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This blog is the work of an educated civilian, not of an expert in the fields discussed.

Thursday, October 07, 2010

Health Care Reform Act: First Ruling

And Also: The Rays are playing as badly as they did against scrubs at the end of the year while the Yanks continue to play with the Twins in the playoffs like a cat plays with a mouse.

The first lower court ruling on the "Health Care Reform Act" (so hard to say! must use "Obamacare" instead; simply for the brevity ... no other reason, really!) was handed down. One charm is that it is brief (twenty pages of indented discussion, half on standing that can be skimmed over) and to the point. The standing comes because even thought the "individual mandate"* at issue isn't required for years, arguably current fiscal decisions are affected.

Three quarters of the way through, the opinion gets to the heart of the matter. The excerpts below include the core arguments and a summary provided by the court as to how they apply in this cases. I combined them and separated the two by notation:
First, the economic decisions that the Act regulates as to how to pay for health care services have direct and substantial impact on the interstate health care market. Second, the minimum coverage provision is essential to the Act’s larger regulation of the interstate business of health insurance.

[1] Far from “inactivity,” by choosing to forgo insurance plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now through the purchase of insurance, collectively shifting billions of dollars, $43 billion in 2008, onto other market participants. As this cost-shifting is exactly what the Health Care Reform Act was enacted to address, there is no need for metaphysical gymnastics of the sort proscribed by Lopez.

The plaintiffs have not opted out of the health care services market because, as living, breathing beings, who do not oppose medical services on religious grounds, they cannot opt out of this market. As inseparable and integral members of the health care services market, plaintiffs have made a choice regarding the method of payment for the services they expect to receive.

[2] The Act regulates a broader interstate market in health care services. This is not a market created by Congress, it is one created by the fundamental need for health care and the necessity of paying for such services received. The provision at issue addresses cost-shifting in those markets and operates as an essential part of a comprehensive regulatory scheme. The uninsured, like plaintiffs, benefit from the “guaranteed issue” provision in the Act, which enables them to become insured even when they are already sick. This benefit makes imposing the minimum coverage provision appropriate.
Thus, the unique nature of health care in particular make the "inactivity" here really just a play on words, since people aren't really being "inactive" at all, but making active decisions that significantly affect matters of interstate commerce that the Congress can control in this fashion. This includes via a penalty added to further the end:
Congress is authorized by the Commerce Clause to impose a sanction “as a means of constraining and regulating what may be considered by the Congress as pernicious or harmful to commerce.”
So, this is not an illegitimate "direct tax" either. The argument is not dwelt on given the focus on the Commerce Clause, but it also isn't a direct tax (I would add) because it is an excise on the "activity" in question. A "direct tax" is truly a tax on inactivity, particularly on a person (the main concern was slaves here, but a blanket poll tax can be deemed one too) and land.

Finally, "inactivity" was addressed before, at least, activity not directly involving interstate commerce. As noted by the ruling, growing wheat or marijuana for personal consumption and not selling to black people were deemed things that can be barred when they significantly affect interstate commerce. And, not buying insurance, particularly given mandated insurance coverage when desired (I would add bankruptcy protections and emergency care), fits the bill.

A good little ruling to start the ball rolling.

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* There are various constitutional arguments, most pretty silly, even (see Orin Kerr and plenty of comments over at Volokh Conspiracy) though attacks on the individual mandate are too. As the ruling notes:
The Individual Mandate requires that each “applicable individual” purchase health insurance, or be subject to a “penalty” or “Shared Responsibility Payment.” The definition of “applicable individual” is “an individual other than” religious objectors who oppose health insurance in principle, non-residents or illegal residents, and incarcerated individuals. The Act, and the Individual Mandate, therefore, apply to everyone living in the United States, unless they are excepted.
The income limits plus the exceptions covering lots of people alone, this only starts to underline the slim "threat" at issue here.