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Ask the author: Einer Elhauge on Obamacare on Trial

Einer Elhauge, the Carrol and Milton Petrie Professor of Law at Harvard and the Founding Director of Harvard’s Petrie-Flom Center for Health Law Policy, Biotechnology and Bioethics, wrote extensively and accessibly about the battle over the constitutionality of the Affordable Care Act.  His essays from the past year have been complied into a new book, Obamacare on Trial.  Below, Professor Elhauge kindly answers a few questions about the book.

QUESTION 1:  In several articles in the book you refer to the Militia Act, and two other pieces of legislation that serve as early precedents for the individual mandate to purchase insurance. For example, one 1790 law required large ships to either stock medicines or provide “all such advice, medicine, or attendance of physicians, as any of the crew shall stand in need of in case of sickness” and to do it “without any deduction from the wages of such sick seaman or mariners.” This law was later expanded in 1798 to require shipmasters to pay twenty cents per crew member (which could be withheld from the sailors’ paychecks) for each month at sea “to provide for the temporary relief and maintenance of sick or disabled seamen, in the hospitals or other proper institutions now established” – a requirement that was, as you characterize it, very similar to an individual mandate to purchase health insurance.

In 1940, only nine percent of Americans had health insurance, but thirteen years later sixty percent did.

Given the very different experiences in our nation’s history, what constitutional principles should we consider in determining whether a purchase mandate is “proper”?

ANSWER 1:  I think the basic source of constitutional principles should turn on inquiry into the text, history, and precedent.  On the issue of whether the Commerce Clause authorizes a federal purchase mandate, the problem was that the challengers struck out on all three points.  The text just says that Congress can “regulate commerce,” and dictionaries in the 1780s defined “regulates” to include either prohibiting or requiring something, so the plain text indicated that Congress could require commerce.  The legislative history was silent in the sense that no one during the Constitutional Convention or ratification debates ever discussed the topic one way or the other.  And the closest legal precedent was Wickard v. Filburn, which held that Congress could regulate a noncommercial activity (growing wheat for self-consumption) because doing so would encourage purchases, namely buying wheat from others.  The Court reasoned, “The stimulation of commerce is a use of the regulatory function quite as definitely as prohibitions or restrictions thereon.”  This language directly indicated that Congress had just as much power to induce commerce as to restrict commerce.

So the entire challenge rested on the premise that, notwithstanding this lack of text, history, or legal precedent for a constitutional prohibition on federal purchase mandates, we could infer that the Framers must have intended to prohibit such mandates from the fact that they were in practice unprecedented.  This logic is itself flawed because it amounts to adding an anti-innovation clause to our Constitution despite the lack of any text or Framer intent supporting an anti-innovation clause.

But the simpler flaw with the challengers’ claim was that their premise was entirely false: federal purchase mandates were not at all unprecedented.  In 1790, the very first Congress (which included twenty Framers of the Constitution), enacted a law requiring shipowners to buy medical insurance for seamen. That law was signed by another notable Framer, President George Washington.  Congress followed this with a 1792 law requiring all able-bodied citizens to buy a firearm, and a 1798 law requiring seamen to buy hospital insurance for themselves.   The fact that our Framers were willing to mandate the purchase of health insurance back when health care was far less prevalent and indeed far less helpful (until the 1900s, health care probably caused more health problems than it cured) cuts even more strongly in favor of the conclusion that a health insurance mandate is constitutional today.
QUESTION 2:  In your book, you write about two amicus briefs filed by economists on opposing sides, and you note that the Court could have started from the premise that the Act’s nondiscrimination provisions – which require insurance companies to cover people regardless of their medical history – are valid under the Commerce Clause.  From that conclusion, the Justices might have upheld the mandate under the Necessary and Proper Clause because, as a matter of economics, the nondiscrimination provisions could only be economically feasible if everyone were required to purchase insurance.  The Justices are of course trained in the law, rather than in economics. In situations like this, in which economic and constitutional theories overlap but do not necessarily do so in obvious or easy-to-understand ways, how important is it to get the economic questions, in addition to the legal questions, right?

ANSWER 2: I think it is very important that Justices do not screw up the economics when they are deciding important issues of national economic policy like the massive regulation of health care at issue in the Obamacare case.  However, here I think the legal issue was quite simple because (1) one does not need any fancy economics to realize that one could simply reverse the order of analysis and (2) no one really disputed the vital connection between the mandate and the nondiscrimination provisions. Indeed, the challengers argued that precisely because of that vital connection, the mandate was inseparable from the nondiscrimination provisions. That same vital connection indicated that the mandate was necessary and proper to adopt the nondiscrimination provisions.

Also, the fact is that prior cases had held that a statutory provision could be necessary and proper to the exercise of a constitutional power as long as there was a rational relationship between the two. No one doubted that there was at least a rational relationship between the mandate and the clearly constitutional nondiscrimination provisions.  The Supreme Court ended up deciding that even if the mandate was “necessary” for the nondiscrimination provisions, it was not “proper” because the mandate was not itself authorized by the Commerce Clause. But that sort of approach is inconsistent with the Necessary and Proper Clause generally, which is all about providing a source of authority for provisions that are not directly founded in other constitutional clauses but that help execute the powers vested by those other constitutional clauses.  For example, although the Constitution does not give Congress the power to enact criminal laws, the Supreme Court has nonetheless held that Congress can pass criminal laws to prevent interference with the post office because another clause gives Congress the power to establish post offices, which thus makes criminal protections necessary and proper to exercising the postal office power. More specifically, the Court’s approach is inconsistent with the approach that Justice Scalia himself used in Gonzales v. Raich, where he held that even if the Commerce Clause did not directly allow the regulation of growing marijuana for home use, such a regulation was necessary and proper to advancing Congress’s power to regulate commerce in marijuana.

