A Nonpartisan View of the Uncivil Wars Over Health Care Law and How They Have Affected the Three Branches of Our Government, Particularly the Self-Inflicted Wounds of the Supreme Court
By Alvin D. Lurie
Casualties of the Wars
The uncivil wars waged over health care reform legislation have riven the foundations of the institutions of our Federalist system of government into warring camps—not just between the three bodies, but within each of them, and even within the blocs that comprise the separate cohorts within the discrete branches of government. Ergo, the scars run deep within the system. These battles have engendered great animosity among the participants, that have damaged the institutions in ways that have, at the least, greatly damaged their prestige and authority to perform their responsibilities, but—more seriously—have diminished their ability to carry out their Constitutional duties to govern, to legislate, and to adjudicate. This has directly translated into growing disillusionment—even malaise—by the public concerning the working of our government—indeed, a shrinking of the sense of exceptionalism that had characterized how Americans viewed their country for most of the 20th century and into the first couple of years of the 21st preceding the calamitous 9/11 attack.
In this atmosphere the legislative function has been the most abused, resulting not just in dysfunction, but in no-holds-barred tactics that all too well demonstrated Bismarck's oft-quoted aphorism that, aside from the making of sausages, the thing one most wouldn't want to see is the making of legislation. Over two years since enactment of the Affordable Care Act, stories continue to emerge of the White House buying votes with favors to hold-out Congressmen and, most recently, actually selling very valuable business advantages to the pharmaceutical industry in return for multi-million dollar contributions to the financing of the Administration's advertising campaigns to win support of enactment of the health bill. That's not just business as usual. It calls for a robust response, if our democracy is not to fall into the same gutter where the worst abuses of some of the "developing" nations are cavalierly practiced.
The battles have not ended with the passage of the Affordable Care Act in March 2010, or with the midterm elections in November 2010, or with the momentous decision of the Supreme Court upholding the constitutionality of the law in June of this year; nor are they likely to end with the elections in November. In fact—depending on the outcome of the Presidential and Congressional elections—this might even recharge the efforts of Republicans to reignite the flames of war in order to reverse the judicial resolution of the legality of a law that, according to recent polls, continues to be unpopular with the majority of American individuals.
Opposition to the law is taking hold among businesses—particularly smaller ones—already burdened by a large regulatory hand, with consequent growing compliance costs, that will only escalate when the full requirements of the law and the flow of accompanying regulations progressively become effective. Also, one can assume, the 26 states that brought and lost the cases challenging the constitutionality of the health reform law—and others besides the original 26 that are now confronting the insurance exchange requirements and expanded Medicaid coverage imposed on states under the law—are among opponents to the new law.
That is not to say the law is wholly without redemption. On the contrary, there is very much to commend it. But in its 2700 pages, and many multiples of that figure that the regulations of three separate federal agencies having regulatory jurisdiction of the law have already placed in the Federal Register—with many multiples of that still to come as effective dates continue to occur until 2018—the hand of Big Government has already fallen heavily on business, individuals, vendors and consumers of health care, the states, and even the ever more burgeoning federal bureaucracy itself. The price to be paid by the country at large for all this cannot be ignored. Serious efforts must be made to capture the key benefits of the present ACA while tempering its frightful excesses and budget-busting costs for government, business and individuals. This must be bipartisan solution, or the jockeying between the parties will continue indefinitely.
Halting Ever Rising Health Care Costs
An important source of disenchantment with the law is its failure to deal effectively with the very thing that prompted the health reform legislative initiative, concern with nose-bleeding rises in the cost of delivery of health care that were absorbing ever larger percentages of the gross domestic product and of the federal budget. Economists debated whether the ACA would actually stem this trend, let alone cut medical costs. The Congressional Budget Office, which during Congress' deliberations on the law's economic impact provided 10-year projections that supported substantial cost savings and deficit reductions, has since revised its previous optimistic estimates substantially. In a report issued a month after the Supreme Court decision the CBO has announced that it now expects the health reform to compel the government to spend more money, to raise more tax revenue, and to reduce the deficit less than it estimated in 2010 just hours before Congress passed the ACA, and it cautions that things could get worse.
