Health Care Law: Two Eagerly Anticipated Rulings Expected This Summer

WASHINGTON, Aug. 3, 2011 -- Although challenges to the Obama administration's health care law are being heard across the country, two important appellate court rulings are expected this summer that could determine whether the issue eventually lands in front of the Supreme Court.

The heart of the issue is whether the individual mandate -- a key provision of the Affordable Care Act (ACA) that requires most individuals to buy health insurance by 2014 or pay a penalty -- is constitutional. Critics of the ACA say Congress exceeded its authority when it passed the law.

Appellate Rulings so Far

Only one appellate court has ruled on the issue. In June a divided panel of judges from the Sixth Circuit Court of Appeals found in favor of the Obama administration in a challenge brought by the Thomas More Law Center, a public interest law firm, and four individuals.

The ruling was significant because it marked the first time a judge appointed by a Republican president voted in favor of the mandate. Judge Jeffrey S. Sutton was nominated to the bench by George W. Bush and he clerked for conservative Justice Antonin Scalia.

Bradley Joondeph, a law professor at Santa Clara University points out that Sutton is considered an "intellectual leader among judicial conservatives" with a long record of supporting the cause of federalism -- and limiting the power of the federal government vis-a-vis the states.

"His opinion shows that principled conservatives can conclude that the law is constitutional," Joondeph said. "This, in turn, makes it much easier for a conservative Supreme Court justice -- such as Justice Kennedy or Chief Justice Roberts--to reach the same conclusion."

Upcoming Rulings

Fourth Circuit: Arguments heard May 10 in Richmond, Va.

A panel of three judges heard two cases: Liberty University v. Geithner and Virginia v. Sebelius. The panel consisted of Judge Diana Gribbon Motz, nominated to the bench by President Bill Clinton, Judge Andre M. Davis and Judge James A. Wynn Jr., both appointed by President Barack Obama but chosen by a random computer model.

Although the panel seemed receptive to the Obama administration's arguments on the constitutional merits, the panel also hinted it might throw out one of the cases on jurisdictional issues.

In both cases the government argued that Congress was well within its authority to regulate interstate commerce when it passed the individual mandate.

Acting Solicitor General Neal Katyal (who has since left his job to join the private sector) said that health care is a unique market and that even if an individual chooses not to buy health insurance, that choice still makes an economic impact across the country. He pointed out that in 2008 alone the costs of the uninsured cost other market players $43 billion.

Liberty University, a Christian College, argued that while the Constitution might allow congress to regulate interstate economic activity, it can not regulate an individual's choice not to buy health insurance.

Matt Staver, a lawyer for the school, said that an individual's choice not to enter a marketplace is an "inactivity" outside the reach of Congress under the Commerce Clause.

In the second case, a challenge to the law brought by the Commonwealth of Virginia, the government argued that the judges should throw the case out before even considering the merits. Katyal said that Virginia did not have the legal right or "standing" to bring the case in the first place because the individual mandate applies only to individuals and not the Commonwealth.

Lawyers representing Virginia argued that the federal law interferes with a state law already on the books that says residents cannot be forced to buy health insurance.

Eleventh Circuit: Arguments heard June 8 in Atlanta.

This challenge is brought by 26 states, the National Federation of Independent Businesses and two individual plaintiffs. The panel consisted of Judge Frank M. Hull and Judge Stanley Marcus, both Clinton appointees, and Chief Judge Joel F. Dubina, a George H.W. Bush nominee.

Paul Clement, considered one of the finest appellate lawyers in the country, represented the states and argued that the case turns on "whether or not the federal government can compel an individual to engage in commerce."

Clement also argued that Congress had gone too far in passing another provision of the law that expands the reach of Medicaid. Clement said the law will force the states to add significant administrative expenses and force them to eventually cover more citizens through Medicaid. According to the law, the federal government will initially fund 100 percent of the expanded benefits.

Because the challenge to the Medicaid provision is applicable to the states, the government does not challenge their legal right to bring the case.

District Court Judge Roger Vinson, the lower court judge who heard this case, ruled against the administration, going further than any other judge by throwing out the entire law.

"I must conclude that the individual mandate and the remaining provisions are all inextricably bound together in purpose and must stand or fall as a single unit," he wrote.

Will the Challenges Reach the Supreme Court?

The cases from the two appellate courts are eagerly anticipated because the Supreme Court is likely to wade into an issue if there has been a split at the Circuit Court level.

Although the District Court judges hearing the issue broke down on partisan lines, some wonder whether Sutton's appellate court opinion will sway other conservative appellate judges hearing the issue.

"There is no guarantee that this litigation will ultimately reach the Supreme Court. If the circuit courts follow the lead of the Sixth Circuit and Judge Sutton, these courts will find for the ACA under clear Supreme Court precedent and the Constitution's text and history," says Elizabeth B. Wydra, chief counsel of the Constitutional Accountability Center, which supports the law.

"Because the district courts have so far decided the issue on such partisan lines, it has made it more of a significant constitutional dispute than I would have ever expected," said Dawn Johnsen, a professor of law at the Maurer School of Law at Indiana University, who also supports the law.

"The extensive litigation and commentary make the constitutional issue seem more difficult than it is," she said. "It is a straightforward case of Congress regulating interstate commerce on an economic issue of tremendous national significance. To say or hold otherwise is a dramatic departure from precedent and an extreme new limit on congress' power to regulate on issues of national importance."

But in a post to the popular website, Scotusblog, Robert Levy chairman of the Cato Institute, a public policy think tank devoted to individual liberty and limited government, says an eventual circuit split is "likely."

"No one could plausibly argue that the Commerce Power is so elastic as to compel the purchase by every American of an unwanted, government-designed product from a private company," he writes.