Obamacare: A welcome, well-reasoned court ruling
IF THERE’S one constant in American history, it’s a capacity to surprise.
That was spectacularly true this week as a majority of the U.S. Supreme Court, led by conservative Chief Justice John Roberts, upheld the linchpin of the Obama administration’s program to ensure most Americans have health insurance, while also curbing the power to force states to expand their public plans.
The big shock was Mr. Roberts’ opinion upholding the so-called individual mandate. It requires most people to buy basic health coverage or pay a penalty through their taxes.
The mandate is a red flag to libertarians. But since Americans (and the insurance industry) apparently want their coverage privately delivered, the mandate was a trade-off for making insurers cover the sick. If healthy people could avoid coverage until they needed it, insurance pools would go broke.
Conservatives hoped Chief Justice Roberts would balk at an intrusion on private life. But he surprised everyone by interpreting the mandate not as a legal compulsion, but as a tax.
The government said the mandate fell under Congress’s power to regulate commerce. But that power, the chief justice reasoned, applies only to existing activity. Interpreting it to allow regulation of what people don’t do would vastly expand federal authority and undermine limited government. It would be unconstitutional.
But a federal tax would be legal. Saying the mandate doesn’t make it unlawful to go without coverage, and doesn’t impose a penalty high enough to make anyone buy insurance, a tax is what the court found it to be.
On the other major issue, the majority sided with the states against the federal government.
Obamacare proposed to withhold federal funding from existing state Medicaid plans that cover pregnant women, children, needy families, the blind, the elderly and the disabled if states did not expand these (with additional federal funding) to include everyone with an income less than 133 per cent of the federal poverty line. The court said this “economic dragooning” of states violates the constitutional principle that cost-shared programs must be voluntary and undermines federalism.
The court said it’s up to elected officials to decide whether Obamacare is good policy, a dispute that will now rage even more fiercely through the presidential election campaign.
President Barack Obama must still overcome the handicap that most Americans disapprove of Obamacare, though the court ruling may cause some to reconsider. Republican candidate Mitt Romney is making repeal of Obamacare his first priority. But the fact that he created a similar insurance program in Massachussetts, with its own individual mandate (now tax), is a hit to his credibility.
What the court did contribute was a careful and balanced judgment on a subject that has inflamed passions and divided Americans.
The ruling allows the federal government to act effectively on health insurance, but not in a way that expands federal powers over individuals or states. Sensibly, it forces Washington to use carrots, not clubs, to get the states to improve their insurance plans.
In setting intelligent limits on federal power, and in refraining from judicial activism itself, the court did show a form of conservatism that neither conservatives nor liberals expected.
For outsiders, it’s hard to understand America’s health hang-up: why federal relief for natural catastrophes, like the Mississippi bursting its banks, is not controversial, while federal help for health catastrophes, like cancer raging through the uninsured individual, is an invasion of privacy. Hopefully the court ruling will allow America to surprise again and provide effective health coverage in its own way.
Not a Tax...
Submitted by thotful on June 30, 2012 - 11:22am.
Your editorial is excellent, but has one very important incorrect statement.
The individual mandate was not, and could not, be ruled a tax. As Justice Roberts wrote in the majority decision "...the law specifically does not involve a tax." "If it did," Roberts clarified," the Court would have had no choice but to reject the case for lack of jurisdiction as a tax case cannot be brought until someone is actually forced to pay the tax."
The fact that the mandate was found to be legal under the powers granted to Congress to collect fees such as taxes and the penalty in a similar manner is an entirely different matter.
This is important in the ruling as what it says is, just as you point out, that anyone who wishes to not pay for health care coverage will be subject to a penalty - which, of course, then enlarges the pool of people who will join in, thus lowering costs (or collect back the cost through the penalty). There is a big difference between simply levying a tax and the court finding that the mandate is legal.
The American people can now move on and talk about what they would like their health coverage to look like - the President sees a US where kids are covered under their parents plans until age 26, and people can not be denied coverage because of a pre-existing condition or because they get sick. I think the majority of Americans will agree.
A Slight Disagreement
Submitted by daveburris on June 30, 2012 - 11:28am.
I must say, I respectfully disagree. This was judicial activism, writ large. Roberts decided that a penalty, for not engaging in commerce, is a tax, thus rewriting the legislation, which is the role of Congress. Usurping the role of Congress is judicial activism, precisely.
Not only that, but in the US there is an Anti-injunction act - a 19th century-law which said a tax cannot be challenged in court until someone has actually been forced to pay it. The taxes on this law do not kick in until 2014, and there certainly have been no penalties as yet.
This was discussed on day 1 of oral arguments, if this penalty was a tax, as Roberts now states, then the case should have been tossed at that time, until taxes started to be collected. So it is a penalty, not a tax.
But even worse, The Obama administration always maintained that the assessment was a penalty, not a tax. And an initial version in Congress, actually did propose a tax, but then Congress INTENTIONALLY substituted a mandate with a penalty for failure to comply, they could then contend that no one’s taxes were being raised. Roberts turned Congress's actual intention on it's head.
If that isn't judicial activism, then I don't know what is.
But this decision has sure galvanized the Republicans, and with this albatross, and a slow economy, dogging the Democrats, it looks like a Republican celebration in November. But then, I could be wrong.