsSteamshipsHotelsAVAILABLE:Roads, suitable for horse traffic, some for carriages and wagons; First stagecoach service began between Philadelphia and New York (three days)Rivers (flat-bottom “bateaus”)Inns/taverns
9 Colonial communication NO:Telephone, telegraph, et ceteraAVAILABLE:Postal service (smaller communities once a month; larger communities once a week or more, depending on how fast the “mailbag” filled.Newspapers (often more advertising, poetry, diatribe than news, but becoming more “newsy” over time); 37 at the time of Independence
10 B. Franklin’s Pennsylvania Gazette –an 1850 issue
12 Quick History: The “Continental Association” – October 20, 1774 September 1774: The first “Continental Congress” meets in Philadelphia; in October it adopts the provisions known as the “Continental Association.” These articles:(a) impose trade boycotts until Britain repeals a variety of laws; (b) call for action by each colony’s government to enforce such bans; (c) recognize the function of the “committee of correspondence” in each colony; and (d) assume the continued existence of the Continental Congress. Signers include future Presidents John Adams and George Washington and future Chief Justice John Jay.
13 Declaration of Independence -- 1776 One nation or many?“our Charters, our most valuable Laws, the Forms of our Governments, our Legislatures”“We, therefore, the Representatives of the united States of America, in general Congress, Assembled, Declare that these United Colonies are and of right ought to be Free and Independent States.”Includes protests against:Quartering of troopsSuspension of trial by juryAbolition of courts and refusal to apply “English law”
14 The Articles of Confederation (drafted 1777; fully effective 1881) Create a union of states, each of which “retains its sovereignty, freedom and independence and every power not expressly delegated” to the United States.Provide for a Congress to meet every November, each state to have from two to seven delegates and one vote.Limit the power of each state to negotiate treaties, declare war, or engage in military action, reserving these to the “United States in Congress assembled.”
15 Articles of Confederation (cont.) Create no executive branch as such, but a “president” of the Congress. With a one-year termProvide for two types of “courts” [Article IX]:“for the trial of piracies and felonies committed in the high seas” and “for receiving and determining finally appeals in all cases of captures”To determine boundary disputes (a sort of sub- committee of the Congress itself)Call for each state to give full faith and credit to the decisions of courts in other states
16 United States Constitution Drafted 1787; effective March 4,1789Structure:PreambleArticle I: The CongressArticle II: The ExecutiveArticle III: The JudiciaryArticle IV: “Full Faith and Credit” clause; citizens entitled to move about freely from one state to another; governance of Territories and admission of new StatesArticle V: Amendment proceduresArticle VI: The “supremacy clause”; recognition of existing debtsArticle VII: Ratification procedure
17 Constitutional Amendments: The Bill of Rights Amendments I-X: The “Bill of Rights” [First Congress][Effective December 1791]I: Freedom of assembly, petition, religion, speechII: Well-regulated militia; Right “to bear arms”III: No quartering of soldiers in private homesIV: Limits on search and seizure; warrantsV: No conviction save through due process of law; self-incrimination not required; government takings of property limited
18 Bill of Rights (cont.) Amendments (cont.) VI: Right to speedy trial; right to counselVII: Trial by jury preservedVIII: No “cruel or unusual” punishment; no “excessive” bailIX: “The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.”X: “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”
19 Later AmendmentsXI: Federal courts not empowered to hear suits brought against a State by citizens of another State or nation. XII: Electoral college to vote for President and Vice-President separately XIII: Slavery abolished XIV: No state to abridge the privileges and immunities of any “citizen of the United States”; no deprivation of life, liberty or property without “due process” of law; all persons entitled to “equal protection” 
20 Later Amendments (cont.) XV: Right to vote not to be denied on basis of race, color or prior status as slave XVI: Congress empowered to tax incomes XVII: Popular election of Senators XVIII: Prohibition of sale of alcoholic beverages XIX: Right to vote not to be denied on basis of gender XX: Fixes new dates for inauguration of Congress, President, Vice-president 
