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Monday, December 13, 2010

Virginia Judge Declares Health Care Mandate Unconstitutional

A Judge in Virginia has held the health care mandate to be unconstitutional.  The decision is here and embedded below.

The Judge rejected the position of the government that the mandate was an exercise of taxing power:
It is clear from the text of Section 1501 that the underlying regulatory scheme was conceived as an exercise of Commerce Clause powers. This is supported by specific factual findings purporting to demonstrate the effect of the health care scheme on interstate commerce. In order for the noncompliance penalty component to survive constitutional challenge, it must serve to effectuate a valid exercise of an enumerated power-here the Commerce Clause. [at p. 36]
The Judge found that there was no legitimate Commerce Clause or General Welfare Clause justification for the mandate:

A thorough survey of pertinent constitutional case law has yielded no reported decisions from any federal appellate courts extending the Commerce Clause or General Welfare Clause to encompass regulation of a person's decision not to purchase a product, notwithstanding its effect on interstate commerce or role in a global regulatory scheme.

The unchecked expansion of congressional power to the limits suggested by the Minimum Essential Coverage Provision would invite unbridled exercise of federal police powers. At its core, this dispute is not simply about regulating the business of insurance-or crafting a scheme of universal health insurance coverage-it's about an individual's right to choose to participate. Article I, Section 8 of the Constitution confers upon Congress only discrete enumerated governmental powers. 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. See U.S. Canst. amend. X; Printz v. United States, 521 U.S. 898, 919, 117 S. Ct. 2365, 2376-77 (1997).  [at p. 37]
On careful review, this Court must conclude that Section 1501 of the Patient Protection and Affordable Care Act-specifically the Minimum Essential Coverage Provision-exceeds the constitutional boundaries of congressional power. [at p. 38]
The Judge also ruled that the Mandate could be severed from unrelated provisions of the law.  [at p. 40]The Judge declined, however, to issue an injunction, stating that there was no emergency since the mandate did not take effect until 2013 at the earliest.  [at pp. 41-42]


It is interesting how the politics of the mandate have come back to haunt the administration.  Because Obama did not want to be seen as raising taxes on people making under $250,000, during the debate and drafting the Democrats went out of their way to disavow the mandate as a tax, and to rely on the Commerce Clause.  After the mandate was challenged in court, the administration tried to backtrack and justify the mandate under the general taxing power.  But the Judge did not accept that flip-flop, ruling that the congressional record and text of the legislation prevailed.

As to why the Judge did not throw out the entire law, the Judge stated that there is a presumption of severability, and the congressional record was sufficiently muddled as to whether Congress would have passed the legislation without the mandate.  Interestingly, the Judge noted that the law was about more than healthcare and was rushed to a vote on Christmas eve (emphasis mine):
Having found a portion of the Act to be invalid, the Section 1501 requirement to maintain minimum essential health care coverage, the Court's next task is to determine whether this Section is severable from the balance of the enactment. Predictably, the Secretary counsels severability, and the Commonwealth urges wholesale invalidation.  The Commonwealth's position flows in part from the Secretary's frequent contention that Section 1501 is the linchpin of the entire health care regimen underlying the ACA.  However, the bill embraces far more than health care reform. It is laden with provisions and riders patently extraneous to health care-over 400 in all.... [at p. 38]
The final element of the analysis is difficult to apply in this case given the haste with which the final version of the 2,700 page bill was rushed to the floor for a Christmas Eve vote. It would be virtually impossible within the present record to determine whether Congress would have passed this bill, encompassing a wide variety of topics related and unrelated to heath care, without Section 1501. [at p. 39]
Cuccinelli v Sebelius - Memorandum Granting Motion for Summary Judgment 12-13-2010

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  1. You're having fun with the sanity this judge has [thankfully] brought to bear on the massive government power and control grab-fest (otherwise referred to as "Obamacare"), aren't you, Professor? Good for you! :)

  2. the severability is a real problem, too. over at patterico's i wrote a post with preliminary analysis. I suspect that if the mandate is struck down and enough of it remains, the insurance industries will literally go out of business.

    I can guarantee you that all the insurance companies are screaming today, probably at their congressmen.

  3. I think the insurance companies anticipated this and are working on alternatives to present to Congress as a sweetener to dump Obamacare.

    I think the judge was right--this was heard on motions for summary judgement and the other 400 provisions were not involved. The doctrine of severability does not allow the dumping of an entire law in the absence of a severability provision, just all those provisions intertwined with the provision which is struck down. And that is exactly what Judge Hudson has done.

  4. If severabiliy is implied, why is it that virtually every other bill has a severability clause? That would seem to argue against the implication would it not?

  5. cf

    so the law presumes that congress intended to bankrupt the insurance industry?

  6. Wait a minute, cf, are you saying that all of the actual health care provisions of the bill are struck down but all 400 earmarks and pork projects are not?

  7. Sad to say that the fate of all of this lies with a man named Kennedy.I,for one am not holding my breath.

  8. Some may think the ObamaCare proponents will appeal all the way up to the Supreme Court. The SC has to decide if the case has merit.

    In the meantime, Americans are going to figure out ways to take care of their business without the Democrat schemes to ruin our health care. If the insurance companies in existence are so incompetent as to allow, and even collude with, the Federal Government to ruin our health care system, we will punish them. That is how markets work.

    Call me a wishful thinker, but I am a man of action and already have a plan going forward to get people the health insurance they need based on a "secondary market" approach that brings costs down without government meddling. And it will make me rich.

  9. ... "there is a presumption of serverability" ... this will confuse all the computer geeks out here, Professor!

  10. @lgstarr - thanks for catching that, I'd hate to think we made access to a server a new constitutional right.

  11. I wonder, if Obamacare isn't stopped and the mandate is still around, if we could simply pay the fine and then get non-governmentally mandated insurance and not have to wait in the lines and deal with the life and death bureaucracy. It would probably be much more expensive, but I would think worth it to not be shackled to the whims of the government. It's no longer insurance if the government can override contracts and eliminate competition.

  12. Thank you for a clear and cogent post that shed light on the issue.

  13. A. Worthing and cf,
    I think there might be something to what cf is suggesting the insurers are doing: Several big insurers (UNH, Humana, Aetna, etc.) were up today in the market following the ruling, and the insurers that didn't see gains were only down slightly.

  14. THANK YOU FOR POSTING! We've been all over this on Common Cents...


  15. .

    Let me see if I understand.

    You, your blog, and the comment writers are:

    - for this activist judge legislating from the bench deciding to go against the will of the people (Congress).

    - for the huge international corporations making billions of dollars of profit by cheating them.

    - against regulations that protect the people.

    - against their own self personal interests.

    - against the peoples'governments of USA because all governments are bad, governments cannot do anything right, and governments are the enemy.

    Where in the world are ya'll living?

    Ema Nymton

  16. Professor if the mandate is held unconstitutional does Congress have the authority to destroy private health insurance? Would not the companies, the shareholders, debtors and creditors of those companies along with the employees have a Takings Clause case? Frankly the judge is too modest and refused to connect the dots. They whole thing is irretrievably tied to the mandate and none of the other parts work or can be financed without the mandate. Perhaps the FL judge will kick this rotten house of cards down completely.

  17. thankyou for the information

  18. Wow, that is an incredible breach of ethics, denying public health care initiatives. Is Obama sleeping? Somebody ought to wake him up! Thank you very much for your awesome commentary!

    The Glaring Facts