The 2010 healthcare law: Why severability is what matters

October 4, 2011

HealthcareOn August 12, 2011, the Eleventh Circuit Court of Appeals made national headlines by striking down the “minimum essential coverage” provision of 2010’s Patient Protection and Affordable Care Act (PPACA).

The infamous provision, which requires individuals to acquire health insurance or face monetary penalties under the tax code, has so far been the center of the legal war over the comprehensive health care reform.

Last week, the Department of Justice filed a petition for writ of certiorari with the U.S. Supreme Court, looking for the high court to overturn the Eleventh Circuit’s decision.

The 26 states who originally challenged the PPACA along with the National Federation of Independent Business (NFIB) also filed separate petitions to the Supreme Court, both also asking to overturn the Eleventh Circuit’s opinion.

Confused?

Although the Eleventh Circuit did indeed rule the minimum essential coverage provision unconstitutional, it also ruled that it was severable from the rest of the Act, and thus the rest of the law stands, to the great disappointment of the law’s challengers (thus, the appeals to the Supreme Court).

The severability issue will very likely be decisive to a Supreme Court ruling on the issue, but for political and ideological reasons, rather than legal ones.

The Supreme Court in WashingtonFirst of all, will this case even reach the Supreme Court?  Almost certainly.

The Supreme Court is far more likely to accept cases where there is dispute among the federal circuits on the constitutionality of a law, especially such a significant law as the PPACA.

There have been two other court of appeals decisions regarding the law, both of which have upheld the law (one ruled the law constitutional, and the other dismissed the challenge for lack of standing).

In addition, while at least one of the other appellate decisions is being appealed to the Supreme Court, the Eleventh Circuit’s 147-page opinion (longer than the two other appellate opinions combined) was exceptionally comprehensive in addressing all or nearly all of the issues thus far raised on appeal.

So when it gets to the Supreme Court, why will the severability issue be so important?

It comes down to the issue’s political implications.

Namely, that it is being used by those who oppose the rest of the Act’s regulatory scheme to garner public support for overturning the law.

Truth be told, the minimum essential coverage provision doesn’t really adversely affect businesses or states, and it actually may prove beneficial since it will purportedly operate to reduce health care costs in the aggregate.

To health insurance companies, the provision is a godsend, and if there was a way to kill every part of the Act except that provision, they would.

That provision, however, is really the only part of the PPACA that raises any significant constitutional questions (the states are also making Tenth Amendment arguments over the Medicaid expansions, but they aren’t very strong ones).

Thus, it is the only section that may be exploited to invalidate as unconstitutional the Act in its entirety.

The Supreme Court Justices are no doubt well-aware of this fact, and therefore, the staunchly conservative elements of the Court (Scalia, Thomas, and possibly Alito) will not settle for a ruling that does not invalidate the Act in its entirety.

Conversely, the Eleventh Circuit’s discussion on the severability issue was very thorough, and frankly, a great deal of Supreme Court precedent on the issue would have to either be completely disregarded or overruled to not sever the minimum essential coverage provision.

That possibility itself relies on the assumption that a Court majority will even find the provision unconstitutional.

Chief Justice John RobertsHowever, given the unpredictability of Kennedy and Roberts (who so far has typically based his decisions on legal, rather than ideological bases), that assumption is not a sure thing.

In the end, the Eleventh Circuit’s opinion may very well reflect a future Supreme Court compromise on the case.

The striking down of the minimum coverage provision would both be a political blow to the Obama administration and serve as a limit on congressional Commerce Clause powers, attracting the Court’s conservatives.

To appeal to the Court’s liberals: severing the provision from the rest of the Act would leave rest of the regulatory provisions intact, arguably the most important parts of the law.

This, of course, is all speculation, and since the Supreme Court hasn’t failed to surprise on several occasions, we really don’t know how they will rule.

We will, though, almost surely find out just how the Court will rule on the issue by June 2012, the end of the Court’s current term.

Check out our earlier posts on legal challenges to the PPACA:

The post on Judge Hudson’s Spending Clause discussion can be viewed here

The post on Judge Vinson’s Commerce Clause discussion can be viewed here.  

The post on severability can be viewed here.

The post on congressional regulation of inactivity can be viewed here.