21 Later Amendments (cont.) XXI: Prohibition Amendment repealed XXII: President to serve no more than two terms XXIII: District of Columbia to participate in election of President XXIV: No poll tax XXV: Presidential succession; selection of Vice-president in case of vacancy XXVI: 18-year old vote XXVII: No change in salaries of sitting Congress [1951
22 The Supreme Court Created by Article III, Judiciary Act of 1789 Justices nominated by President (Article II, §2); Originally one Chief Justice, five Associate JusticesAfter varying from five to ten, the Court has consisted of nine Justices since 1869Each original Justice would “ride circuit” much of the year, coming together for four to six weeks each February and August (limited mandatory circuit participation continued until 1891)
23 The Current Court Chief Justice: Associate Justices: John G. Roberts, Jr. (appointed 2005)(b. 1955)Associate Justices:Antonin Scalia (1986)(b. 1936)Anthony M. Kennedy (1988)(b. 1936)Clarence Thomas (1991)(b. 1948)Ruth Bader Ginsburg (1993)(b. 1933)Stephen Breyer (1994)(b. 1938)Samuel Alito (2006)(b. 1950)Sonia Sotomayor (2009)(b. 1954)Elena Kagan (2010)(b. 1960)
24 The Court’s Workload Original jurisdiction Appellate jurisdiction “In all cases affecting Ambassadors, other public ministers and consuls and those in which a state shall be a party” [Article III, section 2]Typically, the Court appoints a special master to handle the actual development of the factual basis of these cases (such as boundary disputes), and [sometimes] recommend a resolutionAppellate jurisdiction“All other cases”AppealsGrants of writs of certiorari
25 The English “Common Law” Tradition “Courts find law; legislatures make law.”Stare decisis: the importance of precedentDifferentiating “holding” from “dictum”What makes a case different enough to refuse to apply earlier holdings?When is a court justified in overruling a prior case?Obvious cases: Constitutional amendments, statutes that require different outcomes [Dred Scott; XIIIth, IVth, XVth Amendments; ]Less obvious cases: changes in society [admission of women to the bar; Bradwell v. Illinois, 84 U.S (1873)]
26 The Court as Referee: Marbury v. Madison , 5 U.S. 137 (1803) Early days of American politics: the emerging party systemFederalist President John Adams loses to Democratic-Republican candidate Thomas Jefferson in the election of 1800.The “lame duck” Congress, with a Federalist majority, creates a number of judgeships and Adams appoints the persons to serve.The appointments become fully effective on delivery of a commission, that delivery being the duty of the Secretary of State.
27 Marbury v. Madison (cont.) William Marbury had not received his commission as a justice of the peace when Jefferson took office on March 5, 1801.Jefferson ordered his Secretary of State, James Madison, not to deliver the commission.Marbury sued, filing his action in the United States Supreme Court.Marbury sought a writ of mandamus, which would order Madison to deliver the commission.
28 Marbury v. Madison (cont.) A unanimous court ruled that it would not issue the requested writ, after analyzing three issues:First, was the failure to deliver the commission illegal? [Answer: Yes]Second, does the wrong done to Marbury justify a legal remedy? [Answer: Yes]Third, may this Court provide the writ of mandamus remedy? [Answer: No]The answer to the third issue flows from the Court’s reading of section 13 of the Judiciary Act of 1789 as compared to Article III, § 2, of the Constitution.
29 The “judicial review” rationale “It is emphatically the province and duty of the judicial department to say what the law is. Those who apply the rule to particular cases must of necessity expound and interpret that rule. If two laws conflict with each other, the courts must decide on the operation of each. So if a law be in opposition to the constitu- tion The court must decide that case conformably to the law, disregarding the constitution; or conformably to the constitu- tion, disregarding the law.”
30 The opinion author: Chief Justice John Marshall
31 John Marshall (b. September 24, 1755, d. July 6, 1835) Chief Justice, January 31, 1801-July 6, 1835Nominated by John AdamsFormer Secretary of State under Adams ( )Many major decisions concerning federal- state relationshipMcCulloch v. Maryland: States may not tax federal agenciesGibbons v. Ogden: Federal statute governing steamship licensing preempts state power to govern the same activity
32 Some common varieties of Constitutional argument The Congress has used a power too broadly (typical Article I, section 8 case).The Congress has violated a specific prohibition in the Constitution (typical Art. I, § 9 or First Amendment case).A state has acted on issues entrusted entirely to the national government. (Art. 1 § 10)A state has enacted laws inconsistent with Congressional action. (Art. VI, ¶ 2)A state has violated a specific Constitutional prohibition. (E.g., the XIVth Amendment Due Process clause.)
