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Supreme Court Health Reform Case Concludes With Arguments on Severability, Medicaid Expansion

Supreme Court Health Reform Case Concludes With Arguments on Severability, Medicaid Expansion

March 29, 2012 — On the third and final day of oral arguments over the federal health reform law (PL 111-148), the Supreme Court's justices turned to whether the law could stand if one of its core provisions is struck down and whether the law's Medicaid expansion is constitutional, the New York Times reports (Liptak, New York Times, 3/28). A decision is expected in late June (Block/Rovner, "All Things Considered," NPR, 3/28).

Morning Session

In the day's first session of arguments, the justices considered whether striking down the individual mandate -- which requires nearly all U.S. residents to obtain health insurance -- would mean that the whole law should be overturned.

The government argued that if the individual mandate is struck down, only two other provisions should be cut -- one banning insurers from discriminating against people with pre-existing conditions and another governing how insurers set rates. The law's challengers argued that the entire law must be struck down if the individual mandate is deemed unconstitutional (Barnes/Aizenman, Washington Post, 3/28).

The divisions between the court's conservative and liberal justices were blurred on Thursday, though their questioning suggested that most of them are at least hesitant to strike down the entire law, according to Politico.

Justice Ruth Bader Ginsberg said that if the justices have to choose between "a wrecking operation and a salvage job, a more conservative approach would be a salvage job" (Gerstein/Budoff Brown, Politico, 3/28).

However, Justice Anthony Kennedy -- who is considered a swing vote -- suggested the opposite is true. "We would be exercising the judicial power ... to impose a risk on insurance companies that Congress had never intended," Kennedy said. "By reason of this court, we would have a new regime that Congress did not provide for, did not consider. That, it seems to me, can be argued at least to be a more extreme exercise of judicial power ... than striking the whole."

Justice Stephen Breyer noted that the law contains many provisions that have nothing to do with the individual mandate and could stand on their own (Totenberg, "All Things Considered," NPR, 3/28).

Chief Justice John Roberts struck a similar vein in a response to the challengers' attorney, Paul Clement, who argued that the law would be a "hollowed-out shell" without the individual mandate.

"But (Congress) would have passed part of that hollowed-out shell," Roberts told Clement (Gerstein/Budoff Brown, Politico, 3/28).

Afternoon Session

In the afternoon session, the court's more liberal justices "hammered" states' arguments against the Medicaid expansion, Politico reports. Roberts also seemed skeptical of the states' position (Haberkorn, Politico, 3/28).

While it is long-established that the federal government can attach conditions to the money it gives states, the question before the court concerns the point at which such conditions become coercive (Block/Rovner, "All Things Considered," NPR, 3/28). The states challenging the law have argued that the Medicaid expansion -- because of the mandated coverage levels and the amount of money they stand to lose -- is unnecessarily coercive. The high court has noted previously that a condition on federal funding cannot be "so coercive as to pass the point at which pressure turns into compulsion," but it has never ruled that the federal government has overstepped its bounds by providing too much money to the states (Washington Post, 3/28).

Roberts noted that states have been receiving federal Medicaid money with strings attached for years, so "they shouldn't be surprised that the federal government has decided to pull them" (Haberkorn, Politico, 3/28).

Breyer pointed out that under Clement's logic, any expansion of Medicaid that has conditions attached would be unconstitutional (Washington Post, 3/28).

Justice Elena Kagan said to Clement, "It's just a boatload of federal money for [states] to take and spend on poor people's health care." She added, "It doesn't sound coercive to me, I have to tell you" (New York Times, 3/28).

However, Justice Samuel Alito said Congress, in passing the law, operated under the assumption that the Medicaid program had become so essential to states that there was no way they would turn down the federal government's money, which he suggested amounted to coercion (Washington Post, 3/28).