Health Care Reform: The Real Winner is The Court

(No, we are not tooting our own horn.)

The Supreme Court of the United States’ decision on health care reform last Thursday is surely one of the most important decisions of the century. President Obama, who proposed the law amidst a firestorm of controversy in 2010, seemed cautiously victorious. Despite quashing the individual mandate provision in place of a taxation provision, the Court seemed to grant Congress a victory too. And, of course, those tens of millions of uninsured Americans across the country can applaud the final outcome of the case.

But the biggest victory of all seems to go to the Court itself. In its usual fashion, the decision came down to a 5-4 split, but with one surprise that no one could predict: Chief Justice Roberts, who was appointed by President George W. Bush as a beacon of Conservative values, voted in favour of upholding Obama’s Patient Protection and Affordable Care Act. Symbolically, Chief Justice Roberts wrote the majority decision, becoming the unifying force behind which his colleagues Justices Ginsburg, Sotomayor, Kagan and Breyer stood.

In many ways, then, this decision is a testament to the Court’s fundamental role: as a non-partisan branch of government, keeping the executive and legislative branches in check. After such polarizing decisions as Bush v. Gore, 531 U.S. 98 (2000), which essentially decided a presidential election, and Citizens United v. Federal Election Commission, 558 U.S. 50 (2010), which opened the door for unlimited corporate and union political fundraising, many Americans, including President Obama himself, became highly critical of the Court’s seeming partisanship. On Thursday, the SCOTUS began to restore our confidence. If the Affordable Care Act decision, which marked the end of the Court’s term, could serve as any gauge for the next term, then some of us can breathe a sigh of relief; the Court will be tackling even more controversial issues, such as affirmative action in higher education and same-sex rights, when it reconvenes.

Two Provisions Under Attack

Before launching into a critical discussion of the SCOTUS, it would be helpful to break down the decision. President Obama’s health care reform came in the form of the Patient Protection and Affordable Care Act (“Affordable Care Act”), which was enacted by Congress in 2010. The case that brought the piece of legislation to court is actually called National Federation of Independent Business v. Sebelius, 567 U.S. __ (2012). There are two key provisions of the Affordable Care Act that came under the careful scrutiny of the Supreme Court: (1) the individual mandate; and (2) Medicaid expansion. The individual mandate is essentially the backbone of the impugned legislation. It would require most Americans to maintain “minimum essential” health insurance coverage (26 U.S.C. §5000A). Practically, the universalization of healthcare would be economically unsustainable if too few people signed up. For those who are not exempt, and for those who do not receive health insurance through an employer, the individual mandate would compel them to purchase insurance from a private company. Beginning in 2014, those who defy the mandate would make a “[s]hared responsibility payment” to the Federal Government (§5000A (b)(1)) — like a penalty paid to the Internal Revenue Service along with the individual’s taxes.

The second provision under attack was the expansion of Medicaid. The current Medicaid program is a federally funded program that offers funding to States to assist certain groups: pregnant women, children, needy families, the blind, the elderly, and the disabled in obtaining medical care (42 U. S. C. §1396(a)). The Affordable Care Act proposed to expand the Medicaid program, expending coverage to all adults with incomes up to 133% of the federal poverty level. The Act increases federal funding to cover the States’ costs in expanding Medicaid coverage (§1396d(y)(1)). But, if a State refuses to comply with the Act’s new coverage requirements, it may lose all of its federal Medicaid funds (§1396(c)).

The Decision

If you did not get your news from CNN or Fox on Thursday morning, then you would be aware of the fact that the Affordable Care Act was largely upheld by the Court. While Chief Justice Roberts, writing for the majority, concluded that the individual mandate was not a valid exercise of Congress’s power, as stipulated by the Commerce Clause and the Necessary and Proper Clause (pp. 16-30), the individual mandate can be construed as imposing a tax on those who do not have health insurance. As a tax, the individual mandate could stand.

To begin, Chief Justice Roberts stated that the Constitution grants Congress the power to “regulate Commerce” (Art. 1, §8, cl. 3) [emphasis added], which presupposes the existence of commercial activity to be regulated. The individual mandate does not regulate existing commercial activity, but rather compels individuals to become active in commerce by purchasing a product. So, the individual mandate cannot be sustained under Congress’s power to “regulate Commerce” (pp. 16-27). Furthermore, the individual mandate cannot be sustained under the Necessary and Proper Clause either. In earlier cases where the Necessary and Proper Clause was at issue, such as McCulloch v. Maryland, 17 U.S. 316 (1819), the focus has been on exercises of authority derivative of, and in service to, a granted power. This cannot be said of the individual mandate of the Affordable Care Act: “The individual mandate, by contrast, vests Congress with the extraordinary ability to create the necessary predicate to the exercise of an enumerated power and draw within its regulatory scope those who would otherwise be outside of it” (p. 3).

Then, with a certain legal creativity and deftness, Chief Justice Roberts saved the individual mandate. It could be in the form of a tax, which Congress has the authority to impose on Americans without infringing the Constitution. Quite simply, Congress may “lay and collect Taxes” (Art. 1, §8, cl. 1). A potential problem arises from the fact that the legislation was not drafted in this way. In fact, it uses the language of a “penalty,” which could have been fatal to its constitutionality, according to Chief Justice Roberts. The majority, however, found a way to rescue it. The Court followed a functional approach. Citing United States v. Constantine, 296 U.S. 287 (1935) (pp. 33-35), the Court would, “[d]isregard the designation of the exaction, and view its substance and application.” Basically, the Chief Justice sidestepped the problematic language of the individual mandate by delving into its “substance” and “application.” It is like a tax because, should Americans opt out, they must pay a tax to the IRS, which would be similar to paying a penalty in practice. So, the individual mandate could stand as a tax for the majority of judges on the bench.