QUESTION 3:  Throughout your commentary, but in two essays particularly, you have questions about the framing of this case. You first suggest that the government should have been clearer all along that the Affordable Care Act did not change the relationship between the government and individuals, because Congress had mandated purchases in the past.  But you note, however, that the government had to be careful because no one wants to hear that Congress has the power to mandate broccoli purchases, which you say it does. Moreover, you suggest, the government could have reframed the “freedom not to purchase health insurance” as an economic issue that forces some individuals to pay for others.

On the other hand, some economists have strongly opposed universal insurance, arguing that insurance created a “moral hazard” by potentially changing the behavior of the insured and driving up costs. As this argument goes, everyone’s insurance premiums will go up to accommodate the increased overall consumption of health care, thereby shifting the social costs from paying for the uninsured to paying for the unnecessary.

If the government had to navigate between the Scylla of mandated broccoli purchases and the Charybdis of moral hazard, how much more room to reframe the government’s position did it really have?

ANSWER 3: I think the government should have directly confronted the claim that purchase mandates were unprecedented and the broccoli hypothetical in particular, rather than hoping to avoid those issues. As a matter of litigation strategy, the problem is that if you do not directly confront the biggest problems with your case, you let your opponent frame those issues in the way most advantageous to them.  Here, there were two simple points the government could have made. First, in fact, purchase mandates were not all unprecedented, but rather enjoyed a long lineage that went all the way back to the Framers, including on the very topic of health insurance mandates. Thus this purchase mandate did not change the relationship between the individual and the government in the way that Justice Kennedy thought put the burden on the government.  The burden should have been on the challengers to explain why this mandate was worse than past mandates.  On the broccoli hypothetical, the government should have directly refuted the challengers’ logic that a constitutional power should be limited by judicial fiat whenever one can imagine that the power could be used in silly ways.  I would’ve said, “It is equally true that power to prohibit commerce could be used to enact silly laws like a ban on buying broccoli or health insurance for that matter.  No one thinks that therefore judges should insert a ban on congressional regulations prohibiting certain forms of commerce. Likewise, one cannot infer from the fact that a broccoli mandate is silly that Congress lacks the power to mandate other purchases that are not silly.  Every congressional power could be exercised in stupid ways, but our constitutional remedy for this is not having judges second-guess the political process, it is our constitutional right to vote out legislators who vote for stupid things.”

On the freedom issue, I was simply pointing out that under a pre-Obamacare law enacted during the Reagan Administration, hospitals are already required to cover healthcare for the uninsured even when they cannot pay for it, and the source of money that hospitals use to do so comes from the insured.  So under pre-Obamacare law we already had a mandate; it was just imposed on the insured rather than on the uninsured who were getting the care. So I would’ve continued the last statement by saying, “Moreover, there was already a mandate to cover the uninsured, it was just imposed on the insured rather than on the uninsured.  So this case is not about whether Congress can impose a purchase mandate, it is about whether Congress can change who bears the burden of that mandate by shifting it to those who receive the benefits of the healthcare.”

QUESTION 4:  In the last two essays in your book, you discuss how the Chief Justice got the right result (upholding the ACA) but for the wrong reason (not upholding it under the Commerce Clause). You contend that the portion of the Chief Justice’s opinion upholding the mandate as a tax actually undermines his conclusion that the Commerce Clause does not apply because he “reasoned that Obamacare really imposes a mandate only on those subject to its tax penalty – which is limited to those who have thousands (probably tens of thousands) of dollars in earned income.”  What he “seems to have missed,” you continue, “is that you cannot have earned income without engaging in Commerce.”  How big of a problem is this for the Court’s Commerce Clause jurisprudence, going forward?

ANSWER 4:  I don’t think it is a huge problem for Commerce Clause jurisprudence in particular, because the issue here was really just an obligation to pay money for something, and under the court’s own logic Congress can always do that in the future if it is just careful to either fashion the obligation as a tax or to explicitly condition the mandate on whether the individuals are engaging in some other form of routine commerce.  Indeed, this is another reason that this case was never really about changing the relationship of individual and government — even under the challengers’ own logic, Congress can functionally do precisely the same thing if it just uses different words.  The problem going forward is twofold.  First, the near-death experience in Supreme Court continues to fuel opposition that is partly based on the notion that Obamacare is at least constitutionally suspect and thus illegitimate even though technically legal, which may affect important issues like the willingness of House Republicans to appropriate funds to implement Obamacare.  Second, the constitutional methodology that the Supreme Court used portends a potentially huge expansion in the judicial power to overrule the political branches, because it included (a) ignoring inconvenient dictionary definitions, history, and precedent and (b) the creation of a new judicial power to insert new “limiting principles” to constrain congressional powers whenever judges can imagine that the power might be used in ways that the judges would find silly, even though those “limiting principles” themselves have no support in the Constitutional text, history, or precedent.  This “limiting principles” methodology itself has no limiting principles and could produce a vast unwarranted expansion of judicial power.

Recommended Citation: Kali Borkoski, Ask the author: Einer Elhauge on Obamacare on Trial, SCOTUSblog (Nov. 12, 2012, 2:26 PM),