Legal Docket - Obamacare, take three

NICK EICHER, HOST: It’s Monday morning and we’re glad you’re here for another week of The World and Everything in It. Today is the 16th of November, 2020. 

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EICHER: It’s time for Legal Docket. Today, Obamacare: take three. Or as Justice Samuel Alito put it during oral argument last week:

ALITO: This does seem like deja vu all over again…

REICHARD: I’d have to agree with that! 

And it’s not surprising. The Affordable Care Act—Obamacare—came into being without bipartisan support. It was cloaked in secrecy even during the writing process.

OBAMA: Let me just start by setting the record straight on a few things I’ve been hearing out here.

And President Obama said some things that turned out to be untrue.

OBAMA: Under the reform that we are proposing: If you like your doctor? You can keep your doctor. If you like your healthcare plan? You can keep your health care plan.

EICHER: That was the nature of the debate, such as it was, that led to passage of Obamacare more than 10 years ago. 

But many millions of people did lose their doctor and did lose health insurance plans and saw costs spiral out of control. But it’s also true that others gained health insurance.

The Supreme Court has already twice rescued Obamacare from constitutional challenges.

REICHARD: Here’s a brief refresher. 

Obamacare became law in 2010. It required most Americans to either buy health insurance or else pay a hefty penalty. Democrats cited the Constitution’s Commerce Clause as authority to demand that citizens buy something. 

Two years later in 2012, the Supreme Court heard the expected challenge that was overreach. A majority five justices agreed that the individual mandate violated the Commerce Clause because it required Americans to buy something. The Constitution does not grant the federal government police power like that over individuals. But the majority 5 still saved the law by construing the penalty as a tax that raises revenue. That is under Congress’ power. This, even though President Obama said the mandate was not a tax.

EICHER: Three years later in 2015, the Supreme Court upheld a separate challenge to the way the IRS extended tax credits.

Then in 2017, a Republican Congress zeroed out the penalty for failure to purchase health insurance as part of tax reform, cut the “penalty” or “tax,” whatever you like, to zero.

REICHARD: And that’s the crux of the current argument: Is the individual mandate, with its penalty zeroed-out,  unconstitutional? After all, Democrats said Obamacare wouldn’t work without the penalty. 

So this time around, 18 Republican-led states sued on the theory the mandate cannot be a tax any longer because it raises no revenue. That’s the very definition of taxation.

Therefore, the whole law must fall because it rests on a fallacy. 

On the other side, 16 Democrat-led states defend the law. They argue taking away the penalty merely turned purchasing insurance into an exhortation to do something, a person’s choice.

Former Solicitor General under President Obama, Donald Verrilli, argued in support:

VERRILLI: There is just no way that Congress would have preferred an outcome that throws 23 million people off their insurance, ends protections for people with preexisting conditions, and creates chaos in the health-care sector.

Caveat, though: that law? It’s still on the books. So who’s to say the  government can’t about-face and require you buy insurance?

Arguing against Obamacare on behalf of the federal government, Acting Solicitor General Jeffrey Wall. He mentions “shared responsibility payment.” 

That means the mandate penalty.

WALL: This case pushes at the line between faithfully following what Congress actually does, rather than what it may have intended to do. When Congress eliminated the shared responsibility payment, it left standing what is now a naked command to obtain insurance and it left standing the findings that that mandate is essential to the operation of other parts of the Act. Those choices have legal consequences.

Justice Alito pointed out the strange facts of this case with regard to the first Obamacare challenge versus this one:

ALITO: At the time of the first case, there was strong reason to believe that the individual mandate was like a part in an airplane that was essential to keep the plane flying so that if that part was taken out, the plane would crash. But now the part has been taken out and the plane has not crashed.

Creating a conundrum should the court side with the Republican states: how can we say the mandate is essential to the operation of Obamacare, when in actual practice, it clearly is not essential? 

