By Sergio Eduardo Muñoz, Senior Policy Analyst, Health Policy Project, Office of Research, Advocacy, and Legislation, National Council of La Raza. This post is part of an ACSblog online symposium on oral argument in HHS v. Florida.
Yesterday’s Day 2 Affordable Care Act (ACA) arguments at the Supreme Court involved the centerpiece of both health care reform and its legal challenges by examining whether the individual responsibility requirement to carry health insurance exceeds Congress’s powers under the Constitution. And unfortunately, it didn’t take long for it to become painfully clear that this question of enormous consequence may very well split down ideological lines. During his confirmation hearings, Chief Justice Roberts used the analogy that a federal judge is like an umpire, objectively calling balls and strikes under commonly accepted rules. If anything good came out of Tuesday’s acrimonious argument, maybe we can finally put that misleading visual to rest. The Justices’ sharp comments on the constitutionality of the responsibility requirement made clear that not only are the Court’s ideological wings calling these pitches differently, it’s not even clear they’re playing the same game.
Before describing today’s fireworks, however, some cold facts underlying today’s arguments and what the responsibility requirement does and does not do. If the responsibility requirement was in effect today, also referred to as the “individual mandate,” only 7% of the country under-65 would have to newly buy insurance or pay the tax penalty for non-compliance. Of those, over half would receive generous subsidies to assist in the purchase of insurance in newly-regulated markets. The vast majority of Americans would not have to decide how to satisfy the responsibility requirement because they already have insurance or would be exempt from purchase because of the economic strain. Take the Hispanic community, for example. Considering uninsured Latino children in comparison to other groups are disproportionately underenrolled in Medicaid and CHIP, despite the fact that Hispanics are about two times more likely than Whites to qualify for public health insurance, the odds are slim that this community would have to choose between new insurance and the assessment. This truth, unfortunately, has not been successfully communicated.
The responsibility requirement is indisputably a targeted new choice for a very small population. The problem, however, that this reform attempts to fix is huge.The nationwide rippling effects of these uninsured persons who will inevitably seek health care, in some cases expensive catastrophic health care, drive up health care and insurance premiums for us all. To solve this massive economic cost-shifting in a market that comprises one-fifth of the U.S. economy, Congress decided the solution was simple: expand the insurance risk pool.
Health insurance, like all insurance, bases its premium prices (and corresponding profit) on complicated calculations about how much of the covered service will actually be used. Because those with pre-existing, chronic, or otherwise serious conditions generally use more health care, these consumers are generally dissuaded from purchasing insurance or entering a given risk pool in the first place. It’s basic economics. It’s rational. What else is economically rational? The decision of the many relatively young and relatively healthy is to “self-insure.” That is, to roll the dice and decide they’d rather take the chance that they will never need expensive health care and accordingly not purchase health insurance. This rational decision, however, creates a feedback loop with the insurers’ choice to carefully screen their risk pool. The insurers are literally basing their premium prices on their calculations about the uninsureds' decision to go without coverage. Under the ACA, Congress eliminated these practices of both groups that were jointly leading to spiraling health care costs for all by crafting the responsibility requirement as a balancing solution. No longer can insurers rampantly discriminate against those with high health care costs, and in exchange, the unexempt uninsured will newly play or pay. That is, the uninsured will either obtain public or private health insurance or pay the cost of that health insurance premium under the tax penalty. That’s the responsibility requirement. Is it constitutional? Today’s arguments made it clear that there are three answers to that. Yes! No! And maybe.
From the start of the oral arguments, it was clear that the idea that perhaps two of the Court’s conservative members, Justice Scalia and Chief Justice Roberts, might adhere to the logic of prior decisions they had written or joined and uphold the mandate, probably underestimates how political this case has become. Along with the other conservative-leaning Justices, their sharp and skeptical rhetorical pummeling of the ACA’s defender, the Solicitor General, and his attempt to defend the responsibility requirement under either Congress’s constitutional powers to regulate interstate commerce or tax for the general welfare was relentless. Indeed, the main reason it became apparent that the liberal Justices of the Court likely thought the responsibility requirement was a constitutional exercise of one of those two powers was due to the fact that they spent most of their time bolstering the U.S. Government’s arguments.
These ideological divisions remained as the lawyers for the challengers to the ACA offered their arguments, but with two notable shifts. Justice Kennedy, who has assumed the role of the swing vote between the liberal and conservative blocs since the retirement of Justice O’Connor, seemed to suggest that perhaps the limiting principle for Congress’s powers to regulate problems such as the health care market, a constitutional cap that all of the Justices were searching for, was the very unique nature of the effect of the uninsured upon the health care market. An effect that is not present in other commercial industries, making the uniqueness of the health care market itself a limiting principle. Chief Justice Roberts as well seemed to think that health insurance was not as directly analogous to other industries, such as the automotive industry, a comparison that was repeatedly made by multiple lawyers and Justices. Even more intriguingly, Chief Justice Roberts seemed to highlight the inseparability of the fine from the responsibility requirement, hinting at the fact that perhaps the even clearer power of Congress under its taxing authority as opposed to its commerce powers was the easier sell. Make no mistake, though; these friendly comments were hardly saving graces. The Obama administration had a very tough day.
But ultimately, these are just tea leaves. The Justices have three months to ruminate further if they haven’t already made up their minds. When we look at the final decision in June, we may look back on these questions as just questions. However, a few things are certain. One, as was recognized by Justices Ginsburg and Breyer in their repeated references to Social Security and public health contagion responses, is that any decision striking down the responsibility requirement could raise serious questions about the constitutionality of other federal programs that have long protected the country’s most vulnerable and at-risk. Two, this is going to be a bitterly divided opinion. Three, the cliché that this Court has become Justice Kennedy’s is very true. Yet again, he will probably be the swing vote. So perhaps the wild card from today’s arguments, which definitely disillusioningly reaffirmed that this Court may be well on its way to delivering an ugly political opinion along the lines of Citizens United, is Chief Justice Roberts. Clearly, the question of whether the responsibility requirement is constitutional may break down on ideological lines as the four liberal Justices seem convinced it is, and at least three conservative Justices at this point have indicated they think it is not. If he wants to make sure that the ensuing decision isn’t starkly political, however, the Chief Justice better take his umpire duds out and start figuring out a way to avoid a 5-4 decision. Someone’s going to have to step up to the plate or this will result in a decision as deeply dividing as Bush v. Gore. But maybe that was inevitable.