The CBO is not the only government agency reassessing health care costs and concluding that they will be higher. Massachusetts, the state that led the way for health care reform by enacting in 2006 the model for the federal health care reform legislation, has very recently enacted the first-in-the-nation bill to limit the growth of health care costs in its state. Under the bill passed by the legislature and signed by the governor, spending would be capped not to grow faster than the state's economy through 2017, and, for the five succeeding years, not to rise more than a half percentage point lower than the increase in the state's gross domestic product. Whether the federal law remains intact or is replaced by a modified version, legislation to rein in health care costs must be a necessary component of future federal health policy. It would provide a perfect vehicle for Washington to relearn the art of bipartisan legislating for the Nation's good.
Tax Increases Geared To ACA
There is another element of increased cost to the public associated with Health Reform that has slipped under the radar screen largely unnoticed. There has been much comment in the Obama campaign stump speeches and the press about raising taxes on the super-rich (a group in which the President invariably includes himself for his own reasons), much of it billed as the Buffet Plan because the Sage of Omaha certainly gave the idea a strong boost when he volunteered last year that his tax rate should at least equal that of his secretary. But there has been scant mention of taxes included in the ACA itself that are specifically designed to raise revenue for the federal government to partially offset its costs of providing benefits and subsidies stemming from the health reform law itself. These revenues will come from a new 0.9 % Medicare tax on annual wages above $250,000 for married couples and $200,000 for singles, and an additional 3.8% on investment income (on top of the existing capital gains tax). The Congressional Budget Office projects those revenues to come to $318 billion over the next 10 years, and, when added to other levies on specific health-care related businesses (drug companies, medical device makers and insurers) and other miscellaneous targets (e.g., a 10% tax—tax or "penalty"?—on tanning booth users), could top $675 billion over the 10-year period.
The purpose of mentioning these taxes here is not to argue the merits of such revenue-raisers, or their selective targeting of upper-bracket individuals and health-related businesses, but to include relevant economic data to be taken into account in appraising the Affordable Care Act, which, of course, is why the CBO has developed the data. That is not to say that the next court challenge to the ACA might not come from some creative tax attorney arguing that the 3.8% tax was an unauthorized inclusion in the health law inasmuch as it did not initiate in the tax-writing committees of Congress (assuming that to be the case). [Author's Disclaimer: That is not to be taken as a serious recommendation of a tax position that can be asserted.]
Fractured Supreme Court
Far from setting to rest the contentious issues that the Supreme Court decided, its recent decision has further roiled the waters, largely because of the problematic reasoning on which the 5-to-4 majority rested its upholding of the principal issue, the insurance mandate—dismaying critics of the mandate, but disturbing even some who favored the result (notably Madam Justice Ginsburg, as will be observed below)—for the Court's reliance on the taxing authority of Congress, even in the face of the majority's acknowledgment that the Congress had deliberately refrained from exercising its taxing power to enforce that mandate. No amount of resort to semantics or reference to a lexicon for multiple meanings of a word can overcome the words Congress employed in enacting what it called a "penalty" to carry out its intentions. As the dissenting opinion puts it in such plain English:
"[A] regulatory mandate enforced by a penalty could have been imposed as a tax (italics in the original) [and vice versa]; (b)ut we know of no case, and the Government cites none, in which the imposition was, for constitutional purposes, both. The two are mutually exclusive."
As we shall see below, the majority in fact held it was both a penalty and a tax, obviously contradictory conclusions, but each required to satisfy discrete issues bearing on the case, and both necessary for the Court to reach its decision sustaining the constitutionality of the statute. That shall be amplified below.
