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The Constitutionality of the Affordable Care Act, Gay Edition

March 28, 2012 by Ari Ezra Waldman

The individual mandate is the ACA's requirement that almost everyone buy health insurance or pay a penalty. This serves two functions: First, by definition, it achieves near universal coverage, which was a social goal articulated by President Obama and Congress. Second, it allows the ACA's most popular provision — the ban on denying coverage to consumers with pre-existing conditions — to function. Without everyone — young and old, healthy and unhealthy — in the pool, it would be prohibitively expensive to ensure the most vulnerable among us who need health care the most.

ScTo many progressives, that sounds like good policy; but, that's a question for Congress. This week, the Supreme Court hears argument on the constitutionality of that policy, whether you think it's good or bad. And, the law's constitutionality depends on finding an enumerated power in the Constitution that allows Congress to require all citizens to buy health insurance. For states, like, say, Massachusetts, there is no such problem: States have what we call the "police power," or a general grant of power to pass laws, regulate behavior, or enforce order for the betterment of their citizens. The United States Congress has specific enumerated powers in Article I of the Federal Constitution, so any Congressional action has to be based on one of those powers. This is why states can mandate that we all buy car insurance without having to go through this debate.

The conventional progressive wisdom is that Congress's power to require nearly everyone to buy health insurance comes from the Commerce Clause, which allows Congress to regulate interstate commerce. The argument uses the language of economics (we are, after all, talking about markets), but it is pretty simple, even for the econo-phobic: The refusal to buy health insurance not only significantly affects the insurance market for everyone else (by putting upward pressure on prices), but not buying insurance is, perhaps counterintuitively, a form of economic activity. Those freely electing to be uninsured are making decisions about the cost of consuming health care services relative to the cost of consuming health care insurance, gobbling up the former when they need to, paying for it however they can, while rejecting the latter. Therefore, the individual mandate is a "necessary and proper" exercise of Congress's power under the Commerce Clause.

The Supreme Court has previously held that nonactivity is economic activity for the purposes of the Commerce Clause. In Wickard v. Filburn (1942), a wheat farmer wanted to grow more wheat than the federal government allowed after it passed a limit on wheat production per acre in order to drive up prices during the Depression. Even though the farmer said he was growing it for his own consumption, i.e., not for sale on the market, the Court held that Congress could shut him down: Growing extra wheat for yourself took you out of the very market Congress was trying to prop up. One wheat farmer might have no impact on demand, but if all wheat farmers grew their own, no one would buy any wheat on the market, slashing demand and destroying the industry. Since the "total incidence" of consumers not participating in the wheat market "poses a threat to a national market, [Congress] may regulate the entire class." (Gonzales v. Raich (2005)).

LambdalogoLambda Legal's argument for the constitutionality of the ACA is a little different. Mr. Schoettes reminds us that people living with HIV have been "systematically excluded from the health-care insurance and health-care markets." More than 67 percent of the population has private health insurance, but only 17 percent of HIV-positive individuals do. The remainder fall under Medicare, Medicaid, and the VA, nearly 30 percent are under-insured or go without insurance. This means that, on average, people with HIV go longer without care, suffer complications, and die at too high rates, with all these devastating effects more pronounced in traditionally marginalized groups, including the LGBT, poor, and black communities.

In the current health care industry context, the only way under-insured HIV-positive individuals can get insurance is through a regime that prohibits insurance companies from denying coverage to people with pre-existing conditions, which, as discussed above, only works with an individual mandate. Therefore, the mandate is a necessary and proper exercise of Congress's Commerce Clause power not because consuming health care and buying insurance affects the price of both, but rather because Congress can use its power to fix an interstate market's discriminatory effect.

BroccoliThis theory merits strong consideration, especially because it silences some the conservative economists' arguments against the progressive conventional wisdom. 

To the progressive argument that the health care market is unique, justifying regulation because of its eventual necessity in everyone's life and the requirement that all hospitals provide service regardless of the patient's ability to pay, conservatives say that the market for health care is no more unique than the market for food, which we are more likely to consume. Indeed, it's hard to see a limiting factor in a market's supposed economic "uniqueness;" all markets are somehow unique economic animals. But, while conservative economists poo poo the second uniqueness factor — the fact that hospitals have to provide health care services to all — as "circular," previous lawful Congressional regulation does make the market for health care different. Just because Congress created that difference doesn't de-legitimize the constitutionality of subsequent regulations necessary because of the original Congressional action, especially when the original Congressional action was constitutional.

And, as Mr. Schoettes points out, the health care market might also be unique because, without the ACA's individual mandate, the market excludes a particular subgroup of the population that needs health care and would be discriminated against because of the pre-existing condition that defines the group. When other interstate markets function in a discriminatory manner, the federal government has the power to step in pursuant to its powers under the Commerce Clause, the Equal Protection Clause, and the Due Process Clause.

***

Ari Ezra Waldman is a 2002 graduate of Harvard College and a 2005 graduate of Harvard Law School. After practicing in New York for five years and clerking at a federal appellate court in Washington, D.C., Ari is now on the faculty at California Western School of Law in San Diego, California. His research focuses on gay rights and the First Amendment. Ari will be writing weekly posts on law and various LGBT issues.

Follow Ari on Twitter at @ariezrawaldman.

Filed Under: News Tagged With: Ari Ezra Waldman, Health, Law - Gay, LGBT, News

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