Health insurance bill trampling state rights?
Jenson Hagen
Lawsuits are coming out of state attorney general offices claiming that this new health insurance reform is unconstitutional. The Federal government relies on a loose interpretation of the interstate commerce clause to justify passage of so much legislation.
Still, it would not matter if this legislation were unconstitutional if Oregon passed a parallel bill.
We have a history of passing legislation in tandem with what the Federal government prescribes. The Fair Labor Standards Act required a minimum wage and Oregon passed a tougher minimum wage ballot measure that imposed a higher minimum wage rate. It would not matter if the FLSA were repealed because Oregon has had tougher laws on the books for years.
Federal civil rights legislation doesn't even cover small businesses. A company with few employees could still discriminate against patrons. Oregon passed civil rights legislation that applies to all businesses. It would not matter if Federal civil rights acts were repealed because Oregon has tougher laws already in place.
These health insurance reforms are borderline pathetic. As a state, we should have passed many of them years ago to protect Oregonians. Instead of griping about constitutionality of this new health care legislation, let's pass these reforms into law ourselves and codify them at the state level.
Who knows? Maybe we could throw in a public option!
10:10 a.m.
Mar 24, '10
Jenson, there are quite a few policy areas where federal law specifically pre-empts state action. Are there any in the area of health care?
10:25 a.m.
Mar 24, '10
Constitutionally, Congress has the preeminent power to regulate interstate commerce, which for the last 200 years has been interpreted by the courts as anything with a potential economic impact.
So the Constitutionality question will be judged on this standard: does this bill relate to any issue with a potential economic impact on the nation?
I think the answer to that question is so obvious, that even a teabagger would be able to figure it out.
Mar 24, '10
Oregon has already passed most of these reforms. Please take a look at HB 2009 and 2116 (creation of a Health Authority and a citizen oversight board; low income subsidies; expanded OHP/SCHIP eligibility for children; plans for an exchange and public option; administrative simplification of insurance transactions; medical home delivery models; provider reimbursement reform; transparency and heightened scrutiny of insurance rate setting; transparency of insurance administrative costs; public health education programs; healthcare workforce training; planning for an individual market with guaranteed issue and an individual mandate—this is just a sampling of the extensive reforms). Also, Oregon has had an extensive patient protection act in the Insurance code for years. This includes external review of insurance medical necessity determinations. Oregon has guaranteed issue and guaranteed renewability of small group health coverage (2-50 employees). Small group is also subject to narrow 3x1 rate bands—meaning the oldest sickest groups can’t be charged more than 3 times the rate of the youngest healthy groups. Small groups can’t be canceled nor can they have their rates increased because someone gets sick. Individual insurance in Oregon is medically underwritten using a standard insurance regulator application. Those who are denied coverage in the individual market because of medical conditions are automatically eligible for coverage in the Oregon high risk pool (OMIP), and health insurers are assessed a tax to subsidize the premium rates in the OMIP pool. In Oregon, Individual coverage is guaranteed renewable, and if you get sick the coverage can’t be canceled, nor can the rates be increased.
11:09 a.m.
Mar 24, '10
Lawrence O'Donnell and Thom Hartman are both on the right track considering the single datapoint of "madatory purchase".
21 (or 17 or something) state's AGs are calling it preemtion, but it's really a tax, which can be avoided by purchasing insurance.
It should be a slam dunk for us, but with the makeup of the supreme court, who knows?
Mar 24, '10
The health insurance reform package that is drawing the attention bears a strong resemblance to what Republicans offered as an alternative, sixteen years ago, to Hillary care.
What great progress.
Mar 24, '10
This constitutional question is a valid one, and is hardly clear. The standard is not whether the bill "relate[s] to any issue with a potential economic impact on the nation."
The question is whether the federal government has the power, not to regulate economic activity, but to require economic activity where none is present. By forcing people to purchase insurance or be fined, it looks quite a bit like a capitation tax, which is expressly prohibited by Article 1 Section 9 of the constitution.
So there is both a Commerce Clause problem here as well as 1/9 problem.
This is not a slam dunk either way.
