Health Magazine

The Moderate's Manifesto: The Constitution and the Individual Mandate for Health Insurance

Posted on the 31 March 2012 by Realizingresonance @RealizResonance


Photo courtesy of iStockphoto.

This week the US Supreme Court heard arguments challenging the constitutionality of the Patient Protection and Affordable Care Act (PPACA), with the strongest challenge in regards to the individual mandate. The Court heard testimony over three days, the longest time spent on a case in about 40 years. The political atmosphere is very charged over this, and the belief that ‘ObamaCare’ is unconstitutional is nearly absolute among conservatives. As a moderate independent who has a leaned libertarian in the past, I have mixed feelings about the individual mandate as a practical and a political matter, and up until now I have not focused too closely on the legal arguments against its constitutionality. Now that I have heard the arguments, I believe that the individual mandate is constitutional, no matter what I think about it otherwise.

As far as I can tell, the primary legal arguments against the individual mandate, a provision in Obama’s new healthcare law which requires all people to purchase healthcare or pay a penalty, are 1) that the power of the Federal Government to regulate commerce is limited and does not extend to compelling all citizens to make particular purchases, a regulation of inactivity not activity, 2) that the law represents an unprecedented shift in the power balance between the federal government and the individual, and 3) that this expanded interpretation of the Federal commerce power has no logical limit. While these arguments are persuasive political and rhetorical arguments, which strike at the heart of the American libertarian spirit and a certain sentiment about limited government and individual sovereignty, I don’t think they actually demonstrate the unconstitutionality of the individual mandate.

The legal arguments in support of the law’s constitutionality are that it is valid under the Commerce Clause and the Necessary and Proper Clause in Article I of the Constitution, which enumerate the powers delegated to Congress. The Congress has the power “to regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes”, and “to make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.” If the healthcare law is intended to regulate national commerce and has a rational basis in its application to this intention, then the power to declare an individual mandate to obtain heath insurance appears well within the power of Congress to do.

Enumerated powers to the federal government must have limits that balance power between the states and individual citizens. However, I don’t find a limitation on mandating purchases, or an individual right that frees citizens from being compelled into market transactions. In fact, I think that the distinction between compelling all citizens to purchase a product and compelling all citizens to pay taxes, which are then used to fund government services, is an arbitrary distinction in practical experience. The limitation on the Commerce Clause in regards to the individual mandate is far from clear in the text of the Constitution itself, and requires a Justice to read into the text their own ideological presumptions.

A primary argument seems to be the slippery slope argument, that a parade of horribles may be sanctioned if the precedent of the individual mandate is upheld, such as mandates to eat broccoli, purchase mobile phones, or gym memberships. This line of reasoning seeks to show that there would be no limit to federal power over individuals if a healthcare mandate were enforced. These extreme hypotheticals are interesting to ponder philosophically, and for developing Constitutional doctrine, but I don’t think that they are legally determinative here, in the sense that these are not the Constitutional questions truly at hand. The parade of horribles is an attempt to avoid the particulars of healthcare and insurance markets and national market implications, and instead transforms the Constitutional test into one of vague abstractions and principles.

The arguments against constitutionality are politically persuasive, especially the argument that this could represent a large power shift between the federal government and the individual, but they side-step the words of the Constitution and impose a test against an interpretation of the Constitution’s spirit or general purpose. While I believe that the spirit of the Constitution is a legitimate concern, I think it is more appropriate a topic of debate among the body politic and their representatives in the Legislative Branch. Also, I agree that tests of constitutionality should be measured against the entire text rather than isolated clauses, since more than one section may govern a particular question, but the deference to the spirit or goal behind the actual text, such as the general sentiment that the Constitution is intended to limit federal power, is to read ideological content into the text which is not actually there. I believe The Supreme Court should be looking at this issue more narrowly. Limitations on power apply to all Federal branches, and the Justices role should be limited to deciding whether the individual mandate pertains substantively to interstate commerce, or not. That’s it.