Arguments touched on who has standing to sue. But the bulk of the argument dealt with the legal concept of severability. That is, can the mandate be severed, cut out, removed, and yet still leave the rest of the law intact? 

Justice Kavanaugh seemed to think you could.

KAVANAUGH: Looking at our severability precedents, it does seem fairly clear that the proper remedy would be to sever the mandate provision and leave the rest of the act in place—the provisions regarding pre-existing conditions and the rest. How do you get around those precedents on severability, which seem on point here?

Lawyer for the Republican states, Texas Solicitor General Kyle Hawkins,  pointed to the text of the statute. It says the mandate is absolutely essential for Obamacare to function. How can something be crucial to the whole and yet severable from it?  

Justice Kavanaugh’s inclination to rescue the law aligned with Chief Justice Roberts. Listen to his comment to Hawkins, again for Texas:

ROBERTS: It’s hard for you to argue that Congress intended the entire act to fall if the mandate were struck down when the same Congress that lowered the penalty to zero did not even try to repeal the rest of the act. I think frankly that they wanted the Court to do that.  But that’s not our job.

Hawkins countered it is the court’s job to follow the text of the law. (And I need to clarify here that the chief justice may not be exactly right. He’s correct if he means Congress in 2017 and 2018 failed to repeal Obamacare. But he’s incorrect if he means literally what he said, that Congress didn’t even try. Republicans in Congress did try. They simply failed to win enough votes to succeed.)

One thing’s certain: the longer Obamacare is around, the more economic reliance on it grows.  

Several possible outcomes are possible. But I think it’s most likely that the Chief Justice and Justice Kavanaugh will join with the liberal Justices Breyer, Sotomayor, and Kagan to save Obamacare. Again.

Now, a brief treatment of the very first case in which Justice Amy Coney Barrett participated.

ROBERTS: We will hear argument first this morning in Case 19-547, United States Fish and Wildlife Service versus Sierra Club.

This dispute is over the scope of The Freedom of Information Act. That’s a federal law that provides that any person has a right to request access to federal agency records. 

Here’re the facts: Nine years ago, the EPA proposed a regulation for use in power plants. Agencies that protect animal life wrote draft opinions that said the proposed regulation would hurt endangered species.  So based on those warnings, EPA changed its proposal. 

An environmental group called The Sierra Club made a FOIA request for those early drafts of the proposal. EPA declined the request, citing an exemption that says no disclosure is necessary if the documents deal with what the agency calls the “deliberative process.”  

Justice Clarence Thomas had a basic question about that for Sierra Club’s lawyer, Sanjay Narayan:

THOMAS: How far back in the process can we go before it is not discoverable and it’s a part of the deliberative process, as opposed to something that is subject to FOIA?

NARAYAN: Well, I mean, in this case, I think the important thing is that … this analysis that it’s a jeopardy opinion was complete and reached a conclusion.

In other words, nothing about that conclusion says “deliberative process.” He suggested a test for the court to adopt: if a draft document has “appreciable legal consequences,” then it should be disclosed.

But lawyer for the government against disclosure, Matthew Guarnieri, argued the opposite. These documents are, his words, the “molten core of the deliberative process.” That’s privileged and exempt from FOIA disclosure.  

Justice Kavanaugh pointed out that agency officials might just slap a “draft” stamp onto everything to evade FOIA.

Justice Amy Coney Barrett picked up on that:

BARRETT: You said that if a government official simply stamps “draft” on it and sent it over and, as Justice Kavanaugh is positing, did so in order to avoid FOIA disclosure requirements, you said that a court might look at other factors to determine whether it’s still final. What other factors would a court consider?

GUARNIERI: I think a court might look…

Sierra Club had an odd bedfellow here: the National Association of Home Builders. Each desires access to government documents that illuminate government thinking. 

And that’s this week’s Legal Docket.

(AP Photo/Alex Brandon) A demonstrator holds a sign in front of the U.S. Supreme Court as arguments are heard about the Affordable Care Act, Tuesday, Nov. 10, 2020, in Washington. 

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