What the court actually said about Obamacare and how conservatives won.

You will be hearing a lot over the next few days about the Supreme Court decision, announced today, to uphold the key provisions of the Affordable Care Act (Obamacare). Much of what you hear about the decision will be inaccurate.  I’m going to try to clarify just what the court ruled in this post based upon my reading of the actual decision.  You can download and read the full decision yourself here: http://www.scribd.com/doc/98543022/SCOTUS-ACA-Ruling

There were several issues before the court in regard to the Affordable Care Act (Obamacare). I explain how the court ruled below.  Additionally, I show that Republican/Tea Party/Conservatives actually WON.  The court actually accepted the conservative position on the two main issues before the court. 

1. Were the penalties for not having insurance fees or taxes? 

Ruling: The penalties are “fees,” not taxes.

Reasoning: If the penalties were taxes, then the plaintiffs had no standing to sue for relief because of something called the Anti-Injunction Act which says you can’t sue for relief from a tax until you are actually subject to the tax.  Since the Affordable Care penalties don’t go into effect until 2014, plaintiffs would have no standing to sue because they had not yet been subject to a tax.  The court ruled that the penalties WERE NOT a tax in terms of the application of the Anti-Injunction Act.  The wording of the Act made it clear that Congress did not intend the penalties to be treated as a “tax” for purposes of the Anti-Injunction Act.

2. Was the individual mandate a valid exercise of Congress’s power to “regulate” commerce under the Commerce Clause of the Constitution?

Ruling: NO.  The Constitution gives Congress the power to regulate commerce, not compel it.

Reasoning: Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to confessional authority.  In short, Congress does not have the authority under the Constitution to regulate inactivity.

NOTE: The court actually AGREED with Republicans/Tea Party/Conservatives on this issue.  They had argued that Congress did not have the right under the Constitution to require someone to purchase insurance (or broccoli) if they didn’t want to do so.  The court agreed.

3.  Does Congress have authority under the Constitution to impose these penalties for not having insurance under some other provision of the Constitution separate from the Commerce Clause? 

NOTE:  It is an established principal that the Supreme Court must pursue “every reasonable construction” in order to save a statue passed by the elected Congress and signed into law by the elected President from being declared unconstitutional.  The reasoning here is that the court should overrule the elected branches of government unless an Act is clearly unconstitutional.  See Hooper v. California, 155 U.S. 648, 657.

Ruling: YES.  The individual mandate may be construed as a tax from the standpoint of the Constitution and therefore the Congress can impose the tax under its power to raise and collect taxes.

Reasoning:  While the penalties are not a “tax” when it comes to the Anti-Injunction Act, they are a “tax” when it comes to the application of the Constitution based upon how the penalties are imposed and collected.  “The payment is not so high that there is really no choice but to buy health insurance; the payment is not limited to willful violations, as penalties for unlawful acts often are; and the payment is collected solely by the IRS through the normal means of taxation…Neither the Affordable Care Act nor any other law attaches negative legal consequences to not buying health insurance, beyond requiring a payment to the IRS.”  In short, the court reasoned that the penalties were really a special kind of tax levied to partially offset the expense of providing medical care to the uninsured.  It is similar to a tax on gasoline that drivers of cars must pay to help offset the cost of roads and bridges.

4.  Does the Medicaid expansion violate the Constitution by threatening states with loss of their existing Medicaid funding if they decline to comply with the expansion?

Ruling: YES.  Congress has the power under the Spending Clause to establish cooperative state-federal Spending Clause programs provided a State voluntarily and knowingly accepts the terms of the programs but Congress cannot act in a way that leaves the States no real option but to comply.

Reasoning:  The Medicaid Expansion violates the Constitution because it threatens States with loss of their existing Medicaid funding if they decline to comply with the expansion.  Such a threat is “economic dragooning” since the threat is for loss of over 10 percent of a State’s overall budget leaves States with no real choice.  Participation is no longer truly voluntary.  The court said there was a remedy.  It said the portion of the Act calling for the withdrawal of existing Medicaid funds for failure to comply was unconstitutional.  However, the other provisions calling for a expansion of Medicaid and voluntary participation by the States could stand.

NOTE:  The court actually AGREED with Republicans/Tea Party/Conservatives on this issue.  They had argued that Congress did not have the right under the Constitution to force States to participate in a expanded Medicaid program if the States choose not to do so.  The court agree.