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Right Turn
Posted at 03:19 PM ET, 03/28/2012

Obamacare suffers a severability trainwreck at the Supreme Court

If yesterday was a surprise to the liberal defenders of Obamacare, today must have been a shocker. Judging from today’s oral argument, five Supreme Court justices seem fully prepared to strike down the entire statute if the individual mandate fails. In this regard, the justices seem to have largely accepted the argument that I outlined this morning: Without the individual mandate to, in essence, herd customers to insurance companies and provide financial support for the other provisions of the law, the goal of universal access would be thwarted.

Paul Clement, representing those challenging the law, started out strong, making the case to Justice Sonia Sotomayor that, if something is to be pieced together in the wake of the failure of the individual mandate, Congress should tackle that job. “The question is, really, what task do you want to give Congress,” said Clement. “Do you want to give Congress the task of fixing the statute after something has been taken out, especially a provision at the heart, or do you want to give Congress the task of fixing health care?”

That argument was especially persuasive with Justice Anthony Kennedy. This exchange between Kennedy and Edwin Kneedler, the associate solicitor general, was telling:

KENNEDY: When you say judicial restraint, you are echoing the earlier premise that it increases the judicial power if the judiciary strikes down other provisions of the Act. I suggest to you it might be quite the opposite. We would be exercising the judicial power if . . . one provision was stricken and the others remained to impose a risk on insurance companies that Congress had never intended. By reason of this Court, we would have a new regime that Congress did not provide for, did not consider. That, it seems to me, can be argued at least to be a more extreme exercise of judicial power than to strike — than striking the whole.
KNEEDLER: I — I — I think not -
KENNEDY: I just don’t accept the premise.
KNEEDLER: I think not, Justice Kennedy, and then I — I will move on.

Ooof.

Again and again Kennedy and the other justices hammered the government’s lawyer:

JUSTICE SAMUEL ALITO: Well, if that is true, what is the difference between guaranteed-issue and community-rating provisions on the one hand and other provisions that increase costs substantially for insurance companies?
For example, the tax on high-cost health plans, which the economists in the amicus brief said would cost $217 billion over 10 years?
KNEEDLER: . . . Congress did not think of those things as balancing insurance companies. Insurance companies are participants in the market for Medicaid and — and other things.
KENNEDY: But you are saying we have the expertise to make the inquiry you want us to make, i.e., the guaranteed-issue, but not the expertise that Justice Alito’s question suggests we must make.
KNEEDLER: Well —
KENNEDY: I just don’t understand your position.

And then there was this interchange with H. Bartow Farr III, the court-appointed lawyer charged with arguing for complete severability — removing only the individual mandate from the health-care law and leaving the rest intact — a position not even the government had taken

KENNEDY: So do you want us to write an opinion saying we have concluded that there is an insignificant risk of a substantial adverse effect on the insurance companies, that’s our economic conclusion, and therefore not severable? That’s what you want me to say?
FARR: It doesn’t sound right the way you say it, Justice Kennedy.

Plainly five justices did not want to go line by line through the statute, trying to figure out which parts could survive, and saw that as largely a legislative repair job. This exchange is noteworthy, with Sotomayor trying to save the remainder of the statute:

JUSTICE ANTONIN SCALIA: Mr. Kneedler, what happened to the Eighth Amendment? You really want us to go through these 2,700 pages?
(Laughter.)
SCALIA: And do you really expect the Court to do that? Or do you expect us to — to give this function to our law clerks?
Is this not totally unrealistic? That we are going to go through this enormous bill item by item and decide each one?
KNEEDLER: Well —
SOTOMAYOR: I thought the answer was you don’t have to because —
KNEEDLER: Well, that is, that is the —
SOTOMAYOR: — what we have to look at is what Congress said was essential, correct?
KNEEDLER: That is correct.

When a justice says, “I thought the answer was . . .,” you know you’ve pretty much missed the boat.

Justice Stephen Breyer bizarrely suggested at one point that the parties engage in a sort of reconciliation action, a suggestion that made even the government’s attorney blanch and prompted Scalia to poke fun:

BREYER: [O]n a list of things that are, in both your opinions, peripheral, then you would focus on those areas where one of you thinks it’s peripheral and one of you thinks it’s not peripheral. And at that point it might turn out to be far fewer than we are currently imagining. At which point we could hold an argument or figure out some way or somebody hold an argument and try to — try to get those done.
Is — is that a pipe dream or is that a —
KNEEDLER: I — I — I just don’t think that is realistic. The Court would be doing it without the parties, the millions of parties -
SCALIA: You can have a conference committee report afterwards, maybe.

It was that kind of day for the government. The argument today was another instance in which the challengers rolled up their sleeves, got into the text of the statute and made a convincing case. The government never sufficiently spelled out how the mandate could be severed from the rest of the bill without upsetting the intricate system of subsidies and the goal of expanded access. In hiding the ball from the public by virtue of an overly intricate fog of misdirection, and in disguising the essence of the scheme — healthy, young people who might not otherwise want insurance are compelled to buy it to ameliorate the costs of others — Congress sent the Supreme Court a legal knot that will be hard to undo.

I’ll be candid: Until reading the briefs on this issue, I thought this was a long shot for the challengers. It seemed a stretch to take down the whole statute. After reading the briefs and the transcript of the argument, I think this is among the easier issues in the case.

By  |  03:19 PM ET, 03/28/2012

Categories:  law, Obamacare

 
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