Lisa Soronen
State and Local Legal Center
lsoronen@sso.org
It Takes Five Votes to Win…
 To make sense of blockbuster Supreme Court
decisions you need count for 5 votes and figure out the
Court’s reasoning
Counting Votes Should be Easy
 But don’t tell that to CNN or Fox News
 4 issues means endless possibilities
 Tax or penalty via the Anti-Injunction Act?
 Individual mandate constitutional?
 Act severable?
 Medicaid coercive?
As Clear as Mud?
 “Did Roberts originally vote to invalidate the mandate
on commerce clause grounds, and to invalidate the
Medicaid expansion, and then decide later to accept
the tax argument and essentially rewrite the Medicaid
expansion…to preserve it?”
 David Bernstein, Volokh Conspiracy
 Washington Post ask: Why do we need Supreme
Court Cliff Notes?
http://www.washingtonpost.com/opinions/why-weneed-supreme-court-cliffsnotes/2012/06/29/gJQAo59JCW_story.html
Anti-Injunction Act
 Five Justices (Roberts and the liberals) say the “shared
responsibility payment” is a penalty and not a tax
 Why? Because Congress called it a penalty, Congress
called other things in the Act “taxes,” and just because
the “penalty” is assessed and collected as a tax doesn’t
mean it is a tax
 Why does this issue matter? The lawsuit can proceed
as a result(we don’t have to wait until 2014 when the
first “shared responsibility payment” is made for a
court to be able to reach a decision on the merits)
Individual Mandate
 Five Justices (Roberts and the liberals) concluded the
“shared responsibility payment” is constitutional as a
“tax” not a “penalty” for constitutional purposes
 Article I, Section 8 of the Constitution says Congress
may “lay and collect Taxes”
 This is the very simple argument: individual mandate
doesn’t force anyone to buy insurance it simply taxes
those who don’t; the federal government has the
constitutional authority to tax
Individual Mandate
 Courts look at three factors to look at the determine if
an exaction is a tax: how heavy is the burden, is
scienter a factor, who is doing the collecting
 This is a tax: it is far less than the cost of insurance, it
is assessed not based on the state of mind of the
violator, and it is collected by the Internal Revenue
Services
 The fact that it influences conduct is “nothing new”
(cigarette and saw-off shot gun taxes)
 Not a punishment for doing something unlawful – 4
million people are expected to pay the tax
Huh?
 “I’m wondering whether a close reading of the opinions will
somehow persuade me that the individual mandate can be
a ‘tax’ for constitutional purpose, but ‘not a tax’ for AntiInjunction Act purposes.”
 David Bernstein, Volokh Conspiracy
 The dissent isn’t impressed by this “verbal wizardry”:
 “The Government and those who support its position on this
point make the remarkable argument that §5000A is not a tax
for purposes of the Anti-Injunction Act … but is tax for
constitutional purposes.”
 Congress could have said this isn’t a tax for Anti-Injunction
purposes but it didn’t
Dissent on Taxing Power
 The exaction in this case is imposed for a violation of
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the law (shall…requirement…penalty)
IRS collects a lot of penalties
Penalties varying based on ability to pay is an “utterly
familiar practice”
The absence of a scienter requirement does not
suggest a tax (presence of scienter would suggest a
penalty)
The mandate and the penalty are located in Title I of
the Act, “its operative core,” rather than in Title IX
containing the Act’s “Revenue Provisions”
Here is the Real Coup…
 Five Justices (Roberts and the conservatives) conclude
that the that the individual mandate isn’t
constitutional under the Commerce Clause (or the
Necessary and Proper Clause)
 Why doesn’t this matter? 5 votes upheld the individual
mandate as a tax
 Why does this matter? It is a victory for federalism
Why No Commerce Clause, Justice
Roberts?
 “The power to regulate commerce presupposes the
existence of commercial activity to be regulated.” (This
case is about inactivity)
 “[T]he Government’s logic would justify a mandatory
purchase to solve almost any problem.” (No limiting
principle—if you can force people to buy health insurance
you can force them to buy anything--broccoli horrible)
 “The phrase ‘active in the market’ cannot obscure the fact
that most of those regulated by the individual mandate are
not currently engaged in any commercial activity involving
health care, and that fact is fatal to the Government’s
efforts to ‘regulate the uninsured as a class.’” (It does not
matter that the healthy will someday buy insurance, they
aren’t buying it now).
If You Have a Free Moment
 Justice Ginsburg meets Justice Robert toe-to-toe on
every point:
 Activity and inactivity are two sides of the same coin
 Requiring people to buy health insurance is different
than requiring them to buy anything else – there will be
no “broccoli horrible”
 Everyone will need health care someday. Period.
Justice Roberts Writes Alone
 Why when the four other conservative Justices agree
with him on the Commerce Clause?
 They want to make a point in their co-authored opinion
 Dissenters are bothered by the unfairness of those not
needing health care being forced to pay for everyone else
 Other than that, the opinion (to me at least) reads a lot
like Roberts’ opinion
Necessary and Proper
 When is the last time this topic has come up in casual
conversation?