33 Two Centuries Later: National Federation of Independent Business v Two Centuries Later: National Federation of Independent Business v. Sebelius, 132 S.Ct (2012)A challenge to particular provisions of the Patient Protection and Affordable Care Act, enacted in 2010.The “mandate” that most adult individuals purchase health insurance coverage or pay a “shared responsibility payment” for failing to do soThe requirement that individual states expand their Medicaid programs or potentially lose some anticipated federal fundsThree cases, consolidated into one
34 The partiesNational Federation of Independent Business, alleging that its members will be adversely affected in a variety of ways by the “mandate” requirement and related provisionsTwenty-six states, protesting the impact of broadened Medicaid eligibilityIndividuals, protesting the “mandate” on various groundsLead defendant: Kathleen Sebelius, Secretary of Health and Human Services
35 The challenged statute Lengthy and complexTable of contents: 16 pages“Certified” text (with a bit of white space here and there) runs 2,409 pages; an ordinary print pagesTen broad divisions:Title I: Quality, Affordable Health Care for All AmericansTitle II: Role of Public ProgramsTitle III: Improving the Quality and Efficiency of Health CareTitle IV: Prevention of Chronic Disease and Improving Public Health
36 The statute (cont.) Title V: Health Care Workforce Title VI: Transparency and Program IntegrityTitle VII: Improving Access to Innovative Medical TherapiesTitle VIII: CLASS Act (Community Living Assistance Services and Support)Title IX: Revenue ProvisionsTitle X: Strengthening Quality, Affordable Health Care for All Americans
37 The statute (cont.) Overall approach highlights: Maintains many existing programs, particularly employment-based health insurance; no “single payer” although Medicaid grows in significanceAdds a “new” player in the form of health insurance “exchanges”– probably often internet-basedIncreases the proportion of Americans covered by health insurance, both private and publicRequires a high proportion of health insurance premiums to be used for actual provision of health care services, by limiting administrative costs (including salaries, dividends) to 15 or 20 per cent (depending on nature of insurer)
38 The statute: Emphasis on expanding coverage Why such a central focus:Those not coveredOften untreated until a condition is both serious and expensive to treatUsually lack a primary care physician and so are likely to use an emergency room for care, at relatively higher costOften are unable to pay for treatment, so that the cost of their treatment is shared in some way between those providing care and other patients who use the same care providers
39 Expanding coverage (cont.) Reasons why many are not insuredThe “adverse selection” problem – those who choose no coverage are often those likely to need care only in exceptional cases (e.g. accidents)The “cherry picking” and “inside limits” problems – individuals with pre-existing conditions unable to get meaningful coverage at affordable ratesVery low income thresholds for Medicaid eligibilityThe statute’s solutionsEliminate cherry picking and inside limitsRequire almost all adults to obtain insuranceRequire states to use a different income threshold
40 The complex language of the statute: The “mandate” provision: 26 U. S The complex language of the statute: The “mandate” provision: 26 U.S.C. § 5000A(a) Requirement to maintain minimum essential coverageAn applicable individual shall for each month beginning after 2013 ensure that the individual, and any dependent of the individual who is an applicable individual, is covered under minimum essential coverage for such month.
41 “Mandate” language (cont.) (b) Shared responsibility payment(1) In generalIf a taxpayer who is an applicable individual. . . fails to meet the requirement of subsection (a) for 1 or more months, then, except as provided in subsection (e), there is hereby imposed on the taxpayer a penalty with respect to such failures in the amount determined under subsection (c)(2) Inclusion with returnAny penalty imposed by this section with respect to any month shall be included with a taxpayer’s return under chapter 1 for the taxable year which includes such month.