If an economically substantive portion of healthcare costs are being passed off onto voluntary consumers of health insurance, because of the healthcare consumption of uninsured consumers, in the form of free riders and higher premiums nationally, then it falls within the regulation of interstate commerce and the individual mandate is constitutional. But if the citizens who choose to forgo health insurance truly have no effect on the national healthcare and insurance markets, no effect on the costs of those citizens who have purchased health insurance, then the individual mandate is at attempt to regulate inactivity only and is unconstitutional.

In the end the question comes to that of inactivity. Is being uninsured the same sort of market inactivity as not eating broccoli? I don’t think so. Because the market for health insurance is attached to the market for healthcare, this is not a normal free market situation. When we think of free market transactions, we think of them as being about purposeful choices by individuals to satisfy wants, and it is intuitive and desirable that for the most part we should all have the liberty to decide how best to spend our own incomes. However, if someone gets hurt or sick, and does not have health insurance, they do not have the option to purchase health insurance at that moment that they need it, and the suppliers of healthcare do not have the option of turning away those in need. Furthermore, the need for healthcare is inherently unpredictable, even if generalized groups of market participants can be lumped together by propensities, and the risks of nonparticipants in the market are born as negative externalities by the insured participants in the market and the national more generally. This does not reduce simply to inactivity without rhetorical distortion.

As a moderate I am not arguing for the individual mandate on any other grounds beyond the rational connection to national commerce. I think this connection is obvious on logical and empirical grounds. ObamaCare does not regulate inactivity of individuals, but it does regulate a national market that all Americans will inevitably participate in at some point, and the timing of this participation is not predictable by the individual, so that self-insurance represents a risk that is spread to society at large. The burden on those who oppose this mandate on constitutional grounds is to show evidence that uninsured people never need healthcare, and since we all know this kind of evidence does not exist, the opponents of healthcare distort the test into a more abstract and less concrete question about limited government power and individual liberty ambiguously declared.

As a moderate, I also don’t necessarily like the idea of an individual mandate as a solution to our healthcare challenge, and I am not sure about it on economic, moral, or political grounds. The possibility of unintended consequences seems fairly high to me, it is a definite power growth at the federal level, and the political conflict over this issue is divisive enough for an independent like myself to want to stay on the fence for the sake of a settled compromise between Americans on a suitable healthcare system, no matter how much of a chimera that may seem. I am as conflicted inside about what to do to fix healthcare as the citizenry at large is, and my sentiments on this are both rational and emotional. However, when it comes to questions about the Constitution, I want the Supreme Court to focus narrowly and rationally on the question so that they don’t end up supplanting the role of elected representatives in Congress to debate and vote on legislation that attempts to solve national problems.

Jared Roy Endicott

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By redp1800s
posted on 07 April at 04:08
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I agree with most of your premise that we need to be arguing the singular application of this new healthcare policy.

I also believe the reason the healthcare industry wants to make certain this never gets fully implemented is because of the standard that 80% of the money taken in has to be applied to the insured and not arbitrarily set by the insuring agencies like they are now. They don't want to lose their huge bonuses for not allowing individuals to get services they paid for, but were loosely worded in the initial contract enough for them to be denied the ability to get needed healthcare services.

It's a slippery slope, but we need to have a national standard that will allow all members of our nation to purchase affordable services and treatment so that the middle 30 percent of those insured don't have to pay exorbitant prices for their healthcare. We can't afford to let the costs of healthcare go completely beyond what 90% of our citizens can afford. We also can't continue to allow private institutions to pick and choose who they will cover and who they won't. That's called "cherry picking" the very best and leaving everyone else to fend for themselves.

Let's hope that one of the Supreme Court Judges from the 'conservative' side understand what is at issue here and makes a moral decision to stand for what is right and just in America. Time will tell what actually becomes of this issue.