There are also other troubling aspects of the Court's decision-making in this case that are noted below and that detract from the stature of the decision as a "leading case", thus impairing its precedential value in undergirding the legitimacy of the Affordable Care Act. At least some of these problematic elements will inevitably lead to future challenges to different features of the law, permitting reconsideration of past conclusions by the Court, with resultant continuing uncertainty as to the law's full reach. For these reasons, repeal of the present law by the next Congress and its replacement by legislation arrived at by bipartisan cooperation—which did not exist in passage of the present law and would greatly improve prospects for widespread public support of health reform such as does not prevail at present—could be an unexpected blessing by providing an opportunity to rewrite the troubled history of the health care legislation.
For a case of such overarching importance—easily the most important socially significant case in decades—that commanded the attention of the eyes and ears of an exceptionally large number of court-watchers among the public, and hordes of journalists, editorial writers and op-ed columnists, economists, essayists in journals of opinion, TV talking heads, and uncountable numbers of the new electronic breed of homegrown writers of blogs, that followed every twist and turn of the litigation, and waited with collective bated breaths for the Court's announcement of its decision, one would have expected every step in the process to be finely honed and managed minutely to fit firmly within long established protocols and precedents, drawn from the Court's own experience in many thousand cases, that would have informed the actions of all the principal players (not least the President). Such was not the case.
In actuality there were a surprising number of unexpected and novel elements associated with the case—from the Court's agreeing to grant certiorari and to decide the matter in the very midst of the upcoming November election season, to its stipulating an unusually prolonged three days of oral argument (compared with the usual one hour for each side) , to the Court's appointing its own "friends of the Court" (amici curiae, in the jargon of trade) to argue for two propositions that the Court wanted to hear discussed by private attorneys of its own choosing (notwithstanding an unprecedented number of amicus briefs—well over 100—filed by interested segments of the public), to the President's announcing at the conclusion of the arguments how the judges (an "unelected group of people", he called them) would decide the case, to a bizarre turn in the decision-making in the Justices' chambers that followed the arguments, and then to the announcement of its decision, which found the Court not just closely split in a startling way, but, it can be said, fractured into different alignments on different issues, making it very difficult even for experienced court observers to ascertain which Justices made up the shifting majorities for each of the several issues that were decided, and, for that matter, how to count the respective majorities.
It is generally said that the decision was split 5-to-4; but while that is correct as to the key issue of the constitutionality of the so-called insurance mandate, there were other issues subsumed by that overriding issue, such as the question whether the Commerce Clause of the Constitution supplied that prop, on which there were different line-ups of the Justices, producing 7-to-2 and 6-to-3 splits. For example, Justice Ginsburg concurred that the statute was constitutional, but she strongly demurred from the majority opinion's finding that the Commerce Clause would not support that conclusion. However, she was content to accept the alternative taxing authority foundation for the majority opinion. The four dissenters were not. They also agreed with the majority opinion's rejection of the Commerce Clause; so they contended that the statute lacked any constitutional support.
Sorting all this out would require close reading of the majority decision that ran 59 pages, the Ginsburg concurrence 61 pages, and the 4-judge dissent 65 pages. There was also a separate one-paragraph dissenting opinion by Justice Thomas, to express his general observation about why the Commerce Clause was even less supportive than would be concluded from the precedents cited in the joint dissenting opinion. An entirely separate issue (not otherwise mentioned in this article) pertained to the substantial optional expansion of Medicaid benefits provided by States under the ACA, the specific question being a penalty imposed on States opting not to provide the expanded coverage, which found the Justices in a completely different alignment, with seven members overruling the ACA penalty.
Linda Greenhouse, writing four years ago when she was the Supreme Court reporter for The New York Times, captured this fiercely independent spirit of the nine individuals who then (and, with recent replacements, now even more) often demonstrate this quality, in these few trenchant words:
The court is by nature an atomistic institution, its actions the aggregation of determinedly individual decisions.
