SCOTUS and the PPACA: Day One

Today is the first day of oral arguments over the Patient Protection and Affordable Care Act (Obamacare) at the Supreme Court of the United States (SCOTUS). The court has set aside a rare six hours of arguments over four contentious issues – the Anti-Injunction Act, the Individual Mandate, Severability, and the expansion of Medicaid. I don’t plan on blogging over the issues extensively, as they are being written about very well elsewhere, but I will write briefly about what I’m looking for on each issue.

Sarah Kliff has a good rundown over the schedule here, but todays arguments will center on whether SCOTUS can even “hear” the case given that no one has paid the tax penalty for not carrying health insurance

Anti-Injunction Act

What it is: This is the question that decides where any of the other questions even matter. Under a law passed in 1867, the Anti-Injunction Act, a tax cannot be challenged until someone has actually had to pay it. Health reform’s penalties don’t start until 2015. The Court opens its oral arguments with a debate over whether it can even issue a ruling on the Affordable Care Act since its penalties for not carrying insurance have not come into effect yet.

What the two sides will argue: One weird quirk of this provision is that neither the defendants or plaintiffs think it applies: Both sides contend that the Court should be able to rule right now . So the justices appointed an outside lawyer, Robert Long, to argue on their behalf. Long will likely look to the Fourth Circuit Court of Appeals for precedent. It ruled, in September, that the Anti-Injunction Act prevented it from issuing a ruling on the health law.

When it happens: Monday, March 26, 10-11:30 a.m.

Why it matters: The Anti-Injunction Act gives the Supreme Court an opportunity to put off its decision for at least three years, potentially diffusing their role in a presidential election year. This could be a mixed-bag for health care supporters: On the one hand, it gives the law three more years to be implemented. On the other, it would still leave the law’s fate uncertain, and likely extend the national debate around the Affordable Care Act.

Now by the time this post goes up the oral arguments will be finished, but CSPAN plans on releasing the audio around 2 pm eastern here.

Although I’ve read that several are finding todays deliberations the least compelling, there is one thing I’ll be listening for – a discussion over whether the PPACA (specifically, the Individual Mandate) is in fact a tax. Now the government argues that the mandate falls within their authority to tax, but for the purposes of the Anti-Injunction Act the mandate is not a tax. The opponents happen to agree, which is why most predict that SCOTUS will go ahead and hear the case.

I’m not a legal expert, but from my understanding for all intents and purposes the mandate is essentially a tax – if you don’t carry health insurance (and don’t qualify for Medicaid, and numerous other exemptions) then you’ll be assessed a tax penalty, which is akin to a “negative” tax credit. Your federal tax liability will be higher than it otherwise would, just as with a tax credit your federal tax liability would be lower than it otherwise would. I could understand that for the purpose of what the Anti-Injuction covers, the mandate is not a traditional tax. If SCOTUS decides that it can hear the case, I expect the laws opponents to trumpet the decision as proof that the mandate isn’t an exercise of the government’s ability to tax. However I think such an assertion would be too much of a stretch, as the question before the court is a rather narrow legal consideration.

 

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One response to “SCOTUS and the PPACA: Day One

  1. Pingback: The Affordable Care Act is Constitutional | Punditocracy·

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