Sixth Circuit Upholds Individual Mandate In ACA As Constitutional

Opinion here (PDF). The vote was 2-1. I discuss the dissent on the flip.

First, the court ruled that the individual mandate regulates economic activity:

The minimum coverage provision regulates activity that is decidedly economic. In Raich, the Supreme Court explained that “‘[e]conomics’ refers to ‘the production, distribution, and consumption of commodities.’” Id. at 25 (quoting Webster’s Third New International Dictionary 720 (1966)). Consumption of health care falls squarely within Raich’s definition of economics, and virtually every individual in this country consumes these services. Individuals must finance the cost of health care by purchasing an insurance policy or by self-insuring, cognizant of the backstop of free services required by law. By requiring individuals to maintain a certain level of coverage, the minimum coverage provision regulates the financing of health care services, and specifically the practice of self-insuring for the cost of care. The activity of foregoing health insurance and attempting to cover the cost of health care needs by self-insuring is no less economic than the activity of purchasing an insurance plan. Thus, the financing of health care services, and specifically the practice of self-insuring, is economic activity.

More on the flip.

Moreover, the Necessary and Proper Clause provides Congress with the authority to act even if the individual mandate did not reach economic activity, rules the court:

Alternatively, even if self-insuring for the cost of health care were not economic activity with a substantial effect on interstate commerce, Congress could still properly regulate the practice because the failure to do so would undercut its regulation of the larger interstate markets in health care delivery and health insurance. In Raich, the Supreme Court explained that Congress can regulate non-commercial intrastate activity if it concludes that it is necessary in order to regulate a largerinterstate market. 545 U.S. at 18. The Court found relevant that unlike the single-subject criminal statutes at issue in Morrison and Lopez, the classification of marijuana at issue in Raich was “merely one of many ‘essential part[s] of a larger regulation of economic activity, in which the regulatory scheme could be undercut unless the intrastate activity were regulated.’” Id. at 24-25 (alteration in original) (quoting Lopez, 514 U.S. at 561). The Raich Court highlighted two aspects of Congress’s broad power under the Commerce Clause. First, Congress may aggregate the effects of non-commercial activity and assess the overall effect on the interstate market. Id. at 22. Second, the rational basis test applies to Congress’s judgment that regulating intrastate non-economic activity is essential to its broader regulatory scheme. Id. at 19. Thus, where Congress comprehensively regulates interstate economic activity, it may regulate non-economic intrastate activity if it rationally believes that, in the aggregate, the failure to do so would undermine the effectiveness of the overlying regulatory scheme.5

On the issue of whether the Congress can regulate "inactivity":

As long as Congress does not exceed the established limits of its Commerce Power, there is no constitutional impediment to enacting legislation that could be characterized as regulating inactivity. The Supreme Court has never directly addressed whether Congress may use its Commerce Clause power to regulate inactivity, and it has not defined activity or inactivity in this context. However, it has eschewed defining the scope of the Commerce Power by reference to flexible labels, and it consistently stresses that Congress’s authority to legislate under this grant of power is informed by “broad principles of economic practicality.” Lopez, 514 U.S. at 571 (Kennedy, J., concurring); see Wickard, 317 U.S. at 120 (explaining that Congress’s power cannot be determined “by reference to any formula which would give controlling force to nomenclature such as ‘production’ and ‘indirect’ and foreclose consideration of the actual effects of the activity in question upon interstate commerce”).

The dissent says the individual mandate exceeds the Commerce Power:

Because the mandate regulates decisions not to purchase health insurance – conduct falling outside the ordinary sense of the word “commerce” (the trade or exchange of a good, see Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1, 72 (1824)) – Congress expressly invoked the third category of Commerce Clause power as its authority for enacting the mandate. See ACA § 1501(a)(1). And in various suits across the nation challenging the constitutionality of the mandate, the government has consistently defended the mandate under Congress’s power to regulate activities that substantially affect interstate commerce.

Here is the dissent's malarkey on the Necessary and Proper Clause:

This argument deftly switches the focus from the private, non-commercial nature of plaintiffs’ conduct (the decision to be uninsured) to the perceived economic effects of their absence from the insurance market. Certainly, plaintiffs’ conduct may be considered in the aggregate with the conduct of similarly-situated individuals, see Raich, 545 U.S. at 20; however, the Commerce Clause cannot be satisfied when economic activity is lacking in the first instance.2 “Where economic activity substantially affects interstate commerce, legislation regulating that activity will be sustained.” Lopez, 514 U.S. at 560; see also Morrison, 529 U.S. at 611 (“[I]n those cases where we have sustained federal regulation of intrastate activity based upon the activity’s substantial effects on interstate commerce, the activity in question has been some sort of economic endeavor.”); Raich, 545 U.S. at 17 (Congress may regulate “purely local activities that are part of an economic ‘class of activities’ that have a substantial effect on interstate commerce”). It is true that decisions not to purchase insurance are in some sense economic ones. They are choices about risk and finances. When viewed in the aggregate, these decisions have economic consequences. Congress, for instance, has found that: The cost of providing uncompensated care to the uninsured was $43,000,000,000 in 2008. To pay for this cost, health care providers pass on the cost to private insurers, which pass on the cost to families. This cost-shifting increases family premiums by on average over $1,000 a year. By significantly reducing the number of the uninsured, the requirement, together with the other provisions of this Act, will lower health insurance premiums. 42 U.S.C. § 18091(F). In an amicus brief, certain economic scholars point to other costshifting effects caused by decisions to be uninsured. The first relates to adverse selection, or the positive correlation between demand for insurance and the risk of loss. When healthy individuals opt not to buy insurance, the pool of insured persons is smaller and less healthy as a whole, thus raising premiums. Second, when previously uninsured individuals do obtain insurance, they tend to do so when they have a significant medical need and thereby consume more and costlier services.