Elements Undercutting Authority of Case
There are several elements that have a potential for undercutting the importance of the Court's decision as legal authority, let alone its standing as a "leading case", that cannot be ignored in any consideration of the case:
Roberts' Remarkable Ruling
The aforementioned reports of Chief Justice Roberts' strategic move were reenforced by the rather curious, albeit legally adroit, means by which he, writing the majority opinion on the central constitutional issue, upheld the health law not on the basis of the Commerce Clause, which is where its defenders (including the Solicitor General arguing the case for the Administration) believed the argument's emphasis should be placed, but on the taxing authority of Congress, which was merely the fallback position of the Administration. This tactic was a legal ploy accomplished by Roberts having straddling the tax question so as to hold, first, that the exaction imposed by the statute to enforce the insurance mandate—which the ACA calls a "penalty" (by reason of the deliberate intent of its drafters, presumably at the command of the Administration, to avoid its being considered a tax)—was not a "tax", which was a necessary precondition to prevent its being trapped by the Anti-Injunction Act, that would have precluded the Court from dealing with the case at present and not before the penalty was payable commencing in 2014 (a delay that the Court and its Chief obviously did not want or certiorari would not have been granted in 2012).
But, having gotten by the Anti-Injunction Act, Roberts went on to hold, writing for the majority, that it was a tax within the ambit of Congress' constitutional taxing power, notwithstanding that Congress had said it was not imposing a tax. This bifurcated assignment of meaning to the word "tax "would have been an admirable piece of lawyering and rhetoric if so important an issue as the Nation's health did not ride on such verbal atom-splitting. The double-edged wordplay could not fail to confuse the public, that might see it as legal trickery—not a quality that would endear the Court to the public or command respect for its opinion so constructed.
The even larger question is whether it is appropriate in this case to sustain the legality of so important a matter as health reform on such a thin reed. Roberts himself acknowledges in his opinion that the key provision in the statute, the insurance mandate, "reads more naturally as a command to buy insurance than as a tax." His holding is rife with the potential for reconsideration by the Court when future legal challenges are directed to any of the scores of other provisions of the ACA that almost certainly will occur in due course, and that can bring down the entire law if the challenged provision is held non-severable. Point I of an appellant's brief that can be anticipated could read: THE ACT MUST BE RULED UNCONSTITUTIONAL IN ITS ENTIRETY BECAUSE ITS CONSTITUTIONALITY RESTS ON A PROVISION WHICH THE CHIEF JUSTICE OF THIS HONORABLE COURT HAS SAID MORE NATURALLY CAN BE CONSIDERED SOMETHING THAT IS NOT A TAX.
Roberts' Unclaimed Opinion?
It is rumored there is another Roberts opinion in this case that is not signed by him. It actually appears in the reported decision as the opinion of "Scalia, Kennedy, Thomas, and Alito, JJ., dissenting." The authorship of the dissenting opinion is thus not credited individually to any of those four, as would normally occur for any opinion, with the other three who joined the opinion identified only as "concurring." In this case the dissent opinion is collectively attributed to all the dissenters, no one of them singled out as its author. Justice Ginsburg, in her opinion (concurring in part with the majority and dissenting in part), refers to the 4-judge dissenting opinion as a "joint opinion." That is an unusual characterization. The rumor is that it was to be the majority opinion striking down the ACA, written by the Chief Justice before he switched to the bloc upholding the law; and, the rumor goes, the Scalia group then took over his draft and turned it into their joint dissenting opinion. I do not vouch for that; but, were it true, it would explain why none of the dissenters could claim authorship of the "joint"—but not individually authored—format employed by the dissenters.
