Healthcare Law Ruled Unconstitutional

A couple weeks ago, Judge Roger Vinson of the United States District Court for the Northern District of Florida handed down his decision ruling the Obama Healthcare law unconstitutional. However, Judge Vinson’s ruling is just the beginning of a much larger and longer battle ahead. To read Judge Vinson’s ruling in State of Florida v. U.S. Dept. of Health and Human Services, click here.

Before Judge Vinson’s ruling, three other federal district courts had already heard and decided cases challenging the Constitutionality of the Healthcare Law. The Western District Court of Virginia and the Eastern District Court for Michigan held the individual mandate is a proper exercise of the Commerce Clause of the U.S. Constitution.* However, the Eastern District Court of Virginia held the individual mandate violates the Commerce Clause.**

Here’s a little background on the lawsuit Judge Vinson presided over:

-The suit was heard on two counts: the constitutionality of the individual mandate per the Commerce Clause, and the constitutionality of the changes to the Medicaid program per the Spending Clause.

-The Plaintiffs-Challengers included two individuals, both residents of Florida, who claimed they did not currently have personal health insurance and they would be financially harmed if forced to purchase such insurance by the Healthcare Law. The Plaintiffs-Challengers included 26 states, including Ohio, which claimed each state would be harmed financially by foreseeable increases in each state’s Medicaid expenses. Finally, the National Federation of Independent Business also joined the suit as Plaintiff-Challenger.

-The Defendants were the U.S. Department of Health and Human Services, the U.S. Department of the Treasury, the U.S. Department of Labor and their respective secretaries.

I’m not going focus on the Medicaid aspect of Judge Vinson’s ruling; this blog post is about the individual mandate portion of the ruling. If you want to read more about the Medicaid aspect of the ruling, click here.

On to the individual mandate. The Plaintiffs-Challengers argued the individual mandate was unconstitutional because it violated the Commerce Clause of the U.S. Constitution. The Commerce Clause is an enumerated power given to Congress in Article, Section 8, Clause 3. It states Congress has the power “[t]o regulate Commerce with foreign Nations, and among the several States and with the Indian Tribes.”

The Supreme Court of the United States interpreted the Commerce Clause to include three broad categories of activity, which Congress may enact laws and regulate under the Clause: “[f]irst, Congress may regulate the use of the channels of interstate commerce. Second, Congress is empowered to regulate and protect the instrumentalities of interstate commerce, or persons or things in interstate commerce, even though the threat may come only from intrastate activities. Finally, Congress’ commerce authority includes the power to regulate those activities having a substantial relation to interstate commerce, i.e., those activities that substantially affect interstate commerce.”***

Judge Vinson identified the third category as that which applied to the constitutionality of the individual mandate. In his ruling the key distinction for Vinson was whether there must be activity for Congress to regulate, or whether Congress can regulate inactivity. In other words, can YOU be regulated by Congress AFTER you purchase health insurance (activity); or can YOU be regulated by Congress for NOT purchasing health insurance (inactivity).

Vinson discussed the Commerce Clause’s jurisprudence (case law from the past 200 years), which 100% of the time included cases which included activity by an individual, a business or a state(s). Vinson found nothing in the Clause’s jurisprudence that suggested Congress had the power to regulate inactivity. Vinson also reviewed past federal legislation and found Congress had not regulated inactivity in the past; consequently, Vinson determined the individual mandate was a novel and unprecedented act by Congress. For a detailed analysis of the Commerce Clause and its jurisprudence, click here.

Vinson held Congress could only regulate ACTIVITY and not INACTIVITY, and ruled the individual mandate unconstitutional for violating the Commerce Clause. Why? Well, Vinson said it best: “It would be a radical departure from existing case law to hold that Congress can regulate inactivity under the Commerce Clause. If it has the power to compel an otherwise passive individual into a commercial transaction with a third party merely by asserting --- as was done in the Act --- that compelling the actual transaction is itself “commercial and economic in nature, and substantially affects interstate commerce” [see Act § 1501(a)(1)], it is not hyperbolizing to suggest that Congress could do almost anything it wanted.” Emphasis added.

Vinson then reviewed the Healthcare Law as a whole and determined the individual mandate was an integral part of the Healthcare Law and could not be severed from the larger whole. Consequently, Vinson ruled the entire Healthcare Law unconstitutional.

What comes next? Well, a battle through the Court of Appeals and upward to the Supreme Court. Stayed tuned because you can bet this battle is far from over.

*Liberty University, Inc. v. Geithner (2010), 2010 WL 4860229 (W.D. Va.); Thomas More Law Center v. Obama (2010), 720 F. Supp.2d 882, (E.D. Mich).

** Virginia v. Sebelius (2010), 768 F. Supp.2d 768 (E.D. Va).

*** United States v. Lopez (1995), 514 U.S. 549, 558-59.