42 “Mandate” language (cont.) (d) Applicable individualFor purposes of this section—(1) In generalThe term “applicable individual” means, with respect to any month, an individual other than an individual described in paragraph (2), (3), or (4).(2) Religious exemptions . . .Religious conscience exemptionHealth care sharing ministry(3) Individuals not lawfully present . . .(4) Incarcerated individuals
43 “Mandate” language (cont.) (e) Exemptions(1) Individuals who cannot afford coverage . . .(2) Taxpayers with income below filing threshold . .(3) Members of Indian tribes . . .(4) Months during short coverage gaps . . .(5) Hardships
44 Medicaid coverage expansion provision, 42 U.S.C. § 1396(a)(10)(VIII) ContentsA State plan for medical assistance must— . . .(10) provide— (A) for making medical assistance available to—(i) all individuals— . . .(VIII) beginning January 1, 2014, who are under 65 years of age, not pregnant, not entitled to, or enrolled for, benefits under [other provisions of this statute] and whose income (as determined under subsection (e)(14)) does not exceed 133 percent of the poverty line (as defined in section 1397jj(c)(5) of this title) applicable to a family of the size involved
45 Medicaid expansion language (cont.) 42 U.S.C. § 1397jj(c)(5): The term “poverty line” has the meaning given such term in section 9902(2) of this title42 U.S.C. § 9902(2) The term “poverty line” means the official poverty line defined by the Office of Management and Budget The Secretary shall revise annually the poverty line
46 Huh?From the Federal Register, January 20, 2011: “Due to confusing legislative language dating back to 1972, the poverty guidelines have sometimes been mistakenly referred to as the OMB guidelines In fact, the OMB has never issued the guidelines; the guidelines are issued each year by the Department of Health and Human Services Under the authority of 42 U.S.C. § 9902(2).”
47 2012 Poverty Guidelines Persons in household Poverty guideline $11,170,130,090,050,010,970,930,890For households with more than 8 persons, add $3,960 for each
48 Briefs and ArgumentsIn addition to the original petition for a writ of certiorari (request that the Court hear the case), eighteen briefs submittedOral argument held on three successive days, March 26, March 27, March 28 in 2012
49 The OpinionsChief Justice Roberts, joined in part by Justices Ginsburg, Breyer, Sotomayor, and Kagan (59 pages)Justice Ginsburg, joined by Justice Sotomayor, and joined in part by Justices Breyer and Kagan (61 pages)Justice Scalia, joined by Justices Kennedy, Thomas, and Alito (65 pages)Justice Thomas (2 pages)
50 Five Issues before the Court Does the Anti-Injunction Act apply?Is the Medicaid Expansion justified under the “spending power” granted the Congress?Is the “mandate” that individuals purchase health insurance within the power of Congress under the “commerce clause”?In enacting the “mandate” did the Congress act within its powers under the “taxing” authority granted by the Constitution?If the Court strikes down either or both, does the statute as a whole fail?
51 First Issue: The Anti-Injunction Act Internal Revenue Code [26 U.S.C.] § 7421(a):“Except as provided in [sections not relevant here], no suit for the purposes of restraining the assessment or collection of any tax shall be maintained in any court by any person ”In other words: Pay first, then sue to get it backStrictly a statutory interpretation question; the Constitution is not directly involved
52 The Anti-Injunction Act (cont.) Since this suit seeks to prevent the Affordable Care Act from ever taking effect, if the mandate penalty is a “tax” for the purposes of the Anti-Injunction Act, the Court would dismiss the suit.HELD: (All Nine Justices): The Anti-Injunction Act does not apply.Five Justices (Roberts opinion) reason that if the Congress wished this to be a tax for Anti-Injunction Act purposes, the word “tax” would have been used.The four “dissenters” reason this penalty is not a tax at all.
53 The Constitutional Issues: The Empowering Language of Article I Article I, section 8The Congress shall have Power To 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 ;To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes; AndTo make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.
