Oral argument: March 27, 2012<\/p>\n
Appealed from: The United States Court of Appeals for the Eleventh Circuit<\/a> (Aug. 12, 2011)<\/p>\n The Patient Protection and Affordable Care Act\u2019s (\u201cHealth Care Act\u201d) minimum coverage provision requires that all eligible individuals purchase health care coverage. Beginning in 2014, any failure to purchase coverage will result in a fine. Respondents, two individual citizens, twenty-six states, and the National Federation of Independent Business, claim that the Health Care Act\u2019s minimum coverage provision is unconstitutional as it deprives individuals of the freedom to purchase what they choose, going beyond Congress\u2019s authority under the taxing powers and the Commerce Clause. Petitioner, the United States government, maintains that the minimum coverage provision is a valid way to regulate the rising health care costs that limit many individual\u2019s access to necessary health care services.<\/p>\n Beginning in 2014, the minimum coverage provision of the Patient Protection and Affordable Care Act, Pub. L. No. 111-148, 124 Stat. 119, amended by the Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111-152, 124 Stat. 1029, will require non-exempted individuals to maintain a minimum level of health insurance or pay a tax penalty. 26 U.S.C.A. 5000A. The question presented is:<\/p>\n 1. Whether Congress had the power under Article I of the Constitution to enact the minimum coverage provision.<\/p>\n Petitioners also suggest that the Court direct the parties to address the following question:<\/p>\n 2. Whether the suit brought by respondents to challenge the minimum coverage provision of the Patient Protection and Affordable Care Act is barred by the Anti-Injunction Act, 26 U.S.C. 7421(a).<\/p>\n IN ADDITION TO QUESTION 1 PRESENTED BY THE PETITION, THE PARTIES ARE DIRECTED TO BRIEF AND ARGUE THE FOLLOWING QUESTION: \u201cWHETHER THE SUIT BROUGHT BY RESPONDENTS TO CHALLENGE THE MINIMUM COVERAGE PROVISIONS OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT IS BARRED BY THE ANTI-INJUNCTION ACT, 26 U.S.C. \u00a77421(A).\u201d<\/p>\n top<\/a><\/p>\n Does Congress have the power to enact the minimum coverage provision under the Necessary and Proper Clause, Commerce Clause, or under Congress\u2019s independent power to levy taxes?<\/p>\n top<\/a><\/p>\n On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act<\/a> (\u201cHealth Care Act\u201d) into law. The Health Care Act contains a minimum coverage provision<\/a> (\u201cindividual mandate\u201d), which states that all eligible individuals must have the \u201cminimal essential\u201d level of health care coverage. See <\/em><\/strong>26 U.S.C. \u00a7 5000A<\/strong><\/a>. <\/strong>Under this provision, individuals must purchase and maintain a minimum amount of health care coverage for themselves and their dependents. See id. \u00a7 5000A(a)<\/a><\/em><\/strong>. <\/strong>Exemptions to the mandate are available for undocumented immigrants, incarcerated individuals, those unable to pay under certain requirements, or those with religious objections. See id. \u00a7 5000A(d)\u2013(e)<\/a><\/em><\/strong>. <\/strong>Beginning in 2014, those who fail to purchase coverage are required to pay a flat penalty fee, which will increase from 2014 to 2016, or a percentage of their income if it is higher than the penalty fee. See id. \u00a7 5000A(b)(1),(c)<\/a><\/em><\/strong>. <\/strong>Employers who do not offer their employees health care coverage are subject to similar penalties. See <\/em><\/strong>26 U.S.C. \u00a7 4980H<\/strong><\/a>.<\/strong><\/p>\n Soon after President Obama signed the Health Care Act into law, Mary Brown and Kaj Ahlburg, the National Federation of Independent Business<\/a>, and twenty-six states (collectively \u201cNFIB\u201d) filed suit in the U.S. District Court for the Northern District of Florida<\/a> against the Department of Health and Human Services<\/a>, Department of the Treasury<\/a>, and Department of Labor<\/a> (collectively \u201cHHS\u201d). See Florida v. Dep\u2019t of Health & Human Servs.<\/a><\/em><\/strong>, 780 F. Supp. 2d 1256, 1263. <\/strong>Among other things, NFIB challenged the Health Care Act\u2019s individual mandate. See id.