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Another Fed Judge Upholds Health Reform

Another federal district judge has ruled that the Affordable Care Act is constitutional. And this one didn't mince words. In a 64-page opinion, Judge Gladys Kessler dismissed a lawsuit brought by a group of individuals who claimed the government has no right to impose an individual mandate—that is, to require that they either obtain insurance or pay a fee to the government.

Kessler’s opinion makes the score 3-2, in the sense that the federal bench has now produced three detailed defenses of the Affordable Care Act but just two opinions striking down the law. The three came from Democratic appointees, while the two came from Republican appointees. Of course, the score is meaningless anyway. The case is likely headed to the Supreme Court--where, in case you've forgotten, five of the nine judges are Republican appointees. 

Still, lower court rulings can help shape the justices' thinking. Kessler’s opinion was, to this untrained legal mind, both the most detailed and in some ways the most interesting of the three opinions upholding the Act.

Kessler actually rejects the argument that the government’s taxing power justifies the mandate. Like the two conservative judges who struck down the law, she holds that the government’s decision not to call the requirement a “tax” means that it is not a tax. (I continue to disagree with that argument, for reasons I stated here.) But Kessler spends most of her time on the other issues: Whether the constitutional powers to regulate interstate commerce and to do what is “necessary and proper” for carrying out its duties justify the mandate. She thinks the mandate falls clearly within both powers—and she doesn’t even seem to think it’s a close call.

As to the argument, put forward by the plaintiffs, that the mandate is unconstitutional because it purports to regulate “inactivity,” she dismisses that argument as “semantics.”

this Court finds the distinction, which Plaintiffs rely on heavily, to be of little significance. It is pure semantics to argue that an individual who makes a choice to forgo health insurance is not “acting,” especially given the serious economic and health-related consequences to every individual of that choice. Making a choice is an affirmative action, whether one decides to do something or not do something. They are two sides of the same coin. To pretend otherwise is to ignore reality.

In response to the plaintiffs’ claim that they would prefer to pay for their own medical care, Kessler says that they “have no way of predicting what their future medical costs will be” and concludes it likely their future medical care will likely impose costs on others. To make her point—and, perhaps, to curry favor with policy wonks like me—she even cites statistics from the Department of Health and Human Services showing that the average hospital stay in the U.S. “lasted 4.6 days and included total charges of $29,046.”

But the most important part of her decision may be her specific response to the slippery slope argument that legal critics of the mandate, including Judges Henry Hudson an Roger Vinson, have made. This is what has become known as the “broccoli argument”: If the government can make you pay for health care, the critics say, then why can’t it make you buy broccoli? Or a GM car? Or anything else?

This second aspect of the health care market distinguishes the ACA from Plaintiffs’ hypothetical scenario in which Congress enacts a law requiring individuals to purchase automobiles in an attempt to regulate the transportation market. Even assuming that all individuals require transportation in the same sense that all individuals require medical services, automobile manufacturers are not required by law to give cars to people who show up at their door in need of transportation but without the money to pay for it. Similarly, food and lodging are basic necessities, but the Court is not aware of any law requiring restaurants or hotels to provide either free of charge.
It should be emphasized that this distinction is not merely a useful limiting principle on Congress’s Commerce Clause power. Rather, it is a basic, relevant fact about the operation of the health care market which is critical to understanding the ACA’s efforts to reform the health care system. The requirement placed upon medical providers by federal law to care for the sick and injured without recompense is part of the cost-shifting problem that Congress sought to redress by enacting the ACA. When a supplier is obligated by law to produce goods or services for free, there is bound to be a substantial effect on market prices if consumers’ behavior results in that obligation’s frequent invocation.

This is a key dividing line between the judges who have upheld the Affordable Care Act and those who have not. Those who have approved of the law recognize that insurance markets are, by their nature, different from other kinds of markets—and that it is possible to write rules for them, like the individual mandate, that might not pass muster in other markets. The two judges who have ruled against the Act have refused to recognize this distinction as meaningful.