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Trying to Understand Obamacare Ruling?

Sharon Patch's law columnist summarizes this big issue.

A heavily divided United States Supreme Court ruled today that the key provision of the Patient Protection and Affordable Care Act ("Obamacare") – the so-called "individual mandate" that all persons obtain coverage or pay a fine for
failing to do so - is constitutional.

Absent repeal by Congress, Obamacare is now the law of the land.

The Court published nearly a dozen different opinions today, all of which can be
found in PDF form at the Court's website. They total almost one hundred pages in length.

This column offers a very quick summary of the big issue – whether Congress can impose the individual mandate.

In a somewhat unusual "introductory passage," Chief Justice Roberts is careful to frame the issue as whether "Congress has the power under the Constitution to enact the challenged provisions." The Court does not, the Chief Justice claims, consider "whether the Act embodies sound policies."

Normally, that would go without saying. But Chief Justice Roberts knows that
this particular Court decision will get more attention than most, and he no doubt wants to make sure laypersons understand that the Court's function in our system is to determine whether laws are permissible, not whether they are good ideas.

The Chief Justice then goes on to summarize the dual, important functions
delegated to Congress under the Constitution – the power to regulate interstate
commerce and the power to tax. The latter authority, as you will see, later
provides the justification for upholding the Act.

In Part-I, Chief Justice Roberts, joined by Democrat-appointees Sotomayor, Kagan, Ginsberg and Breyer, addresses an issue involving the Anti-Injunction Act. This obscure federal law essentially provides that no person may challenge a tax law until the government actually seeks to impose the tax. Under the Act, beginning in 2014 if a person fails to acquire health insurance through ordinary means, absent certain exceptions that individual will be required to make a shared responsibility payment to the government. Defenders of Obamacare claimed that since the shared responsibility payments were not due to be enforced for another two years, challenges to the Act were premature.

In response, Chief Justice Roberts ruled that the Anti-Injunction Act does not
apply. Interestingly, he held that the shared responsibility payment is, according
to Congress, not a "tax" but rather is, according to Congress, a "penalty."
Challengers are free, therefore, to complain about the Act now.

In Part III-A, Justice Roberts dismisses the argument that Obamacare represents a lawful exercise of Congress' power under the Commerce Clause. The primary rationale appears to be based on the fact that the Commerce Clause is designed to give Congress the power to regulate economic "activity." In this instance, by imposing the shared responsibility payment in cases where individuals fail to acquire insurance, Congress would, in essence, be regulating "inactivity."

The Commerce Clause was viewed by many pundits as the best hope of
supporters of Obamacare to find the act Constitutional. Many observers
believed that the Court would not conclude that the Act was a lawful exercise
of Congress' taxation power, especially since the government, and, indeed, the
President himself, claimed in a now famous interview with ABC that the individual mandate was not a tax.

In Part III-C of his opinion, in which the four Democrat justices joined, Chief
Justice Roberts rules that the individual mandate is, for all intents and purposes, a "tax," despite his earlier conclusion that the shared responsibility payment is, by Congress' description, a "penalty." The Chief explains that in the case of determining whether a particular act of Congress is or is not a tax, the Court must look at the "substance and application of the law" rather than the words used by Congress to describe it. In the opinion of the majority of justices, the individual mandate is a proper exercise of Congress’s taxation power.

In dissent, Justices Scalia, Thomas, Kennedy and Alito take serious issue with the construction of the individual mandate as a "tax." They construe the requirement to obtain insurance under threat of being subject to a shared responsibility payment, quite simply, as "a mandate to which a penalty is attached." They conclude that the Act should have been declared an unlawful exercise of Congressional power.

Whether one believes that Obamacare represents a creative and effective
solution to our nation's health care and medical insurance challenges, or a
monstrous, European-style social program that will, in the long run, create
vast bureaucracies and ultimately hurt the quality of healthcare to which most
Americans have become accustomed, one cannot deny that today’s decision is
the most historic one in a generation.

If opponents of the law wish to repeal it, they will have to do it by getting new
legislation through Congress.

That won't be easy.

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