<\/a> <\/em><\/strong>at 1265.<\/strong> The district court granted summary judgment<\/a> to NFIB on issue of the individual mandate\u2019s constitutionality, stating that that provision is not a valid use of Congress\u2019s authority under the taxing<\/a> powers or the Commerce Clause<\/a>. See id.<\/a> <\/em><\/strong>at 1306\u201307. <\/strong>The district court also held that the individual mandate could not be severed from the Health Care Act, and therefore the entire Health Care Act is unconstitutional. See id.<\/a> <\/em><\/strong>On appeal, the United States Court of Appeals for the Eleventh Circuit<\/a> reversed the grant of summary judgment, agreeing that the individual mandate was not permissible under Congress\u2019s taxing power but maintaining that the individual mandate could be severed from the rest of the Act. See Florida v. Dep\u2019t of Health & Human Servs.<\/a><\/em><\/strong>, 648 F.3d 1235, 1328.<\/strong> <\/em><\/strong>Thus, according to the Eleventh Circuit, the Health Care Act\u2019s constitutionality does not turn on the validity of the individual mandate. See id.<\/a> <\/em><\/strong>The Supreme Court<\/a> granted certiorari<\/a> on November 14, 2011 to consider, among other questions, whether Congress has the power to enact the Health Care Act\u2019s individual mandate. See <\/em><\/strong>Dep’t of Health & Human Servs. v. Florida<\/em><\/strong><\/a>, 132 S. Ct. 604 (2011).<\/strong><\/p>\n top<\/a><\/p>\n Private Respondents, Mary Brown, Kaj Ahlburg, and the National Federation of Independent Business<\/a> (collectively \u201cNFIB\u201d), and State Respondents, comprised of twenty-six states, argue that the Patient Protection and Affordable Care Act<\/a>\u2019s (\u201cHealth Care Act\u201d) minimum coverage provision within the individual mandate is unconstitutional because it requires individuals to enter into financial contracts without considering individual needs. Petitioners, the Department of Health and Human Services<\/a>, the Department of the Treasury<\/a>, and the Department of Labor<\/a> (collectively \u201cHHS\u201d), argue that the individual mandate is constitutional and necessary to an effective health care system, because without it, individuals would drive up health care costs by waiting to purchase coverage.<\/p>\n Fears of a Centralized Government<\/em><\/p>\n NFIB argues that the individual mandate deprives citizens of the freedom to choose their financial relationships and requires individuals to enter into financially disadvantageous contracts. See <\/em><\/strong>Brief for Private Respondents<\/strong><\/a> at 13, 61\u201362. <\/strong>According to the States, there is no difference between requiring individuals to purchase health care insurance and requiring individuals to purchase a car, because in both situations Congress could justify the requirement under the premise that individual decisions, when aggregated, affect interstate commerce. See <\/em><\/strong>Brief for State Respondents<\/strong><\/a> at 27\u201328. <\/strong>NFIB notes that compelling commerce in this way would create a centralized government, which could mandate the purchase of goods by characterizing the failure to buy as an \u201ceconomic decision\u201d that hurts the relevant market. See <\/em><\/strong>Brief for Private Respondents<\/strong><\/a> at 33\u201334.<\/strong> This problem is exacerbated, the States argue, because there is no clear boundary in determining what decisions have sufficient effects on interstate commerce to justify government regulation. See <\/em><\/strong>Brief for State Respondents<\/strong><\/a> at 29\u201330. A number of health law professors argue that the individual mandate should not be scrutinized without considering health care\u2019s unique place in society\u2014it\u2019s an expansive industry with which nearly every American interacts, but health care costs on the individual level are much less predictable than costs in comparable markets. See <\/em><\/strong>Brief of Amici Curiae 104 Health Law Professors<\/strong><\/a> in Support of Petitioners at 9, 14\u201315. <\/strong>Health care is also different, law professors note, due to the considerations for human life that trump an inability to afford the care. See id.