That pretty much should end the discussion - a substantial effect on commerce. Buuut noooooo. . . :

Lopez and Morrison rejected a view of causation whereby the cost-shifting to society caused by violent conduct can satisfy the substantial effects test. See Lopez, 514 U.S. at 564 (rejecting the government’s “costs of crime” and loss of “national productivity” reasoning); Morrison, 529 U.S. at 615 (same). The government fails to show why a view of cost-shifting caused by risky conduct should fare any better. The problem with the government’s line of reasoning here is that it has no logical end point, and it illustrates precisely Justice Thomas’s concerns with the substantial effects test. See Morrison, 529 U.S. at 627 (Thomas, J., concurring) (calling the test “rootless and malleable”). That test, when paired with the aggregation principle, invites manipulation and “draw[ing] the circle broadly enough to cover an activity that, when taken in isolation, would not have substantial effects on commerce.” Lopez, 514 U.S. at 600 (Thomas, J., concurring)

For those who do not know, Justice Thomas concurred with the majority in Lopez, because he disagreed with its maintenance of the "substantial effects" test. The substantial effects test remains good law. The dissenting judge is blatantly flaunting a binding Supreme Court rule.

In essence, the dissenting judge does not care about binding precedent:

The “hard work for courts” is identifying “objective markers for confining the analysis in Commerce Clause cases.” Raich, 545 U.S. at 47 (O’Connor, J., dissenting). When dealing with the outer limits of Congress’s powers, “first principles” must be heeded. See Lopez, 514 U.S. at 552. The federal government is one of enumerated powers. Congress’s authority must have limits, lest the Tenth Amendment’s reservation of powers to the States and the people be without meaning. Principles of federalism thus should guide a court’s examination of novel exercises of Commerce Clause power.

(Emphasis supplied.) Yes, Justice O'Connor was in dissent in RaIch. I suppose I could go on, I see no point to it. When a circuit court judge decides that binding Supreme Court precedent is immaterial to his analysis, there's not much to say about the opinion.

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  • Display: Sort:
    This will go to the SC, (5.00 / 1) (#3)
    by jeffinalabama on Wed Jun 29, 2011 at 11:43:10 AM EST
    and I can't decide what I think will happen there.

    I'd bet that they will uphold it. (5.00 / 1) (#4)
    by inclusiveheart on Wed Jun 29, 2011 at 11:46:34 AM EST
    It mandates that people pay private corporations, after all.

    Benefits the insurance and medical (none / 0) (#18)
    by MO Blue on Wed Jun 29, 2011 at 05:11:18 PM EST
    industries. IMO it is a slam dunk that the SC will rule in favor of the corporate interests.

    Anyone else getting the wrong ... (5.00 / 2) (#12)
    by Robot Porter on Wed Jun 29, 2011 at 01:39:05 PM EST
    background color here?

    yep, me too (none / 0) (#22)
    by sj on Wed Jun 29, 2011 at 06:43:26 PM EST
    Fixed. (none / 0) (#2)
    by Big Tent Democrat on Wed Jun 29, 2011 at 11:39:21 AM EST

    Looks like the lead opinion (Martin) (none / 0) (#5)
    by Peter G on Wed Jun 29, 2011 at 11:55:00 AM EST
    commands only two votes on the Commerce Clause/ Necessary & Proper rationale, and Judge Sutton (a Bush II appointee, and a conservative intellectual) then joins in the result on the basis of the Taxing Power rationale (so it's unanimous on that aspect).

    no, wait ... (none / 0) (#6)
    by Peter G on Wed Jun 29, 2011 at 12:02:56 PM EST
    Judge Graham seems to disagree with Martin on Commerce Clause.  If Sutton isn't joining that aspect, then the "lead" opinion is not a majority opinion on the Commerce Clause/Necessary & Proper rationale, and would not be the "opinion of the court."  BTD - how do you count the votes?

    2-1 (none / 0) (#7)
    by Big Tent Democrat on Wed Jun 29, 2011 at 12:11:05 PM EST
    on the Commerce Clause.