54 Second Issue: The Medicaid Expansion The Constitutional language: The “spending clause” of Article I, section 8: “to pay the debts and provide for the general welfare”The precedents: “cooperative federalism” cases, particularly Steward Machine Co. v. Davis (unemployment insurance) and South Dakota v. Dole (21-year old drinking age)
55 Factual background: Medicaid expansion -- Eligibility Existing program eligibilityAffordable Care Act eligibilityPregnant womenChildrenNeedy families[States vary with respect to income level required. On average: unemployed parents with income below 37% of poverty threshold; employed parents with income below 63% of poverty threshold]BlindPersons over 65 years of ageDisabledAll legally present persons with income below 133% of poverty threshold
56 Medicaid expansion: Carrot and Stick The carrot:In years , the federal government will cover 100% of the cost of the expansion; the percentage then decreases gradually to 90% of the additional cost.The stick:42 U.S.C. §1396c: “If the Secretary finds that the [State’s Medicaid] plan no longer complies with the provisions of this title, the Secretary shall notify such State agency that further payments will not be made to the State (or, in his discretion, the payments will be limited to categories under the State plan not affected by such failure ) ”
57 The Precedents: Steward Machine Co. v. Davis, 301 U.S. 548 (1937) The Unemployment Insurance part of the Social Security Act imposed a payroll tax on all employers, but gave a “credit” to employers in those states that enacted unemployment insurance schemes that met certain federal standards; those states would also receive some federal monetary assistance to administer their statutes.A closely divided Court (5-4) upheld the statute as not an improper invasion of the power of the individual states.
58 Language from the Steward Machine Co. Majority Opinion For the statute to be unconstitutional under the Xth Amendment there must be a showing “that the tax and the credit in combination are weapons of coercion, destroying or impairing the autonomy of the states.”“We do not say that a tax is valid, when imposed by act of Congress, if it is laid upon the condition that a state may escape its operation through the adoption of a statute unrelated in subject-matter to activities fairly within the scope of national policy and power.”
59 The Precedents: South Dakota v. Dole, 483 U.S. 203 (1987) Under the challenged statute, federal highway aid funds otherwise payable to a state would be reduced if that state failed to enact a statute making 21 the legal age limit for the purchase and consumption of alcohol.Upheld 7-2 (Justice Scalia joined majority)Dissents by Justices Brennan, O’Connor, stress that the XXIst Amendment entrusts regulation of sale and consumption of alcohol to the states.
60 South Dakota v. Dole: Majority opinion language “The spending power is not unlimited, but is instead subject to several general restrictions The first of these limitations is derived from the language of the Constitution itself: the exercise of the spending power must be in pursuit of “the general welfare.” In considering whether a particular expenditure is intended to serve general public purposes, courts should defer substantially to the judgment of Congress. Second, we have required that if Congress desires to condition the States' receipt of federal funds, it “must do so unambiguously ” Third, conditions on federal grants might be illegitimate if they are unrelated “to the federal interest in particular national projects or programs.” Finally, we have noted that other constitutional provisions may provide an independent bar to the conditional grant of federal funds.”
61 The problems opinion writers face For supporters of the statute:Beginning with Steward Machine Co., several opinions have said that someday a given scheme might be “coercive” and therefore unconstitutional. The “stick” provision is problematic.For opponents of the statute:No prior case has actually struck down a spending power “cooperative federalism” statute as “coercive” or an undue interference with a state’s authority.Applying the language of South Dakota v. Dole, this statute arguably meets all the four “tests.”
62 Medicaid Expansion: The rulings Seven Justices find that the Medicaid Expansion is coercive, because of the “threat” that current Medicaid support might be taken away from individual states.Of these, three find that only the provision permitting the Secretary (of HHS) to take away all or part of existing Medicaid funding need be struck.Four would say that that provision is so integral to the whole scheme of the statute that the entire expansion plan must be struck.Two Justices argue that both the “carrot” and the “stick” provisions are proper, since future federal funds are not owed, only anticipated.
63 Medcaid Expansion: Net result -- and a challenge for the future Since there are only four votes for overturning the voluntary participation (“carrot”) provisions of the ACA, those survive, unless the statute as a whole fails.A significant problem, highlighted in the dissenting opinion of Justice Ginsburg, is created for federal courts in the future: Where is the “coercion” dividing line to be set?