<\/a><\/em><\/strong> at 11\u201313. <\/strong>Because the health care market is so different from any other market, the American Hospital Association (\u201cAHA\u201d) argues that Respondents\u2019 \u201cslippery slope\u201d argument fails. See <\/em><\/strong>Brief of Amici Curiae American Hospital Association et al.<\/strong><\/a> in Support of Petitioners at 23. <\/strong>AHA states that the individual mandate does not force people to buy health care; rather, the mandate regulates the market so that individuals cannot use free health care services and require paying individuals to absorb the costs. See id.<\/a><\/em><\/strong> at 23\u201324.<\/strong><\/p>\n Allocation of Costs<\/em><\/p>\n The States argue that the individual mandate imposes costs on all individuals by requiring everyone to purchase of health care insurance, regardless of need. See <\/em><\/strong>Brief for State Respondents<\/strong><\/a> at 25. <\/strong>NFIB contends that health care is not a unique \u201cnear-universal\u201d business because many of those who are currently uninsured will not actually need health care services, but will have to pay annual insurance costs anyway. See <\/em><\/strong>Brief for Private Respondents<\/strong><\/a> at 54\u201355. <\/strong>The American Center for Law & Justice<\/a> asserts that insurance costs are now being imposed on the entire population based only on the possibility that some individuals will obtain future health care services without insurance. See <\/em><\/strong>Brief of Amici Curiae American Center for Law & Justice, et al.<\/strong><\/a> at 21. <\/strong>Oklahoma argues that these health care concerns are better left to the judgment of the states, which are currently divided over the individual mandate\u2019s necessity, because a state can more easily mold its laws to reflect its people\u2019s will. See <\/em><\/strong>Brief of Amicus Curiae State of Oklahoma<\/strong><\/a> in Support of Respondents at 10\u201311.<\/strong><\/p>\n HHS argues that the Health Care Act\u2019s individual mandate is necessary to prevent individuals from driving up health care costs by waiting to purchase coverage until they need medical services. See <\/em><\/strong>Brief for Petitioners<\/strong><\/a> at 29. <\/strong>Congressional leaders assert that when uninsured individuals use health care services, which 94% of them do, those costs are shifted to the insured in the form of higher premium costs. See <\/em><\/strong>Brief of Amici Curiae Senate Majority Leader Harry Reid, et al.<\/strong><\/a> in Support of Petitioners at 21. <\/strong>Young Invincibles<\/a> notes this problem is especially relevant for individuals ages eighteen to thirty-four, as almost 30% are uninsured due to high coverage costs. See <\/em><\/strong>Brief of Amicus Curiae Young Invincibles<\/strong><\/a> in Support of Petitioner at 10, 13. <\/strong>HHS contends the mandate also assists in lowering health care premiums for all by increasing insurer competition. See id.<\/a> <\/em><\/strong>at 31. <\/strong>Several states argue that the problems of underinsured citizens and high health care costs plague every state, and that states cannot cure these problems on their own. See <\/em><\/strong>Brief of Amici Curiae States of Maryland, California, et al.<\/strong><\/a> in Support of Petitioners at 8, 11\u201312.<\/strong><\/p>\n top<\/a><\/p>\n At issue is the minimum coverage provision<\/a> within the individual mandate contained in the Patient Protection and Affordable Care Act<\/a> (\u201cHealth Care Act\u201d). The individual mandate provides that taxpayers who do not obtain the required health insurance coverage for themselves or their dependents are subject to a penalty for each year that the taxpayer fails to meet the requirement. See <\/em><\/strong>26 U.S.C. 5000A<\/strong><\/a>. <\/strong>The Health Care Act also contains a guaranteed-issue provision<\/a>, which prohibits the denial of insurance based on pre-existing medical conditions, and a community-rating provision<\/a>, which stops insurers from charging increased premiums based on pre-existing medical conditions. See <\/em><\/strong>42 U.S.C. \u00a7 300GG-1<\/strong><\/a>; 42 U.S.C. \u00a7 300GG-4<\/a>.