The fourth question was whether the ACA’s expansion of Medicaid eligibility to around $30,000 income for a family of four (replacing widely varying income levels in the states with a uniform standard of eligibility) violated the Constitution. Splitting opinions among the four liberal judges, Roberts found that the expansion of eligibility wasn’t the problem, but that applying a provision of the ACA which allows the Secretary of Health and Human Services to withhold existing Medicaid funds for non-compliant states would be unconstitutional. He felt that such a power would allow the federal government to “dragoon” the states into actions with which they might disagree. In the Chief’s words, “The Constitutional violation is fully remedied by precluding the Secretary from applying the (enforcement section).” Then, in the Court’s definitive statement, “The other provisions of the Affordable Care Act are not affected.”
We reported in the last installment of this series that the decision of the Supreme Court was but the first leg of a metaphorical Triple Crown to be run in the health-care contests of 2012. ObamaCare won the Supreme Court Derby. Now it’s on to the second leg: the Congressional and Presidential elections. Eventually, and perhaps the most elusive jewel in the triad, will be the final battle over taxing and spending planned for the six-week lame-duck session of Congress at the end of the year.
Consistent with the personality driven focus of the news, the role of Chief Justice Roberts is central to the daily chatter. Most analysts, with this commentator included, didn’t see the outcome in advance. We said comfortably that Kennedy was the swing vote on the Commerce Clause, perhaps joined by Roberts to reach a six vote majority. If the law went down, it was roundly speculated, that Roberts and the conservative four would form the majority. Yet, the taxing authority was there in plain sight, tucked into the second part of Verrilli’s arguments. We even noted Justice Alito’s jest to Verrilli that the penalty wouldn’t be a tax one day, but would be a tax the next. It seems that Roberts was listening.
Serious observers of the Court will offer insight for years to come. We, for our part, draw several conclusions from this first leg of our Triple Crown.
This is a fundamentally conservative Court, linked closely to the vision of the Right. While Roberts’ vote may have upheld Obama’s signature achievement, the conservatives spoke out in fury. The insight comes from the lengthy dissent from Justices Scalia, Kennedy, Thomas and Alito. It was presented to the Court by Kennedy, but had Scaliaesque rhetoric at its root. The dissenters roundly reject the Commerce Clause argument and further find the Medicaid expansion to be an unconstitutional coercion of the states. In their dissent, they even toy with the taxing power, observing that the issue is not the power to tax, but whether Congress chose to use that power in framing the law.
The dissent is, on one hand, a standard treatise on limited Federal power. But the words tell a deeper story. The dissent frames the Medicaid question as whether the Constitution permits conditioning the receipt of funds “under a massive state administered federal welfare program . . .” We learn further from the dissent that we now have “sizable federal Departments . . . of Education, . . . Health and Human Services, . . . and Housing and Urban Development,” that are “not mentioned among Congress’ enumerated powers.” Finally, according to the dissenters, the Court’s decision “creates a debilitated, inoperable version of health care regulation that Congress did not enact and the public does not expect. It makes enactment of sensible health care regulation more difficult . . . (and) may not survive the necessary congressional revision.”
Framed in the elegance of Constitutional argument, these are Republican talking points. The dissenters essentially say that we wouldn’t have voted for the law because our side has a different view. Implicitly Roberts agrees, and he makes clear in his decision that “we do not consider whether the Act embodies sound policies. That judgment is entrusted to the nation’s elected leaders.” While Roberts chooses to uphold the law, five justices — six or seven likely by 2016 with a Romney victory in the fall — would be prepared drastically to constrain the twentieth-century policies over federal spending and the regulation of commerce.
Far removed from the language of competing precedent in the decision and dissents, this observer has a number of practical questions: Did the Court just say that the Federal government can’t use the Commerce Clause to support the necessary conditions for an individual private insurance market to exist? What about Massachusetts? Is the law that Washington can’t exercise a power that Massachusetts enacted in 2005? Can fifty states acting separately exercise the same power over their citizens that the nation can’t? Are the dissenters taking us back to the Articles of Confederation, deemed too weak to support the development of a new nation more than two centuries ago?