64 The “line drawing” challenge: A classic statement Justice Potter Stewart“I shall not today attempt further to define the kinds of material I understand to embraced within that shorthand description [‘hard core pornography’]; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it and the motion picture involved in this case is not that.” (concurring opinion in Jacobellis v. Ohio, 378 U.S. 184 at 197 (1964))
65 The “Line drawing problem” illustrated: Medicaid Health Care Expenditures, 2010 Total Medicaid expenditures, Fiscal Year 2010, United States:$ 389,084,333,952Federal funds: $ 263,376,784,409State funds: $ 125,707,549,543Tennessee, Fiscal Year 2010Federal funds: $ 6,406,407,017State funds: $ 2,111,707,010Total $ 8,518,114,027Source: Kaiser Family Foundation, State Health Facts
66 The “line drawing” challenge --The Highway cases Tennessee Budget , Department of TransportationState Revenue Federal Revenue TotalSources Sources(recurring)$885,625,000 $860,318,000 $1,788,707,000[Mass transit: $142,119,000; Air & Rail $85,000,000]A 5% loss of highway funds, thus somewhere between $30,000,000 and $40,000,000
67 The “line drawing” challenge: What about, say, Education? Tennessee Budget,K-12 (general)State funds (excluding Lottery) $3,707,630,600Federal funds $1,484,904,300The next case:Assume: The Congress were to impose a new condition for the receipt of federal funding for K-12 education: The curriculum for all public schools and all approved home schooling texts must include (a) the teaching of geological dating techniques and Darwinian-based evolutionary theories, and (b) the use of safe sex techniques. Failing to do this would result in a discretionary loss of some percentage of federal funds: What of: 5%; 25%? 50%? 75%?
68 Issues Three and Four: The “Mandate” The textual arguments for its constitutionality are based on:Congressional power to “regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes; ”Congressional power to “lay and collect Taxes, Duties, Imposts and Excises ”Congressional power to “make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.”
69 Issue Three: The “mandate” and the “commerce clause”: Justice Scalia et al. 18th century dictionaries indicate that “regulate” does not include the power to require that an individual undertake to engage in commerce, when that individual has not taken any action of that sort [e.g., Johnson, A Dictionary of the English Language (7th ed. 1785): “to adjust, to direct according to rule”]Prior cases demonstrate reluctance to allow Congress to order states into action, much less individuals, even when dealing with serious problems. [New York v. United States, 505 U.S (1992): States may not be required to take title to nuclear waste.]
70 Issue Three: The four-Justice opinion (cont.) The mandate covers not just those who failed to purchase insurance but then obtained health care services, but also those who both failed to obtain insurance and never entered the health care market at all.Thus the mandate is over broad, since it seeks to require individuals to engage in activity when they have an individual right not to do so.The “necessary and proper” clause does not call for a different outcome. The basic scheme is too far removed from “regulation.” Moreover, less intrusive schemes were available to the Congress.
71 Issue Three: The Chief Justice on the “mandate” and the “commerce clause” “Congress has never attempted to rely on that power to compel individuals not engaged in commerce to purchase an unwanted product. Legislative novelty is not necessarily fatal; there is a first time for everything. But sometimes “the most telling indication of [a] severe constitutional problem ... is the lack of historical precedent” for Congress's action.”“Every day individuals do not do an infinite number of things. In some cases they decide not to do something; in others they simply fail to do it. 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.”
72 Issue Three: The opinion of Justice Ginsburg et al Issue Three: The opinion of Justice Ginsburg et al. on the “commerce clause”The opinions of the Chief Justice and of Justice Scalia take the wrong perspective. The Congress is entitled to view the health insurance marketplace as a whole, not simply as an adding together of individual transactions.
73 The four in dissent on the “commerce clause” issue (Ginsburg opinion) The health care market place problems the Congress addressed in this statute are broad societal problems, and the Congress is entitled to legislate broadly to address them.The reading of the commerce clause by the Chief Justice and the other four is a throw- back to views now generally discarded (citing pre-1936 cases and contrasting them with decisions since then), and this approach unduly limits the Congress’s ability to deal adequately with such problems.