<\/strong><\/p>\n Congressional Power Pursuant to the Necessary and Proper Clause and the Commerce Clause <\/em><\/p>\n The Department of Health and Human Services<\/a>, the Department of the Treasury<\/a>, and the Department of Labor<\/a> (collectively \u201cHHS\u201d) argue that the individual mandate falls within Congress\u2019s powers under the Necessary and Proper Clause<\/a>. See <\/em><\/strong>Brief for Petitioners<\/strong><\/a> at 21. <\/strong>HHS contends that the Necessary and Proper Clause gives Congress the broad power to pass federal legislation in order to further a legitimate purpose. See id.<\/a><\/em><\/strong> at 22\u201323. <\/strong>HHS points out that the Health Care Act serves a legitimate purpose\u2014to reform the health care market\u2014and the individual mandate is crucial to the viability of the Act. See id.<\/a><\/em><\/strong> at 23\u201324. <\/strong>HHS argues that without this mandate, other key provisions of the Act, such as the guaranteed-issue and community-rating provisions, would fail. See <\/em><\/strong>id.<\/em><\/strong><\/a> at 24\u201325. <\/strong>HHS elaborates that the mandate provides the financing for the anti-discriminatory practices that the guarantee-issue and community-rating provisions seek to accomplish. See <\/em><\/strong>id.<\/em><\/strong><\/a> at 28\u201330. <\/strong>The individual mandate, HHS argues, prevents individuals from increasing insurance costs by waiting to purchase health insurance until a medical need arises, thereby exploiting the guarantee-issue and community-rating provisions. See id.<\/a><\/em><\/strong> at 29. <\/strong>Because the mandate is necessary for the success the Health Care Act\u2019s other provisions, HHS asserts that it falls within the realm of Congress\u2019s power pursuant to the Necessary and Proper Clause. See <\/em><\/strong>id<\/em>.<\/strong><\/a> at 32. <\/strong>HHS also contends that the mandate fall under Congress\u2019s power pursuant to the Commerce Clause<\/a> because it regulates the purchase of healthcare, which is \u201ccommercial and economic in nature.\u201d See<\/em><\/strong> <\/strong>id.<\/a><\/em><\/strong> at 33.<\/strong> HHS insists that this type of activity affects interstate commerce because it has financial implications for many other industries. See<\/em><\/strong> <\/strong>id.<\/a><\/em><\/strong> at 33\u201334.<\/strong> Congress has validly employed its commerce power to regulate this industry, HHS argues, by incentivizing uninsured citizens to purchase insurance and stop passing the costs onto those who are insured. See<\/em><\/strong> <\/strong>id.<\/a><\/em><\/strong><\/p>\n Private Respondents, two individual citizens and the National Federation of Independent Business<\/a> (collectively \u201cNFIB\u201d), contend that the Necessary and Proper Clause does not create Congressional power, but rather limits Congress to enacting legislation that is necessary to implement one of the specifically enumerated constitutional powers. See <\/em><\/strong>Brief for Private Respondents<\/strong><\/a> at 11\u201312. <\/strong>NFIB insists that the individual mandate cannot be upheld under the Necessary and Proper Clause because it exceeds Congress\u2019s power by compelling individuals to subsidize the costs generated by the Health Care Act\u2019s regulations. See <\/em><\/strong>id.<\/em><\/strong><\/a> at 43. <\/strong>NFIB points out that the individual mandate off-sets the high costs that the Health Care Act incurs by passing those costs onto healthy taxpayers, who then have to pay a premium exceeding their actuarial risk. See <\/em><\/strong>id<\/em>.<\/strong><\/a> at 40\u201341. <\/strong>Moreover, NFIB contends that the Commerce Clause only gives Congress power to regulate economic activity that directly relates to a legitimate interstate goal; however, NFIB insists, the failure to obtain health insurance is not an economic activity. HEALTH CARE, PATIENT PROTECTION AND AFFORDABLE CARE ACT, MINIMUM COVERAGE PROVISION<\/h2>\n
Question presented<\/h2>\n
Issue<\/h2>\n
Facts<\/h2>\n
Discussion<\/h2>\n
<\/strong><\/p>\nAnalysis<\/h2>\n