Monday, August 15, 2011

What Does the 11th Circuit Decision Mean?

(Originally posted on the National Physicians Alliance blog, August 15, 2011)


Last Friday, the 11th Circuit Court of Appeals struck down the individual mandate included in the Patient Protection and Affordable Care Act (PPACA). Conservative opponents of the law have claimed this as a blow for liberty, while the PPACA's liberal supporters believe this ruling will be overturned. At the end of the day, though--and all politics aside--what does this decision actually mean?

Timothy Jost, writing in the Health Affairs Blog, points out the decision's limited impact in this post. First of all, it is important to note that the decision does not actually rule the entire law unconstitutional. This opposes other courts' decisions stating that without the individual mandate, the rest of the law was also void; that the individual mandate was not severable from the the rest of the law. The 11th Circuit's decision states that the rest of the law can stand, even without the mandate. Politically, this would be a difficult position (health insurance companies might not be so willing to move forward on eliminating preexisting conditions and such without the increase in customers the mandate would bring) and the law will be harder to fund, but the law fundamentally is sound. So, this is not a finding against the PPACA itself. At best, opponents of the law can point to the fact that one piece of it was struck down by the court. The decision also lets stand the proposed expansion of Medicaid, something the plaintiffs wanted the appeals court to invalidated.

The Incidental Economist writes in this excellent post that:

"The most you can say is 'two judges decided the individual mandate is unconstitutional under the Commerce Clause, but would have been constitutional if it had been more explicitly designed as a tax. The rest of health care reform is constitutional.'"

This in-depth analysis of the decision notes that the individual mandate was eliminated because of the fear that if purchasing health insurance was required, then the government could force Americans to buy any other product. (As an aside: I think this argument is fatuous: so long as we have mandated care--at least ER care--and our care is paid for by insurance, then requiring all Americans to pay for their own care by buying insurance is clearly different from purchasing any other product out there.) Further in the Court's decision, there are many examples of what would have been constitutional...including a carrot-and-stick approach to encourage coverage, strengthening penalties on those without coverage etc. This does not seem to be a vigorous rejection of the individual mandate.

At the end of the day, the 11th Circuit's opinion really just means that the Supreme Court will essentially have no choice but to hear the inevitable appeal: with divided circuit decisions, and with the fact that the government will be filing the appeal, a hearing in front of the Supreme Court seems inevitable. Now, it is just a matter of when.

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