The mere suspicion as to the possible origin of the joint opinion would comprise another element bearing on the standing that will be accorded in some quarters to the (presumably later) contrary opinion Chief Justice Roberts actually filed for the "majority." Further diminishment of that opinion can be found in the separate Ginsburg opinion that she filed in "concurring "with the majority, in which she pulls no punches in criticizing in bold prose her Chief's opinion, that she repeatedly calls "the opinion of the Chief Justice", not the more customary "opinion of the majority." At one point she even withholds a reference to his decision as an "opinion", calling it "THE CHIEF JUSTICE's Commerce Clause essay"(capital letters in the original).
In one of her opening paragraphs, criticizing Roberts' refusal to sustain constitutionality of the insurance mandate on the basis of the Commerce Clause, she writes: "This rigid reading of the Clause makes scant sense and is stunningly retrogressive." No less stunning is the bluntness of her language in this and other pointed prose passages where she expresses her strong disagreement with the majority decision notwithstanding her concurrence, calling it a "crabbed reading of the Commerce Clause (that) harks back to the era in which the court routinely thwarted Congress' efforts to regulate the national economy in the interest of those who labor to sustain it."
The so-called "joint opinion" is even more strident, if possible, in its criticism of the Roberts opinion (although it does at least observe the convention of calling it the opinion of "the Court"). It says, in the following short sample of its indictment of the majority opinion:
If Roberts hoped to find comfort in the bosoms of his colleagues for his conversion of conscience to the liberal bloc in this case, he must have been sorely disappointed. A story in the press claims he first told his fellow Justices of his contemplated move some time after the oral arguments. One can only imagine their shock. The public shock came some time later, on the Court's "decision day" (the final one of the Term just ended in June).
When CNN Blew The Call
Even CNN, with its vaunted staff of snoops, did not learn of the Roberts switch until its Court reporters were well into their reading of Roberts' 59-page opinion for the majority of the Court. Anxious to steal a beat on the competition, their reporters, after only scanning the first couple of dozen pages, flashed the word to their newsroom.—which in turn quickly flashed the word to the TV world—that the Court had struck down the law, when in fact it did just the opposite. The Court had only eliminated the Commerce Clause as the source of the law's constitutionality, as described above.
The opinion does not get to the taxation clause on which its holding is bottomed until page 31 of the slip opinion, and it then works its way through almost nine pages of analysis of the precedents cited in the opinion before reaching the crucial sentence: "Our precedent demonstrates that Congress had the power to impose the exaction in §5000A under the taxing power, and that §5000A need not be read to do more than impose a tax." How that equivocal rationale in the case, that bears the title National Federation of Independent Business et al. v. Sebelius, Secretary of Health and Human Services, et al., on which Roberts posits his upholding of the constitutionality of the Affordable Care Act, will hold up in the jurisprudence of later case law of the statute may not be known for some time. Of course, before development of that body of law can occur the next Congress may have administered the coup de grace to the statute.
Members of The Tribe—or A Tale of Two Men
The full story of the evolution of the Roberts conversion is yet to be told. (No doubt CNN would love to be the network to break that story, to partially compensate for its blunder in reporting his opinion.) One straw in the wind that may provide an explanation of his seemingly inexplicable swing to the left to save Obama's ACA—even to the point of suggesting the source of his reliance on the taxing authority for the grounding of his opinion—is possibly to be found in a Newsweek piece in the July 16th (2012) issue by Professor Laurence Tribe of the Harvard Law School. It discloses that, in one of history's quirks, Roberts and Obama were both members of the same tribe at Harvard, that is Prof. Tribe's Constitutional Law classes, although not classmates since 12 years separated their matriculations. Tribe reveals that in his classes he espoused the views that (i) "Congress can properly use the taxing power to regulate behavior" and (ii) the "well-established legal principle that...the Supreme Court should make every effort to uphold an act of Congress whenever fairly possible."