 Roberts: this provision is really about the execution of powers
already granted; the individual mandate involves the creation
of a right
 Dissent agrees with Roberts: we don’t know the exact scope
of the Necessary and Proper Clause but “the proposition that
the Federal Government cannot do everything is a
fundamental precept”
 Ginsburg (Sotomayor, Breyer and Kagan) opine that the
individual mandate is necessary to make the entire law work
(guarantee-issue and community rating)
 At least one commentator sees no change in the law as a
result of this case
Medicaid
 Brace yourself for the vote counting but first the big
picture
 If states want to participate in the Medicaid expansion
they can (but they have to follow the rules) (voluntary
carrot okay)
 If states don’t want to participate in the Medicaid
expansion they don’t have to and they can continue to
participate in the unexpanded version of Medicaid
(mandatory stick not okay)
The Votes are In…
 Seven votes for the Medicaid expansion being
unconstitutionally coercive (Roberts, Breyer, Kagan,
Scalia, Kennedy, Thomas, and Alito)
 Five votes for striking down the stick (cut off all funds)
but keeping the carrot (participate if you want to)
(Roberts, Ginsburg, Breyer, Sotomayor, & Kagan)
Let’s Look a Little Closer at the
Math
 Four Justice say Medicaid and the entire expansion
should be struck down (Scalia, Kennedy, Alito, &
Thomas)
 Three Justice say Medicaid is coercive but only the
stick should be struck down (Roberts, Kagan, and
Breyer)
 2 Justices (Ginsburg & Sotomayor) say Medicaid isn’t
coercive but clearly 7 of you think it is so we will keep
things easy and create a majority for keeping the carrot
and striking the stick
Why Coercive, Justice Roberts?
 No legitimate choice here…”it is a gun to the head”
 This isn’t South Dakota v. Dole (5 percent of highway
funds)
 States stand to lose all Medicaid funding which is 20%
of the average state budget
 The expansion is really a new program
 And OBTW, “We have no need to fix a line either. It is
enough for today that wherever that line may be, this
statute is surely beyond it.”
Why Keep the Carrot, Justice
Roberts?
 The expansion in and of itself is okay
 The penalty with non-participation isn’t okay
 I’m not rewriting anything…I’m just deleting the
unconstitutional part
Why Would the Dissent Ditch it All?
 Side note: dissents reasoning for coercion sounds a lot like
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Roberts’ (“no real choice”)
ACA depend on states’ having no choice, many low-income
people can only obtain insurance through the Medicaid
expansion
A state’s withdrawal might cause everyone to have higher
premiums (Medicaid expansion will no longer offset the
costs to the insurance industry imposed by the ACA)
If stated don’t join the expansion they will just be
subsidizing other state’s expansions
Congress should do the rewriting
Justice Ginsburg is Truly Tireless
 “A ritualistic requirement that Congress repeal and reenact
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spending legislation in order to enlarge the population
served by a federally funded program would advance no
constitutional principle and would scarcely serve the
interests of federalism.”
Congresses should be able to change Medicaid; states have
been warned
Medicaid has been changed again and again; states have a
lot of autonomy
Only Medicaid funds are threatened to be withheld; federal
government could do Medicaid itself
Bottom line when it comes to the remedy: do a salvage
operation not a demolition
What about Severability?
 This issue is only relevant to the dissent because they
would strike down the individual mandate and the
Medicaid expansion entirely
 Will the truncated act operate in a manner Congress
intended?
 Would Congress have enacted the remaining provisions
standing alone?
 Dissent would invalidate the entire act given how
interrelated the provisions are
 Universal coverage was the goal of the act; it is no longer
possible without the individual mandate and Medicaid
A Good Witch or a Bad Witch?
 Putting aside how you feel about the Affordable Care
Act, there were many victories for federalism
 Individual mandate wasn’t upheld on Commerce Clause
grounds (no broccoli horrible)
 For the first time ever the Court finds a federal statute
coercive
 Choice is good right? Some states want the Medicaid
expansion; others don’t
Big Questions
 What was Roberts thinking (to vote with the Court’s left)?
 If the decision would have been 5-4 individual mandate
unconstitutional this decision would have been seen as
political; the Court as an institution looks better if all Justices
don’t vote on political party lines
 Did Robert’s switch votes well after oral argument and try to
bring Kennedy along?
 In 75 years no President’s signature piece of legislation has
been struck down--Roberts’ position is one of judicial
restraint (which is a conservative value)
 Your legacy isn’t interesting if you just do what people expect
you to
Big Questions
 I am not done with Roberts yet. Regardless I think
Roberts can sleep at night for three reasons:
 Lifetime tenure
 If Roberts’ only choice was the Commerce Clause I don’t
think he could have pulled the trigger
 Roberts knows what you know: if Congress doesn’t like
this they can repeal it tomorrow
 It is also possible Roberts simply believes everything
he wrote
Big Questions
 What will the states do about taking the Medicaid money
and what will the implications be? So far: yes, no, maybe
 What is the future of the coercion doctrine?
 When will the federal government have to put the stick away?
Always or only in the case of a program as big as Medicaid?
 Would a prior warning have made a difference?
 The Justices mostly agreed about coercion (only Justices
Ginsburg and Sotomayor found no coercion)
 Will states be embolden by this partial victory to more
routinely challenge federal spending clause legislation?
Big Questions
 How will this ruling affect the election? Will an
undecided voter in Ohio view the ACA more favorably
now that is has the Supreme Court’s blessing?
 Most of the court watchers were wrong about the
outcome in this case. What is to be made of an
institution that seems so unpredictable?
 Fewer than 50% of Americans have ever supported the
law but the data is deceptive; many of them wanted
the law to go further. What does this mean?
Big Questions
 How will the federal government collect the “shared
responsibility payment”?
 Justices Kagan and Sotomayor might be on the Court
for a long time and they clearly view the Commerce
Clause broadly. Will this have future implications?
 Does the fact that inactivity cannot be regulated by the
Commerce Clause have many (any?) practical
implications? (is there a reason none of the examples
of possible expanded federal power were serious—
broccoli horrible?)