Ruling that the federal health care law’s mandate to buy health insurance is a law about a tax but not about raising government revenue, the U.S. Court of Appeals for the District of Columbia Circuit on Tuesday rejected a new constitutional challenge to that key part of the Affordable Care Act.  The three-judge panel’s decision in Sissel v. Department of Health & Human Services can be read here.

Because the mandate was not designed primarily to bring in money to the Treasury, the court of appeals concluded, it was not a revenue measure that, under the Constitution, must have its legislative start in the House of Representatives.  The decision also rejected a renewed claim that the individual mandate was invalid because it exceeded Congress’s power under the Constitution — a variation of a claim that the Supreme Court turned aside two years ago.

The new ruling dealt with one of two new constitutional challenges to arise against the health care law since the Supreme Court in 2012 narrowly upheld the law’s most significant part.  The other challenge — seeking to sharply restrict access to government subsidies to help lower-income individuals buy health insurance under the mandate — succeeded last week in a separate ruling in the D.C. Circuit.  The Obama administration plans to seek rehearing in the subsidies case.

The challenge to the subsidies has been widely regarded as the more serious threat to the entire ACA, because the availability of those subsidies is necessary to make the entire health care insurance reform work in practice.  The challenge based upon the revenue-raising question has generally been thought of as a long shot.

The Tuesday ruling grew out of a challenge by an Iowa artist, Matt Sissel, who does not want to buy health insurance and thus faced a potential penalty for failing to do so.  The ACA’s individual insurance mandate, according to the Supreme Court interpretation in 2012, is enforced by a tax that Congress passed under its general taxing authority.

Under the phrase in the Constitution known as the “Origination Clause,” a federal bill to raise revenue must originate in the House, rather than the Senate.  In Sissel’s lawsuit, he contended that the ACA individual mandate was a revenue-raising bill — because it has the potential of bringing in about $4 billion in penalties for those who don’t obtain health insurance — and thus had to begin its Capitol Hill journey in the House.

The lawsuit argued that the mandate was something that originated in the Senate, because the Senate in 2009 took a House-passed bill dealing with something else entirely and used that as the vehicle to enact the massive new health care law, including the individual mandate.

The D.C. Circuit did not rule on whether, in fact, the mandate had originated in the Senate instead of the House, because it opted instead to rule that the measure did not even come under the Origination Clause because its purpose was to expand health care coverage for millions of Americans, rather than to raise federal revenues.

The court of appeals relied on a series of prior Supreme Court precedents — which, it said, stand for the principle that the Origination Clause applies only when the primary purpose of legislation is to raise money for the government, and thus does not reach a bill that only incidentally would produce some revenue.

Circuit Judge Judith W. Rogers wrote the opinion, joined by Circuit Judges Cornelia T.L. Pillard and Robert L. Wilkins.  The ruling could be challenged in a request for rehearing before the full D.C. Circuit or review by the Supreme Court.

In a separate part of Sissel’s challenge, he had argued that the individual mandate exceeded Congress’s power under the Constitution’s Commerce Clause.  He insisted that the Supreme Court had accepted that very argument in its 2012 decision in which it turned to the taxing power to uphold the individual mandate.

But the court of appeals said Sissel had misread what the Supreme Court had actually done on the Commerce Clause point.  The Court had not actually ruled on that point, even as it suggested that, if it had, it would reject it, the D.C. Circuit said.




Posted in Featured, Cases in the Pipeline, Health Care

Recommended Citation: Lyle Denniston, Appeals court rejects new test of health care mandate, SCOTUSblog (Jul. 29, 2014, 1:03 PM),