The professor certainly seems to be suggesting, not too subtly, that those "Tribal" concepts had somehow stayed indelibly with the young Roberts for 35 years and were in his head during the National Federation oral arguments when Roberts asked the question whether one could sensibly call the insurance requirement a "mandate" when the only consequence was payment of a modest increase in federal tax owed. (I might interject here the observation that a speeding ticket is not more a tax than a mandate to drive safely because the only consequence of a first or second offense is payment of a modest charge to the locality.) Returning to the professor's narrative, he goes on to say that, on hearing Robert pose that question, "(t)hat was the moment I started thinking that the chief justice might well cast the decisive vote to uphold the mandate as an exercise of the taxing power"; and Tribe asserts that he predicted as much "when few others expected either that outcome or that line of reasoning."
He certainly seems to be building some kind of a case for a Harvard connection with the development of the Roberts thinking behind his pivotal rationale for upholding the ACA; but lest one think that's where Tribe was going in his recital, in the Newsweek essay, of the discussions of the taxing power in his teaching of the future chief justice, Tribe then goes on to disclaim "any reason to imagine that Roberts recalled anything in particular from the constitutional law course he took with me 35 years earlier." But he then dilutes his disclaimer by adding, "The man has a prodigious memory"; and he concludes by observing that his "two most influential former students...(had) an intertwined narrative of disparate but intersecting lives..."
It's a big stretch to assume that Roberts' fateful decision to sustain the signature legislative achievement of his fellow alumnus can be traced to their intersecting lives on Harvard Square, or to some lecture notes in common they may both have carried around in their heads or on paper from their law school days; but as matters now stand, no other convincing explanation has surfaced for Roberts' most surprising opinion. Besides that, we are dealing here with a question of law, not the psychological study of the judge's mental process. Many of the firmest principles of our common law stem from what was in the heads of English judges centuries ago. So far as I know, there are no studies of the state of mind of those bewigged judges of old to whom we owe such concepts as the Rule Against Perpetuities, or the Parol Evidence Rule, and the Rule in Shelley's Case, or, for that matter, of such more modern luminaries as Cardozo in this country, who authored such deathless prose as "the punctillio of an honor the most sensitive" to describe the obligations of partners to each other in one of his more famous opinions.
Long Wars Then and Now
This dip into history brings to mind that Europe had its Thirty Years War almost 400 years ago. Will this Health Care Reform battle be ours? The difference is theirs was between many nations combating over land, sovereignty, religion, commerce—the really big things that nations have gone to war about throughout history. Our war is also about a big issue too, but it is between ourselves.
Whatever happened to that old saw, Politics Is The Art Of Compromise? Where have all the artists gone? The polls tell us that much of the public believes the current politicians in Washington have painted themselves into dysfunctionality. It all started four years ago (during the Obama campaign for the presidency) with the uncivil wars over reforming health care. From there it went to raising the debt ceiling, and saving the auto industry, and bailing out the banks, and extending unemployment insurance, and building an oil pipe line, and balancing the federal budget, and sequestering funds, and extending the Bush tax cuts while soaking the super-rich, and on and on. But, still, repeal of the health care legislation has remained a key issue (some political observers say the defining issue) in the run-up to the elections.
The Supreme Court decision in National Federation of Independent Business not only did not put the issue to rest, but has sharpened it for voters in November. The outcome of those races will have much to say about the future of health care in this country -- and the future importance of the decision.
Copyright 2012, A. D. Lurie
Alvin D. Lurie is a practicing pension attorney. He was appointed as the first person to administer the ERISA program in the IRS National Office in Washington. He is general editor of Bender's Federal Income Taxation of Retirement Plans (LexisNexis), a 2-volume treatise, and he is also editor of the annual compendium of articles published under the title New York University Review of Employee Benefits and Executive Compensation (LexisNexis). Mr. Lurie is the first recipient of the Lifetime Employee Benefits Achievement Award sponsored by the Employee Benefits Committee of the American Bar Association Tax Section. He can be contacted at Alvin D. Lurie, P.C. in Larchmont, New York, at (914) 834-6725 or via email: <email@example.com>. He is also of counsel to The Wagner Law Group in Boston.
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