74 Issue Three: The Ginsburg opinion reasoning (cont.) Those without insurance affect the cost of health care:In 2008, uninsured persons were recipients of $116 billion in health care; they were able to pay only $73 billion. Health care providers pass along the bulk of this cost to “those who pay reliably: the government and private insurers.” Those insurers therefore raise their premiums. “The net result: Those with health insurance subsidize the medical care of those without.”Individual states are unlikely to be able to restore balance on their own (citing the Massachusetts experience, where “emergency rooms served thousands of uninsured out-of-state residents.”)
75 Issue Three: The Ginsburg opinion reasoning (cont.) It is not sensible to treat those who fail to purchase insurance as non-participants in the health care market.“First, more than 50% of those without insurance visit a hospital or doctor’s office each year Nearly 90% will within five years. An uninsured’s consumption of health care is thus quite proximate. It is virtually certain to occur in the next five years and more likely than not to occur this year.”In addition, there is no sensible way to identify those uninsureds who will not be consumers of health care in the near future.
76 Issue Three: the Ginsburg opinion conclusion on the “mandate” and “commerce clause” Therefore, given that –The health care market is clearly “commerce.”The uninsured are a major force in that market.Which uninsured persons are most likely to be near-term consumers of health care is an unknown –Does it not make sense to treat the “individual mandate” as a justified exercise of the commerce power?Moreover, government does require citizens to act (e.g., serve as jurors).
77 Issue Four: Is the “mandate” penalty a proper use of the “taxing” power? The Constitutional Text: Article I, § 8:The Congress shall have Power To lay and collect Taxes, Duties, Imposts and ExcisesThe statute (26 U.S.C. § 5000A)(a) Requirement to maintain minimum essential coverageAn applicable individual shall for each month beginning after 2013 ensure that the individual, and any dependent of the individual who is an applicable individual, is covered under minimum essential coverage for such month.
78 The statute (continued)(26 U.S.C. § 5000A) (b) Shared responsibility payment(1) In generalIf a taxpayer who is an applicable individual. . . fails to meet the requirement of subsection (a) for 1 or more months, then, except as provided in subsection (e), there is hereby imposed on the taxpayer a penalty with respect to such failures in the amount determined under subsection (c)(2) Inclusion with returnAny penalty imposed by this section with respect to any month shall be included with a taxpayer’s return under chapter 1 for the taxable year which includes such month.
79 Issue Four: OutcomeIs the “shared responsibility payment” or “penalty” a “tax” authorized by Article I, section 8?Chief Justice Roberts and Justices Ginsburg, Breyer, Sotomayor and Kagan say “yes.”Justices Scalia, Kennedy, Thomas and Alito say “no.”
80 Issue four: The five-Justice view The “shared responsibility payment” or “penalty” looks like a tax (the “duck” test):Filed and paid with tax returnProvides significant revenue to the governmentThe amount to be paid is determined by reference to “tax-like” factors – taxable income, number of dependents, joint or single filing statusThe label of “penalty” is not determinativeEarlier cases have upheld “license fees” and “surcharges” as valid under the taxing power, and have struck down “taxes” that were in effect fines (for violations of child labor laws, for example).
81 Issue four: The four dissenters’ view There is a “clear line” between “tax” and “penalty”; quoting an earlier case: A “tax is an enforced contribution to provide for the support of government; a penalty is an exaction imposed by statute as punishment for an unlawful act.”This is clearly a penalty from the way the Congress structured the exaction. Buying coverage is labeled “requirement”; moreover some are exempt from the “tax” who are not exempt from the mandate.
82 What is the “mandate penalty”? The Roberts/Ginsburg view FineTax
83 What is the “mandate penalty”? The Dissenters’ View Tax
84 Issue five: Can the rest of the ACA survive if portion(s) have been held unconstitutional? (Severability)The 5-Justice majority, in Chief Justice Roberts’ opinion:The determinative “question here is whether Congress would have wanted the rest of the Act to stand, had it known that States would have a genuine choice whether to participate in the new Medicaid expansion We are confident that Congress would have wanted to preserve the rest of the Act.” (citing the inclusion of a “saving” clause)
85 Issue five: The four dissenters’ view on severability The four in dissent confront a different problem, since they would invalidate both the Medicaid expansion (entirely, both the voluntary “carrot” provisions and the power of the Secretary to withhold funds for “traditional” Medicaid) and also the individual mandate. With both of those coverage expansion provisions gone, the dissenters argue that much of the rest of the statute makes no sense, and the entire statute must fall.
