Challenges to both of theseACA provisions will require theCourt to apply the principle of federalism, which recognizes thedivision of power between thefederal and state governments.The U.S. Constitution assigns enu-merated powers to the federalgovernment, reserving the rest “to the states respectively, or to thepeople.” The justices will deter-mine whether, in crafting the ACA,Congress exceeded its powers.Numerous lawsuits have beenfiled against the ACA, but the Su-preme Court selected for review the case brought by 26states and the Nation-al Federation of Inde-pendent Business (
Florida v. HHS
)(see timeline; an interactive time-line is available with the full text of this article at NEJM.org). Inthat case, the U.S. Court of Ap-peals for the 11th Circuit ruledthat the individual mandate wasunconstitutional but that the otherinsurance reforms in the ACAcould stand.
It further ruled that the Medicaid expansion was con-stitutional. In reviewing the case,the Supreme Court will addressfour questions.First, the Court will determine whether the Tax Anti-InjunctionAct (AIA), which dates back to the1800s, precludes review of theACA until after 2014. The AIAprovides that the legality of a taxcannot be challenged until thetax has been assessed.
If, assome contend, the individual man-date’s financial penalty is a taxunder the AIA, no tax will be as-sessed until 2014 and a legal chal-lenge now is premature. Othersargue that the penalty is not atax intended to raise revenue but a financial incentive to comply with the mandate. If the Court determines that the AIA makesreview premature, it may concludethat it should not decide the sub-stantive challenges to the ACA.If the Court determines that review is appropriate, it will next consider whether Congress hasthe authority to require most U.S.citizens to purchase health insur-ance or pay a penalty. The gov-ernment argues that it has suchauthority under the Constitution’sCommerce Clause, which the Su-preme Court has interpreted asproviding Congress wide latitudeto regulate activity that, when viewed cumulatively, has a sub-stantial effect on interstate com-merce.
Americans spend an esti-mated $2.5 trillion annually onhealth care, which is indisputably a part of interstate commerce.The government will also arguethat Congress derives authority to mandate health insurance cov-erage from its constitutional pow-er to make laws that are “neces-sary and proper” for executingother powers.Challengers argue, however,that the mandate to purchase aproduct from a private entity isunprecedented and constitutes anintrusion on individual liberty. If this mandate is upheld, what elsemight the government force indi- viduals to buy? They further claimthat regulating “inactivity,” thedecision not to obtain health in-surance, is outside Congress’spower to regulate interstate com-merce.Third, if the Supreme Court rules the mandate unconstitu-tional, it will determine whetherthe rest of the ACA must also beoverturned or whether the man-date is “severable” from the rest of the law. ACA opponents arguethat the whole law must be over-turned if the Court invalidatesthe mandate, in part because themandate is “inextricably inter-twined” with the law’s other ele-ments. The government arguesthat only two other portions of the law would also have to fall if the mandate is invalidated: therequirements that insurers coverpeople with preexisting conditionsand not charge them higher pre-miums. Without a mandate, theserequirements would become in-feasible. Some authorities arguethat Congress, not the Court,should decide these questions.Finally, the Court will consider whether the ACA’s Medicaid ex-pansion is constitutional and whether states can be required tocomply with it in order to remaineligible for federal Medicaid funds.The principal point of contentionhere is whether the ACA require-ments “commandeer” or “coerce”state functions in a way that ex-ceeds federal authority. Althoughthe lower federal courts have con-sistently rejected this argument,the Supreme Court has opted toreview it. The government willargue that states operate Medic-aid programs voluntarily, contrib-uting their own funds in order toreceive federal funding, and that Congress has broad power underthe Constitution’s Taxing andSpending Clause to require statecompliance as a condition of re-ceiving federal funding.
Supreme Court Review of the Health Care Reform Law
Supreme Court Schedule for ACA Oral Arguments.
Monday, March 26, 2012Tax Anti-Injunction Act: 90 minutesTuesday, March 27, 2012Individual mandate: 120 minutesWednesday, March 28, 2012Severability of the individual mandate fromthe ACA: 90 minutesMedicaid expansion: 60 minutes
An interactivetimeline isavailable at NEJM.org
The New England Journal of MedicineDownloaded from nejm.org on March 1, 2012. For personal use only. No other uses without permission.From the NEJM Archive. Copyright © 2010 Massachusetts Medical Society. All rights reserved.