This morning the Court returned for the final set of arguments in the challenges to the Affordable Care Act (ACA). First up in the morning, for ninety minutes, was the question of “severability” – what part, if any, of the ACA survives if the Court holds that the mandate is unconstitutional? Many people who follow the Court had predicted that this argument could be a largely hypothetical (and therefore boring) one if it seemed clear yesterday that the Court would uphold the mandate. But with the prospect that the mandate will be struck down very real, everyone was now watching this severability argument carefully. And it was far from boring.
Paul Clement was back at the podium this morning on behalf of the twenty-six states challenging the ACA, to argue that if the mandate falls it must take all the rest of the Act with it. He began by emphasizing that the government agreed with him on one point: if the mandate falls, so also must two related provisions that require insurance companies to provide insurance to everyone, even sick people, at reasonable rates. But then he took that argument further, telling the Court that it would then need to strike down other provisions that were also related to the mandate. (He listed a series of such provisions in an approach that evoked the old children’s song: “The hip bone is connected to the thigh bone, the thigh bone is connected to the knee bone . . . .”) Because what would be left, he concluded, was merely a hollow shell, the better option would be to strike down the whole law and let Congress start over with a clean slate.
Clement had a tough sell not only with the Court’s more liberal Justices, but also with some conservative Justices. Several Justices pressed Clement on what test the Court should use to figure out whether the mandate can be severed from the rest of the Act. But Clement’s response – that the Court should look at the text of the ACA and whether it can operate as Congress intended without the mandate – led to additional questions about his description of the ACA without the mandate as a “hollow shell.” Justice Kagan suggested that many of the other provisions that Clement cited were not so connected to the individual mandate that they would have to fall too. In a line that needs no translation into Plain English, she added: “Isn’t half a loaf better than no loaf?”
Citing provisions from the ACA dealing with such wide-ranging topics as black lung disease, the Indian Health Service, breastfeeding, and providing doctors in under-served areas, Justices from both sides of the ideological spectrum asked Clement whether Congress would have passed at least part of the bill even without the mandate. Why should we make Congress start over from scratch, the thinking went, when there are so many parts of the ACA that have nothing to do with affordable health care?
Justice Sonia Sotomayor seemed especially reluctant to strike down any other part of the ACA if the mandate falls. Wouldn’t that, she repeatedly asked Clement, be a job for Congress instead? Clement, along with Justice Scalia, countered that gridlock might keep Congress from acting. And along a similar line, some Justices asked Clement to explain how, even if the Court were to take on the job of figuring out what other provisions could not survive, it would do so?
When Clement sat down, there did not seem to be five Justices who wanted to strike the entire ACA down if the mandate is found unconstitutional. Indeed, it was probably not a good sign for Clement that Justice Samuel Alito – whom Clement might have hoped to have on his side – asked him to provide his “fallback argument.” But when Deputy Solicitor General Edwin Kneedler, a career civil servant who has argued over one hundred cases at the Court, started his argument, he too faced tough questions, particularly from the Court’s more conservative Justices. Although Justice Ruth Bader Ginsburg returned to Justice Sotomayor’s suggestion that Congress was better suited to figure out what parts of the Act should survive without the mandate (a suggestion with which Kneedler agreed), Justice Scalia again pushed back. If Congress is going to have to reconsider the Act anyway if the mandate is struck down, he asked, why shouldn’t it do so on a blank slate?
Another question that Clement had gotten – how, if necessary, the Court should try to figure out what should stay and what should go with the mandate – also resurfaced in Kneedler’s argument. Kneedler responded with what seemed like a fairly straightforward solution, telling the Court that the ACA itself draws a “sharp line” that separates the mandate and two related provisions (requiring insurance companies to make insurance available to everyone at reasonable prices) from the rest of the Act. But some Justices – such as the Chief – remained unconvinced that such a “sharp line” existed. Nor did the Justices appear to relish the prospect of going through the entire 2700-plus pages of the ACA, line by line, to determine what provisions should fall with the mandate; indeed, in one of his many laugh lines of the day, Justice Scalia suggested that such a chore would violate the Eighth Amendment’s prohibition on cruel and unusual punishment.
Finally, Kneedler disputed Clement’s suggestion that striking down the mandate would go to the heart of the ACA. He countered that the ACA is “a huge act with many provisions that are completely unrelated to market reforms and operate in different ways.” And to illustrate his point that Congress did not intend to connect the whole ACA to the mandate, and would certainly not have expected it to fall with the mandate, he emphasized that many provisions in the ACA have already gone into effect, years before the mandate will. That argument, however, met with scorn from Justice Scalia, who admonished Kneedler that some provisions – such as the requirement that twenty-six-year-olds without insurance be allowed to stay on their parents’ policies – would “bankrupt the insurance companies, if not the states,” without the mandate.
With both the states and the federal government agreeing that some or all of the Act must go if the mandate does, the Court (just as it did for Monday’s argument on the Anti-Injunction Act) appointed a third lawyer to participate. H. Bartow Farr argued that the rest of the ACA can survive even if the mandate falls. In his opening remarks, Farr told that the Court that even if it strikes down the mandate, so that the ACA does not work exactly as Congress had intended, allowing the rest of the Act – including the two related provisions that the United States argues should be invalidated along with the mandate – to stay in place will still advance Congress’s goal of ensuring that everyone has access to care at reasonable prices.
However, the Justices were concerned that this outcome might cause the health insurance system to (as Justice Kagan put it) “crash and burn”: the less healthy people who cannot currently get insurance will buy insurance once the ACA goes into effect, but the healthy people who would not have to buy insurance without the mandate would not, putting a financial strain on the insurance companies because they would not be able to use those healthy people to balance out the risks and costs associated with the sick people. Farr sought to reassure the Court that this “death spiral” would not occur because (among other things) other incentives would bring the healthy twenty-six-year-olds into the health insurance market, but he did not appear to make much headway in addressing their concerns.
Farr may have had more success with his argument (echoing the thoughts expressed by some Justices earlier in the afternoon) that it would be harder for the Court to simply draw a “bright line” around the mandate and its two related provisions than the government would have it believe. And that argument, in fact, probably captures where the tea leaves were after the oral argument. It did not seem like five Justices of the Court wanted to throw out the whole ACA (although Justice Scalia certainly seemed to support that result), nor did it seem like the Court will agree with Farr that the rest of the Act can survive even if the mandate falls. The question before the Court, then, would be what else would go with the mandate? Will it limit itself to striking down the mandate and the two closely related provisions alone, or would it also conclude that other provisions with some relationship to the mandate must also go? And, if so, which provisions? If the Court concludes that the mandate is unconstitutional, we will find out the answers to these questions in late June.