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Posted June 28, 2012

UVA Law Professors React to Supreme Court Health Care, Stolen Valor Rulings

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Several University of Virginia law professors had early reactions to the U.S. Supreme Court's 5-4 ruling on the Patient Protection and Affordable Care Act, as well as a decision that struck down the Stolen Valor Act as unconstitutional.

Contact: Mary Wood

The health care opinion compiled three Supreme Court cases: National Federation of Independent Business v. Sebelius; Florida, et al., v. Department of Health and Human Services; and Department of Health and Human Services v. Florida, et al.

United States v. Alvarez concerned the legality of the Stolen Valor Act, a federal law passed in 2006 that criminalized lying about receiving military medals or honors.

LaycockDouglas Laycock (Health Care Ruling)
434-243-8546, dlaycock@virginia.edu; biography

"The bottom line here is that the Affordable Care Act is upheld. Congress cannot require people to buy health insurance, but it can tax those who refuse to do so. And a tax on those who refuse to do so is the only enforcement mechanism that Congress had enacted.

"Congress had never required everyone to purchase a product or service before; there had been no need, because no other market works like the market for health insurance. And there’s a good chance that Congress will never need to do so again, in any market other than health insurance. But if it does, it can tax people who refuse to buy the product. Under the chief justice’s reasoning, Congress can tax people who don’t buy broccoli – not that it ever would.

"Justice Ginsburg’s separate opinion would have upheld the requirement to buy health insurance as a regulation of commerce and not only as a tax. Her opinion is squarely based on the practical realities of the health insurance market. Requiring insurers to cover pre-existing conditions is indisputably a regulation of commerce, and requiring people to buy insurance is indisputably necessary to the workability of covering pre-existing conditions. People who wait till they are sick to buy health insurance are free riders, damaging the system for everybody. The problem is national, and no state can solve it on its own.

"The chief’s opinion gives lip service to those realities, but ultimately treats them as irrelevant. He thinks that if Congress can require people to buy health insurance, it can require them to buy any product or service in the economy. If he views required purchase as a problem, it would have been so easy — and a stronger protection for what he is worried about — to say that requiring people to buy something they don’t want is an unusual regulation of commerce, requiring extraordinary justification, but that extraordinary justification is present here. Perhaps it would be present in no other industry. He could have treated this case as unique because this industry really is unique.

"The Medicaid piece of this is getting less attention but is equally important. The court upheld the expansion of Medicaid to cover many of the uninsured, but struck down part of the enforcement mechanism for inducing state participation. This is the first time since 1936 that the court has limited congressional power under the spending clause. Whether anything further comes from this, either for Medicaid or in other cases, remains to be seen."
 

BonnieRichard Bonnie (Health Care Ruling)
434-924-3209, rbonnie@virginia.edu; biography

"The chief justice’s pivotal opinion upheld the individual mandate as a valid exercise of Congress’ taxing power. If the dissenters had prevailed, this would have been the most sweeping interference with the constitutional prerogatives of the Congress and the president since the New Deal. It is troubling that four justices would have invalidated the law in its entirety.

"In the short run, this is a victory for President Obama and the Democrats in Congress. In effect, a slim majority of the court held that the responsibility for deciding how to fix America’s health care system lies with Congress and ultimately with the voters. If the people don’t like the Affordable Care Act, they can elect a new Congress and a new president. They will have a chance to do that in November.

"In the long run, I am concerned about the implications of the various opinions in this case for the scope of congressional power under the commerce clause. The chief justice’s pivotal opinion upheld the individual mandate as an exercise of Congress’ taxing power. However, the chief justice and the four dissenting justices concluded that the individual mandate was not within in the reach of Congress’ power to regulate interstate commerce. In my opinion, this part of the ruling represents a substantial departure from settled understanding regarding the scope of congressional power under the commerce clause, and could produce much mischief in the future."
 

RyanJames Ryan (Health Care Ruling)
434-924-3572, jryan@virginia.edu; biography

"Another part of the opinion that is worth attention, and will not likely receive much, is the chief justice's treatment of the necessary and proper clause. The chief justice rejected both the idea that the individual mandate was a valid regulation of interstate commerce and the idea that it was a necessary and proper component of a broader regulation of the health care industry. To my mind, the reason the case was an easy one was that everyone agrees that regulating the health care industry is a regulation of interstate commerce. And it seems to me obvious that the individual mandate is a necessary and proper component of that broader regulation. In past cases, the court has treated the necessary and proper clause as giving Congress broad discretion as to how to regulate. Although the chief justice's opinion gives lip service to the scope of Congress' discretion, he concluded that the individual mandate was not necessary and proper because it was not an 'essential component' of the regulation. That seems incorrect as a description of the mandate's importance to the overall regulatory scheme here.

"Perhaps more importantly, the chief justice's language could actually prove significant in future cases, if it signals, as it seems, a restriction on the discretion traditionally afforded Congress to pass laws not only pursuant to their enumerated powers but those that are necessary and proper to implement those powers. When one recognizes that, strictly speaking, there was no need for the chief justice to say anything at all about either the commerce clause or the necessary and proper clause, given that he voted to uphold the law on an alternative basis, it's hard to escape the feeling that his use of restrictive language was not casual but strategic."
 

RileyMargaret Foster Riley (Health Care Ruling)
434-924-4671, mf9c@virginia.edu; biography

"This morning’s decision is proof that we should not put too much credence in oral argument discussion. This case was decided on the briefs.

"The most important part of this morning’s decision on the Affordable Care Act is that it happened. It removes a major piece of uncertainty. Of course the political uncertainty remains.

