A federal district judge in Virginia determined this week that the individual insurance mandate is unconstitutional. In doing so, the judge rejected the government’s Commerce Clause, Necessary and Proper Clause, and tax arguments. I’ll leave the legal analysis to the legal experts. There is good discussion at Volokh and at the NYT. Instead, I’ll address what I see as an important problem with an argument the federal government uses in the case.
A crucial argument for the federal government is that inactivity in opting to not purchase health insurance should be considered an activity that the federal government can regulate. The logic is that most or all people will consume healthcare at some time, and if a person does not have insurance, he/she will pass the cost of that care to others. The problems with this argument include a lack of differentiation between healthcare and health insurance, and the impact of one on the other.
One should recognize that health insurance is not the same as healthcare. Insurance doesn’t guarantee that healthcare will be affordable or accessible. If a person does not have health insurance, their consumption of healthcare does not necessarily mean that the cost of that care will be passed on to someone else; a person can pay for healthcare without insurance. On the other side of the coin, a person with insurance is not certain to be able to obtain and pay for healthcare. Recognizing this should hurt the federal government’s argument that the insurance mandate is a necessary mechanism for ensuring access to affordable care.
Health insurance is a way for someone to purchase healthcare. The federal government’s goal is not to ensure access to insurance, but to ensure access to care. Essentially, the federal government wants to use the insurance mandate to subsidize healthcare. There are other more traditional ways to do this, including methods that are clearly constitutional. That the federal government is trying to use an unusual and perhaps unprecedented mechanism for regulating commerce when more accepted practices are available hurts the argument that the mandate is necessary for providing healthcare.
Also, if the federal government were allowed to mandate the purchase of a product (insurance) because the economic activity or inactivity associated with that product could impact the commerce of another product (healthcare), then what are the limits of what activity the federal government could mandate? Basic economics can show how unrelated activities can impact others, so what would the line be for when some activity that might have some impact on another cannot be regulated for its impact on the other? The federal government’s argument doesn’t seem to draw that line, and the judge in this case determined that there is no limit based on the logic used by the federal government.
Their argument, in essence, is that the government has the right to do anything it wants to in the health-care arena because all human beings get sick, and their getting sick can have economic consequences. The choice of some not to purchase insurance means that when they get sick they might incur some costs that would have to be shouldered by others. “For decades,” Holder and Sebelius write, “Supreme Court decisions have made clear that the Constitution allows Congress to adopt rules to deal with such harmful economic effects.” And the way the new health-care law would “deal with” such harmful effects is to make it illegal to make the choice not to purchase insurance. Simple.By the same logic, of course, you might argue that the government can require each of us to exercise every day and eat our vegetables. Our choice not to do so has grave economic consequences, after all, and under Obamacare, those consequences will be borne by our fellow citizens to an even greater degree than they are today.
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