The court’s conservatives, including Roberts, agreed that the individual mandate violated the Constitution’s Commerce Clause.
The Commerce Clause authorizes Congress to regulate commerce “among the several states.” Since the New Deal era of the 1930s, this has justified many expansions of the federal government on the basis that the activity substantially affects commerce.
“It is no surprise that Congress has employed the commerce power in a wide variety of ways to address the pressing needs of the time,” Roberts wrote, “but Congress has never attempted to rely on that power to compel individuals not engaged in commerce to purchase an unwanted product.”
The court’s four liberal justices contended that the Commerce Clause empowered Congress to impose the mandate, with Justice Ruth Bader Ginsburg arguing in dissent that while “the insurance-purchase mandate is novel … novelty is no reason to reject it.” This reasoning, had it prevailed, would have been much more sweeping than Roberts wanted. It also would have encouraged more congressional efforts to build laws atop the Commerce Clause.
Justices Sonia Sotomayor, Elena Kagan and Stephen Breyer joined Ginsburg.
Instead, Roberts tied approval of the individual mandate to the power of Congress to “lay and collect taxes.” Though Obama and congressional Democrats denied that the individual-mandate penalty was a tax, Roberts reasoned that it effectively serves as a tax. That saved the mandate, but it set a less aggressive precedent.
“It’s very narrow in its implications,” said Jeffrey Rosen, a George Washington University law professor. Nan Aron, the president of the liberal Alliance for Justice, called the court’s view of the Commerce Clause a “ticking time bomb” that may enable a conservative majority to form again in the future and undo other social welfare legislation.
Three conservative justices who usually are Roberts’ allies, along with swing-vote Justice Anthony Kennedy, said that even the tax-powers reasoning gave Congress too much benefit of the doubt.
‘Penalty, not tax’
“In the case of the Affordable Care Act, Congress went to great lengths to structure the mandate as a penalty, not a tax,” Kennedy wrote for the dissenters. “But the majority now says that it is a tax, at least for the purpose of sustaining it.”
Justices Antonin Scalia, Samuel Alito and Clarence Thomas joined Kennedy.
Roberts also combined with liberal justices to salvage part of an expansion program for Medicaid — the federal-state health plan for the poor — albeit in more limited form.
Flexing federal muscle, the law pushes the states to cover residents who have higher incomes. It also establishes new minimum coverage levels for Medicaid. The law allows a cutoff of federal Medicaid money to states that don’t expand coverage to individuals with incomes up to 133 percent of the poverty line — about $30,000 for a family of four.
Although the federal government still will pay 90 percent of the additional costs, states complained that the threatened withholding of funds amounted to inappropriate coercion. The states receive more than $250 billion annually in federal Medicaid funds.
While describing the threatened loss of all Medicaid funds as a “gun to the head,” Roberts said the federal government could reasonably withhold new funds intended to pay for the expanded coverage.
“What Congress is not free to do is to penalize states that choose not to participate in that new program by taking away their existing Medicaid funding,” Roberts wrote, adding that “nothing in our opinion precludes Congress from offering funds under the Affordable Care Act to expand the availability of healthcare, and requiring that states accepting such funds comply with the conditions on their use.”
“The court does not express any opinion on the wisdom of the Affordable Care Act,” Roberts wrote. “Under the Constitution, that judgment is reserved to the people.”
Michael Doyle and David Lightman can be reached at mdoylemcclatchydc.com, dlightmanmcclatchydc.com.