Isn’t there a faint echo here of a daily debate heard across the Atlantic Ocean as the European Union balances the operation of a continental economy with the actions of component states. No matter how you slice it, there’s far more at play here than how we receive and pay for health care. A word to the wise: Listen carefully for the falling of other boots.
But let us return to the law itself. While the ACA was upheld in its entirety, the limitation on enforcement of the Medicaid expansion opens a new chapter in the debate. The expansion with all of its financial incentives remains intact. The federal government pays one-hundred percent of the expansion costs for three years, more than ninety percent over a decade. With the decision to limit the federal government’s ability to coerce states into expanding their coverage, sixteen million potential Medicaid enrollees are at risk — and the structure of a comprehensive system: Medicare, Medicaid, and private insurance could unravel. In the short run, the voices of conservative Governors are enhanced. Still, there may be a functional silver lining. If the intense politics of the current division recede, a number of states may simply accept significant federal support to solve a pressing health care problem. Politicians in states that choose to not participate in the reform will hear from their constituents, “Why should our federal taxes support other states and not our own?” Health care interests, hospitals, doctors, and advocates for the poor will have a strong local case to make. As ideological opponents lose the intrusive-federal-power rallying cry, the law may still take hold state by state.
Our observations of the 2012 political campaign lie in a future installment of this series, but the initial framing of reactions to the Supreme Court decision raise the critical question: Whither Romney?
For Speaker John Boehner and Congressional Republicans, the decision frames a simple goal — to repeal ObamaCare in its entirety (and, by the way, re-elect the majority he built in 2010 on the same argument.) Without opening an internal debate with the ultra-conservative freshmen who have defined his caucus, Boehner can enjoy the opportunity to attack not only the President, but now the ultimate evil, (so sayeth the Supreme Court): a tax.
We predicted that the Romney campaign will have a more difficult time taking health care center stage in the campaign. The first signal came from Romney senior advisor Eric Fehrnstrom who contradicted the tax message with Romney’s view that the mandate was indeed a penalty. If the mandate were a tax, then did Romney enact a tax on the people of Massachusetts in 2005? Within hours of Fehrnstrom’s statement, no doubt influenced by comments from anti-tax sultan Grover Norquist, Romney contradicted his own aide. As of this writing, Governor Romney has declared, “It’s a tax.” Stay tuned.
In a rational world, no one would care. But in the hyperventilated universe of televised talking points and advertising demonization, such an admission calls up the question: Who is Mitt Romney? Throughout the coming months, Gov. Romney’s pledge to repeal the Obama version of his Massachusetts law will challenge the candidate at every turn.
The Democrats, having lost the fundamental battle over public opinion, will stay close to the law’s discrete, noncontroversial benefits. By Election Day virtually all American parents will know that, while the economy may be keeping your adult child living at home, you will now have the right to cover them under your family insurance policy until they are 26. Nearly every American will know that the insurance industry be required to sell you a policy (and let you use it), even if you’re sick. And in a recently added point, women will know that they no longer face gender-determined higher rates. The golden arrow in the Democrats’ quiver will fly in August when millions of Americans will receive mid-summer rebate checks from insurance companies that overcharged them.
As Republicans argue for “Repeal,” Democrats will rattle off the list of positives. Should Romney suggest “Replace,” he’ll be dragged to specifics, inviting comparison with his earlier law. Obama, with renewed energy from the historic Court decision, will assert the opportunities to improve the law in a second term. Even the short-term battles of 2012 won’t be settled until the election sets the stage for the budget showdown at year’s end. With continuing uncertainty, however, ObamaCare is now the law which others must change.
That, at least for a group of policy professionals gathered around a conference table in Washington once-upon-a-June morning, brings an enormous sense of progress.
Jim Tallon is the president of the United Hospital Fund, a think tank in New York City. He served previously as Majority Leader of the New York State Assembly. All political cartoons by DonkeyHotey.