"The Medicaid part of the decision may have been the most surprising part of the opinion because the states’ participation in Medicaid is voluntary and the court has not put limitations on Congress’ spending powers for a very long time. Moreover, the ACA allows the states waivers that arguably limit the coerciveness of the Medicaid expansion. Treating the Medicaid expansion part of the ACA as separate from Medicaid itself may have important implications for Medicaid down the road.  But it seems likely that most states will opt in to the Medicaid expansion. The federal government funds 100 percent of the states’ share in the Medicaid expansion through 2016. Even after 2016, the federal government will be funding most of the expansion costs. Moreover, there tends to be a multiplier effect from each federal dollar spent such that the boost to the states’ economies exceeds the federal outlay. Thus, most states will find it too tempting to participate even if it is politically unpalatable. 

"It remains to be seen whether the Supreme Court’s ruling will get states to start implementing their exchange systems.  The exchanges, which are a centerpiece of the ACA, are crucial to some plans to improve competition in the health insurance markets and thereby reduce costs. To date, fewer than a third of the states have taken any action. But the exchanges are supposed to be up and ready at the end of 2013. While the federal government has allowed considerable experimentation for those states that have already implemented their exchanges, those states that lag behind may ironically find themselves governed entirely by federal rules."
 
 

PRakashSaikrishna B. Prakash (Health Care Ruling)
434-243-8539, sp5mm@virginia.edu, biography

"I don't believe the federal government would have had the power to pass the Affordable Care Act in 1789. It has that power today, or so a majority of the court tells us. What the court will say about the act (or another very similar one) in five or 10 years, no one knows.

"Those who are under the impression that the court has decided this question, once and for all time, may well be mistaken.  The New Deal conception that there are few, if any, meaningful limits on the scope of federal power is still widely held amongst lawyers, including several justices on the Supreme Court. But its grip is lessening day by day. There are many more lawyers and academics committed to the view that the federal government has limited powers than there were 20 years ago. And there are also many more politicians and citizens who wish to pare back the welfare state as a policy matter. As the majority's narrow reading of the commerce clause shows, when these two forces combine, they can transform an argument that many dismissed as silly into one capable of securing five votes. The fervor of these two groups show no signs of diminishing. With a few appointments here and there, this case may one day find itself on the ashheap of history, along with other cases that were once thought to have resolved something once and for all (Dred Scott and Roe).  The champions of broad federal power may have won the battle, but they may yet lose the war."
 

WhiteG. Edward White (Health Care Ruling)
434-924-3455, gew@virginia.edu, biography

“The health-care act case gave [Chief Justice John Roberts] him an opportunity to detach himself from his ‘conservative’ colleagues and, because of his assignment power, write the opinion himself,” University of Virginia law professor G. Edward White told Bloomberg News via email. “By doing so he looks like less of a partisan and more of a ‘statesman.’”
 
 

HafemeisterThomas Hafemeister (Health Care Ruling)
434-924-3187, th4n@virginia.edu; biography

"This must have been a frustrating experience for Chief Justice Roberts. He knew how socially divisive this issue was and he knew that traditionally the chief justice strives for unanimity among the members of the court with regard to socially divisive issues. 

"As a pragmatist, he undoubtedly knew it was going to be very hard to accomplish that here, but he probably thought he had come up with a 'solution' that might pull this off. First, place some clear limits on the scope of congressional power under the commerce clause, which would address the concerns of the court’s conservative wing about the expanding role of the federal government. At the same time, uphold the individual mandate — the key element of the Affordable Care Act — under Congress’ taxing power, which would please the liberal wing’s desire to see the law upheld, while further placating the conservative wing because this would assign a political cost to such efforts by requiring them to be characterized as an always unpopular additional tax. 

"That this was a 5-4 ruling, and a fractured majority at that, suggests the Sisyphean nature of this task. But with the Supreme Court’s approval ratings at their lowest level in a quarter century, Congress’ approval ratings even lower, and the country seemingly polarized and paralyzed by partisan divisions, it was reassuring to see the chief justice make the effort."
 

KendrickLeslie Kendrick (Stolen Valor Ruling)
434-243-8633, kendrick@virginia.edu; biography

"The Supreme Court has struck down the Stolen Valor Act, but it could not reach agreement on the reasons why the act was unconstitutional. Justice Kennedy, writing for a plurality of four, concluded that the statute failed "exacting scrutiny" and rejected any criminalization of false statements of fact in and of themselves, independent of a showing of the particular harms the statements caused. Justice Breyer, writing for himself and Justice Kagan, argued that the statute failed intermediate scrutiny but could possibly be amended to target a narrower class of more clearly harmful false statements. Justice Alito, writing for himself, Justice Scalia and Justice Thomas, dissented, arguing that the act was narrowly targeted at easily verifiable false statements of fact.  Because it targeted speech with no value and did not chill valuable speech, it should be upheld.

"The plurality and Justice Breyer agreed in backing away from a multitude of previous pronouncements by the court to the effect that false statements of fact were unprotected. Both opinions sought to place these statements within contexts in which speech was unprotected not only because it was false, but because it was closely related to certain harms. Justice Kennedy, for example, seems to flirt with creating some type of intent requirement, distinguishing false statements generally from those made "for the purpose of material gain." But Justice Alito rightly points out that the harms at issue in previous cases were diverse and diffuse and certainly cannot be distilled down to fraud for material gain.  

"Justice Kennedy seems concerned that this act could lead to many more regulations, which would be open to discriminatory enforcement. This is a real concern, which the court could have addressed through its own existing precedent of RAV v. St. Paul, which prohibits selective laws even within unprotected categories of speech. Instead, these concerns led the court to conclude that deliberate lies in some contexts are fully protected.

"The plurality disposition means that this case probably has a limited effect on larger First Amendment jurisprudence. The plurality and Justice Breyer certainly attempted to insulate this case from all other existing regulations of false statements of fact."

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