This case raises a serious constitutional question about the 2010 Affordable Care Act, one of the most consequential laws ever enacted by Congress. Did Congress’s enactment of the Act comport with the Origination Clause of the Constitution? The Origination Clause provides: “All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.” U.S. Const. art. 1, § 7, cl. 1. The Origination Clause therefore requires that bills for “raising Revenue” originate in the House of Representatives. Revenue bills may be amended in the Senate “as on other Bills,” but they must originate in the House. If the Affordable Care Act did not meet the requirements of the Origination Clause, then the Act – or at least revenue-raising provisions such as the individual mandate – must be invalidated.
In my view, the Affordable Care Act complied with the Origination Clause, but not for the reason articulated by the three-judge panel opinion. The panel opinion concluded that the Affordable Care Act was not a revenue-raising bill for purposes of the Origination Clause and therefore did not have to originate in the House. In my respectful view, that conclusion is untenable. The Affordable Care Act established new subsidies for the purchase of health insurance and expanded the Medicaid program for low-income Americans. Those new subsidies and expanded entitlements cost an enormous amount of money. So as not to increase the annual budget deficit and the overall national debt, the Act imposed numerous taxes to raise revenue. Lots of revenue. $473 billion in revenue over 10 years. It is difficult to say with a straight face that a bill raising $473 billion in revenue is not a “Bill for raising Revenue.”
The Affordable Care Act therefore was a revenue-raising bill subject to the Origination Clause. That said, the Act did in fact originate in the House, as required by the Clause. Although the original House bill was amended and its language replaced in the Senate, such Senate amendments are permissible under the Clause’s text and precedent.
So in concluding that the Affordable Care Act complied with the Origination Clause, the panel opinion reached the right bottom line, but relied on what I see as a faulty rationale. Does such a case still warrant en banc review? Oftentimes no, but here yes. The panel opinion sets a constitutional precedent that is too important to let linger and metastasize. Although no doubt viewed by some today as a trivial or anachronistic annoyance, the Origination Clause was an integral part of the Framers’ blueprint for protecting the people from excessive federal taxation. It is true that the Framers’ decision to grant the Senate a broad amendment power gave the Origination Clause less bite than it otherwise might have had. But the Clause nonetheless has been important historically and remains vital in the modern legislative process. By newly exempting a substantial swath of tax legislation from the Origination Clause, the panel opinion degrades the House’s origination authority in a way contrary to the Constitution’s text and history, and contrary to congressional practice. As a result, the panel opinion upsets the longstanding balance of power between the House and the Senate regarding the initiation of tax legislation. Therefore, I would grant rehearing en banc. In my respectful view, the en banc Court should vacate the panel opinion and rule for the Government on the ground that the Affordable Care Act originated in the House and thereby complied with the Origination Clause.
At oral argument in the Supreme Court’s most recent Origination Clause case some years ago, United States v. Munoz-Flores, 495 U.S. 385 (1990), Justice O’Connor posed a hypothetical about a national highway funding bill that increased income taxes to be paid into the general treasury “for that purpose” – that is, to “support the road building.” That hypothetical almost precisely tracks the Origination Clause issue we face in this case. The hypothetical was not presented in Munoz-Flores, but Justice O’Connor asked about it to test the limits of the Government’s theory. The Government attorney dutifully claimed (then as now) that such a hypothetical bill would not be subject to the Origination Clause. Justice O’Connor responded: “Well, that’s a pretty extreme position.” True then. And true now.