    0-2, with no opinion from the lead on the taxing power.


    I see the two votes to sustain the ACA (none / 0) (#8)
    by Peter G on Wed Jun 29, 2011 at 12:42:12 PM EST
    on Commerce Clause grounds, but as I read it, there is no majority opinion on that issue.  Sutton does not joint Martin's opinion (pt. III) on the Commerce Clause, only his conclusion.  Sutton has his own separate opinion and rationale (his Pt. II) that leads him to uphold the ACA on Commerce Clause grounds, but only because the plaintiffs at this point can mount only a facial attack.  Graham dissents on Commerce, and joins Sutton to form a majority rejecting the Taxing Power rationale.  Thus, a very narrow win for the Administration.

    The votes matter here (none / 0) (#9)
    by Big Tent Democrat on Wed Jun 29, 2011 at 12:44:28 PM EST
    imo. I found all the opinions pedestrian at best, appallingly bad at worst.

    I hope to never have to read them again.


    It sure seems like a lot of (none / 0) (#10)
    by eric on Wed Jun 29, 2011 at 01:13:01 PM EST
    analysis on issues that I don't think are really that close.   Of course health care is economic.  Of course if a person doesn't have health insurance and finds himself in need of it, it impacts the health care system.

    But suppose an individual has not nor ever will seek to be part of this system?  Does simply breathing air in the US require you to do anything else? I can think of no other requirement that the government has for individuals that requires one to purchase something simply because one lives in the US.

    Car insurance?  Sure, but you can choose not to drive.  School, sure you have to go, but its free.

    Something about it just seems a step too far.  

    An odd argument ... (none / 0) (#11)
    by Robot Porter on Wed Jun 29, 2011 at 01:37:00 PM EST
    by their reckoning the Federal Government could mandate that individuals purchase any product or service as long as it has substantial effect on interstate commerce.  Don't think that's true.

    Clearly, they're afraid to use the arguments which validate auto insurance, or even income tax, because they don't want those issues debated.

    Medicare for all, which a majority of the public supported in poll after poll for the last 15+ years, would have been so much easier.  

    But even (none / 0) (#13)
    by eric on Wed Jun 29, 2011 at 01:43:48 PM EST
    the comparisons to auto insurance fail because that mandate is to protect people because you are out there driving around.  You are engaging an activity and the government is placing a requirement on you if you want to engage in that activity.

    Suppose the government forced you to buy auto insurance even though you didn't have a car nor ever wanted to get one?

    If I drive without insurance and crash into someone, does that affect interstate commerce?  Sure it does.  But if I'm not driving, where's the hook?  


    I guess they ... (none / 0) (#14)
    by Robot Porter on Wed Jun 29, 2011 at 01:59:47 PM EST
    could make the argument that you're "driving around" in a (possibly) disease carrying and transmitting body.

    N.B.:  I'm not serious.  N.B. II:  I still wouldn't put it past some pol to use this argument.


    Yep, you're right (none / 0) (#15)
    by eric on Wed Jun 29, 2011 at 02:19:48 PM EST
    it basically comes down to this, if you are breathing the air in this country, you must buy what the congress tells you to.

    I was thinking about an extension of this health care mandate thing in the context of long-term disability insurance.  Paying for the care of someone who is long term disabled is a huge expense.  If one doesn't have adequate long term disability insurance, the government picks up the tab by providing various types of help to the disabled person.  All of this clearly affects interstate commerce.  Could Congress pass a law mandating that all of us purchase long-term disability insurance?


    Eric, I'm sure ... (none / 0) (#16)
    by Robot Porter on Wed Jun 29, 2011 at 02:29:01 PM EST
    they're working on it.

    The "necessary & proper" construct (none / 0) (#17)
    by christinep on Wed Jun 29, 2011 at 05:09:30 PM EST
    helps here...and not just as alternative theory. The indirect nature of one analysis tends to buttress the other.

    Also: Given the judicial players to date, the fact that a Republican appointee moved beyond--tentatively or not--the ideology displayed in other earlier courts is heartening.


    who pays for long-term care? (none / 0) (#19)
    by the capstan on Wed Jun 29, 2011 at 05:40:49 PM EST
    "If one doesn't have adequate long term disability insurance, the government picks up the tab by providing various types of help to the disabled person."

    Not so much--my husband's ltc was used up July 1, 2006.  I knew I'd have to sell my house so I could pay his nursing home expenses.  (We were middle-class, of course.)  I believe it was July  6, 2006, that he died.  I'd not have gotten a penny beyond his social security from the government.  July 6 was his "free at last day"--and, in an odd sort of way, his last gift to me.


    I'm very sorry for your loss (none / 0) (#21)
    by sj on Wed Jun 29, 2011 at 06:43:06 PM EST
    It's just all so sad.

    SITE VIOLATOR (none / 0) (#23)
    by Peter G on Wed Jun 29, 2011 at 08:37:19 PM EST