Where the Affordable Care Act needs to be curtailed is the Medicaid expansion program. Specifically, Chief Justice Roberts, along with Justices Kagan and Breyer, consider the provision that withholds Medicaid funds to States that fail to comply with the expansion to be unconstitutional. Again, the Supreme Court begins their analysis by examining statute law. The Spending Clause grants Congress the power to “pay the Debts and provide for… the general Welfare of the United States” (Art. 1, §8, cl. 1). Based on caselaw, the Chief Justice interpreted it to mean that Congress may use this power to establish cooperative state-federal Spending Clause programs (pp. 45-51). The Medicaid expansion program would be coercive, as opposed to cooperative, as States would lose funds if they did not comply. For Chief Justice Roberts, it would be contrary to federalism for the federal government to pressure the States to accept a Spending Clause program, or else lose all funding. (Later, the Chief Justice would use the metaphor of pointing a gun at someone’s head to illustrate this point.)

(With the Medicaid expansion program as an option, not a requirement, for States, as a result of the decision, questions now arise as to how many states will actually exercise the option to opt out and not improve access to healthcare for the poor, elderly and sick.)

In a predicable manner, four justices dissented. Justices Scalia, Kennedy, Thomas and Alito adamantly opposed to the Affordable Care Act. Justice Ginsburg, joined by Justice Sotomayor, dissented in part, disagreeing with the Chief Justice that the Spending Clause does not preclude the Secretary from withholding Medicaid funds based on a State’s refusal to comply with the expanded Medicaid program.

Roberts’ Version

As noted earlier, some legal commentators have celebrated Chief Justice Roberts’ crafty legal maneuvers to save the individual mandate in this decision. Others have applauded him for being deeply practical. Right=wing groups tend to label him a traitor for upholding President Obama’s healthcare initiative. For Chief Justice Roberts, however, his decision arose from neither craftiness nor practicality. It was simply his job. At his confirmation hearing in 2005, Chief Justice Roberts famously compared his job to that of a baseball umpire – not a batter. He would call the shot, not take the shot himself. It is clear in the decision that the Chief Justice did not like the Affordable Care Act, looking pretty downcast when he made the announcement Thursday morning. According to CBS News, he switched his vote in the last minute. But it was not his job to dismiss the Affordable Care Act because he personally disliked it.

He had to weigh his decision seriously. Another great judge, Justice Oliver Wendell Holmes, once stated that assessing a piece of legislation passed by Congress “is the gravest and most delicate duty that this court is called on to perform,” Blodgett v. Holden, 275 U.S. 142 (1927) (p. 275). This principle came into play later in the Chief Justice’s decision when it became increasingly clear that he himself did not find the tax argument terribly plausible. He ultimately pressed for the tax because it was good enough to save the Affordable Care Act. Again, he cited Justice Oliver Wendell Holmes: “As between two possible interpretations of a statute, by one of which it would be unconstitutional and by the other valid… Our plain duty is to adopt that which will save the act” (p. 37). Chief Justice Roberts recognized the gravity of the piece of legislation: it was drafted and passed by democratically elected representatives. For that reason, Chief Justice Roberts remained very cautious of judicial activism in this decision.

This was signaled from the very beginning. After setting out the issues before the Court, the Chief Justice out the task of the Court:  “Resolving this controversy requires us to examine both the limits of the Government’s power, and our own limited role in policing these boundaries” [emphasis added] (p. 2). During his confirmation hearings seven years ago, he explained he would limit his role on the Court by deferring significantly to the elected branches of government. “All judges are acutely aware of the fact that millions and millions of people have voted for you and not one has voted for us,” he responded to a Senator at the hearing, so “you have the responsibility of representing the policy preferences of the people.” Representing the policy preferences of the people is not the same as protecting them from themselves. Later in his decision, Chief Justice Roberts spells it out:  “It is not our job to protect the people from the consequences of their political choices.” Even though it is clear that Chief Justice Roberts does, in fact, think this is a bad political choice, it is not his job to save us from it.

The Legacy of the Roberts Court

We should not confuse the Chief Justice’s opinion in this case with a statement about his politics. He is not a left-wing judge. He will likely continue to vote with the conservative members – namely, Justices Thomas, Scalia, Kennedy and Alito. But, with this health care reform decision, we begin to discern a Chief Justice, a decisive leader on the Supreme Court.

As the legal commentator, Adam Liptak, points out, Chief Justice Roberts regards himself as the custodian of the Supreme Court’s prestige, authority and legitimacy. And, in this case, he was very much its custodian. He did not become marred in the bitter ideological dispute that usually takes place among the members of the bench. Being the swing vote in this landmark case, Chief Justice Roberts saved the Court from being attacked for engaging in personally-motivated judicial activism from other branches of government. Here, we should be reminded of President Obama’s State of the Union address in January 2010; turning to face the members of the bench, he ripped into the Supreme Court for allowing unlimited campaign advertising by corporation and unions. At the centre of this furor is the 5-4 decision in Citizens United, where the Supreme Court decided along ideological lines, prompting the President to wonder out loud if it was really good law. (Justice Samuel Alito, famous for his steely demeanor, looked livid, mouthing “not true” at one point.)

This is the kind of public debacle that Chief Justice Roberts tried to avoid. For the people of America and for the other branches of government to have confidence in the judiciary, the Court must rise above partisan politics and be the guardian of the Constitution. This is the direction that the Chief Justice appears to be leading the Court. Only having served seven years, and being only fifty-seven years old, the legacy of the Roberts court remains to be seen. In the Affordable Care Act decision, the Chief Justice will hopefully be remembered for trying to unify the Court, and for reminding us that it is not the place of the Court to write, or re-write, policy.