President Barack Obama speaks at a campaign fundraiser at the University of Vermont in Burlington, Vt., Friday, March, 30, 2012. (AP Photo/Pablo Martinez Monsivais)
Tuesday’s historic oral argument on the constitutionality of Obamacare left some court watchers worried that the law was on the ropes. Jeffrey Toobin of the New Yorker and CNN pronounced the argument “a train wreck for the Obama administration," and predicted that the law would be struck down. Adam Liptak of the New York Times opened his account by describing the “barrage of skeptical questions” directed at Solicitor General Don Verrilli as he stood up to defend the law. There was certainly a basis for their assessment. Justices Antonin Scalia, Samuel Alito, John Roberts and Anthony Kennedy all asked tough questions of Verrilli, and no one has any doubts about where Justice Clarence Thomas stands on the matter, even though he predictably maintained his now-six-year silence as a sitting justice. The four more liberal justices all made clear that they viewed the Affordable Care Act’s mandate—the requirement that people who can afford to do so must purchase health insurance or pay a tax penalty—as constitutional. But it takes five votes to uphold the law. So will the law be struck down?
As Mark Twain might say, reports of Obamacare’s demise are greatly exaggerated. While the conservative justices expressed considerable reservations about the law’s scope, Justice Kennedy, the key swing vote, also noted, near the very end of the argument, that the unique context of the healthcare market may be sufficient to validate the “individual mandate.” The biggest challenge the government has faced in defending the law has been the articulation of a limiting principle, and by argument’s end it seemed that Justice Kennedy might have heard one that he could sign on to. If he does vote to uphold the law, it’s possible that Chief Justice Roberts will join him, in the interest of not having the case decided by a single vote, in which case the vote would be 6-3.
Kennedy began his questioning by asking Verrilli whether Congress could “create commerce in order to regulate it,” echoing the challengers’ contention that while Congress can regulate commerce under the Commerce Clause, it should not be empowered to require people to “enter into commerce”—by purchasing health insurance against their will—in order to regulate them. If Congress has that power, the challengers maintain, there would be no limit to the federal government’s power. It could require people to buy broccoli, health club memberships, cellphones or burial insurance—all hypotheticals posed to the solicitor general by the Court’s conservative justices. And one of the Constitution’s most basic premises is that the federal government is a government of limited powers. As Justice Kennedy asked Verrilli, “Can you identify any limits on the Commerce Clause?” To get Kennedy’s vote, there has to be an affirmative answer to that question.
There is a limiting principle, however, and Verrilli and several of the justices articulated it during the two-hour-long argument. The nature of healthcare is such that we are all inevitably participants in the healthcare market (save for the Amish*, and they are exempt). No one can avoid the need for healthcare, no one can predict when he or she will need it, and virtually no one can afford it when he or she does need it. And ultimately, the healthcare market provides free care to those who cannot pay for it (principally at hospital emergency rooms). Of course nothing is truly free, so hospitals and healthcare providers pass on the cost in higher fees and premiums to those who do pay. As such, those who do not buy insurance shift the costs of their care to the rest of us, increasing the average insured family’s costs by about $1,000 per year. So unlike the markets for broccoli, health clubs and cellphones, this is not a market anyone can truly avoid, and doing nothing ends up harming others by shifting one’s own costs to those who carry insurance.
Given those realities, to uphold this law would not give Congress unfettered power to require us to eat granola, purchase electric cars or join health clubs. Participation in the markets for those products is not inevitable, nor does one person’s choice not to purchase such products impose substantial and foreseeable costs on others because he will be able to get the product for free even if he doesn’t buy it. Upholding the individual mandate would simply establish that where a national market is the victim of such a free-rider problem, Congress may address it as part of its general authority to regulate that market.