86 Summing up Issue One (Anti-Injunction Act) Roberts+Ginsburg+Breyer+Sotomayor+KaganIt’s up to the Congress to pick what exactions are subject to the ActScalia+Kennedy+Thomas+AlitoThe exaction here is by its nature not a tax.
87 Summing up (cont.) Issue Two (Medicaid expansion) Roberts+Breyer+Kagan Accepting all prior “cooperative federalism” majorities as precedent, the “stick” provision here is coercive on the states and must failScalia+Kennedy+Thomas+AlitoThe “stick” provision is coercive, and some earlier cases may not have been decided properlyGinsburg+SotomayorBecause funding of Medicaid is year-at-a-time, the “stick” provision is only an inducement, not coercion, and the post-1936 precedents call for this to be a proper use of the spending power
88 Summing up (cont.)Issue Three: Constitutionality of the “mandate” as an exercise of the power to regulate commerceRoberts+Scalia+Kennedy+Thomas+AlitoRequiring an individual to initiate a commercial transaction goes beyond the regulation of commerce and is beyond Congressional authorityGinsburg+Breyer+Sotomayor+KaganCongress took a sensible view of how the health care market actually operates and of its problems with the uninsured. Given that impact, a requirement that taxpayers purchase insurance is a reasonable exercise of the commerce power.
89 Summing up (cont.)Issue four: Constitutionality of the “mandate” as an exercise of the taxing powerRoberts+Ginsburg+Breyer+Sotomayor+KaganSince the “shared responsibility payment” or “penalty” looks like a tax in many ways, and is an important potential revenue source, this exaction of money is constitutional.Scalia+Kennedy+Thomas+Alito“Penalty” and “tax” are two different categories, and this looks much more like the former.
90 Summing up (cont.)Issue Five: Can the rest of the statute survive the excision of what is not constitutional?Robert+Ginsburg+Breyer+Sotomayor+KaganSince only the “stick” portion of the Medicaid expansion fails, and there is likelihood many states will expand anyhow, given the “carrot,” it seems clear Congress would want the rest of the statute to survive.Scalia+Kennedy+Thomas+AlitoSince the mandate as well as the Medicaid expansion should be held unconstitutional, too little of the statute would remain to allow it to go forward without further Congressional action.
91 A memory aid for the exam Think of poker – but with different winnersTwo pair[Justices Ginsburg+Sotomayor][Justices Breyer+Kagan]Four of a kind[Justices Scalia+Kennedy+Thomas+Alito]Ace high[Chief Justice Roberts]
92 Does the decision matter? National political question:If the statute had been struck down would the present Administration and Congress be able to rebuild a national health care program from scratch?State political questions:Create exchanges?Expand Medicaid?
93 What’s happening: Medicaid Expansion post-NFIB v. Sebelius As of February 22, 2013:23 states and the District of Columbia have said they will accept funds and expand their programs13 states have announced they will not participate in the expansion14 states have not yet made a formal decisionThe choice to opt in or out remains available until the start of 2014; legislatures may still go along with or reverse governors’ decisions in some states.Source: The Guardian
94 What’s happening: Implementing the “mandate” Friday, February 1, 2013: The Internal Revenue Service issues its proposed regulations for implementing the “minimum essential coverage” and “shared responsibility payment” provisions of the statute [78 Federal Register pp ]
95 What’s happening: Setting standards for health insurance February 20, 2013: The Department of Health and Human Services issued a “final rule” defining “essential health benefits” to be provided by health plans, and setting up procedures for updating those standards.[78 Federal Register pp ]. The regulations appear as 45 Code of Federal Regulations, parts 147, 155, 156.
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