Mar 24, '10
Georgetown law professor writing in the Wash Post:
"But the individual mandate extends the commerce clause’s power beyond economic activity, to economic inactivity. That is unprecedented. While Congress has used its taxing power to fund Social Security and Medicare, never before has it used its commerce power to mandate that an individual person engage in an economic transaction with a private company. Regulating the auto industry or paying “cash for clunkers” is one thing; making everyone buy a Chevy is quite another. Even during World War II, the federal government did not mandate that individual citizens purchase war bonds."
Not sure if the Commerce clause can be stretched this way Steve. Could there be some nasty unintended consequences of this kind of interpretation, depending on the party or person in power down the line? If this holds, passage of a cap and trade ought to be a breeze.
Mar 24, '10
Would this be an issue if the interstate commerce clause hadn't been so obfuscated by DEA policies for years?
One of those electorate attention span issues...
Mar 24, '10
The individual mandate will go down hard. It's not even close to presumptively constitutional.
Mar 24, '10
Kari ChisholmJenson, there are quite a few policy areas where federal law specifically pre-empts state action. Are there any in the area of health care?
Check out ERISA. It heavily pre-empts state action in health care and pension plans.
Actually, Oregon is closer to a full public option/exchange than most people realize: merge the OEBB, PEBB and OHP programs. Allow any business to buy in at the same price as state agencies/local schools. Allow individuals to do so, with subsidies for the poor. Bingo. Public option/exchange on exactly the model Wyden proposed. Do absolutely nothing else to insurance companies; let them compete with that as an alternative, and make sure we always have three or four companies represented in the exchange to keep it competitive "inside" the exchange as well.
It also solves a vexing political problem on the Left: complaints about "over paid" public employees. Any business could buy the same benefit plan, at the same group rate public employees get.
Mar 24, '10
Why do you need to rely on the commerce clause to justify the mandate when it's really part of the tax code? The feds encourage/discourage all kinds of activities through adjustments of the tax code. You already get a tax break for buying health insurance, the mandate is just an expansion of that.
Are there other parts of the health plan being challenged on constitutional grounds?
Mar 24, '10
The mandate is an expansion of the tax credit? Really? Really? Help me out here, because I am incredulous that someone could buy that whopper.
Name one, just one instance, where the federal government has heretofore required individual citizens to buy a product provided completely by the private sector or face some legal chin music?
Just one. Pretty please.
The concept here is taking an unfunded mandate right down to the individual citizen level. Congress is not constitutionally empowered to do that and never has been.
6:39 p.m.
Mar 24, '10
where the federal government has heretofore required individual citizens to buy a product provided completely by the private sector
The federal government isn't requiring you to buy from any private company. They are taxing you and then telling you that you can avoid the tax by purchasing insurance.
Like it or not, there are lots of precedents for that. A few years ago, the City of Sandy needed money for street repair. They assessed a tax on all Sandy homes and businesses, and then put a gas tax on the ballot, which, if passed would negate the previously imposed tax. It passed overwhelmingly, and the ARC0 station somehow, miraculously stayed in business.
Reminds me of an old song from my Christian days. "God does not compel you to go against your will. He just makes you willing to go".
If you make over $43,000 you can probably afford the few hundred bucks, and if you make less, you get help.
Mar 24, '10
Pat Ryan - we citizens buy into the tax code and IRS or local enforcement because everyone uses the common services rendered - pot-hole free streets, fire, police, sewer, schools, Social Security, etc.
These are excise or income tax and are based on using or doing something.
Congress is now attempting to levy a direct tax for the act of doing absolutely nothing. And doing nothing doesn't constitues an act of commerce.
The Constitution requires that a direct tax like this be apportioned among the states according to their population, as determined by the census.
Mar 24, '10
Next the federal government will be telling everybody to install solar panels or a geothermal heating system. If you don't retrofit your home with a super energy efficient system you will be fined $2,000. The federal government will argue that if every individual American doesn't become super energy efficient it will result in electric companies generating electricity with coal. This will release atrocious greenhouse gases like carbon dioxide which is incredibly difficult for non-plants to convert into oxygen. And of course it is an absolute fact that greenhouse gases cause global warming and that is bad for the health of all Americans (their general welfare).
10:24 p.m.
Mar 24, '10
Name one, just one instance, where the federal government has heretofore required individual citizens to buy a product provided completely by the private sector or face some legal chin music?
This isn't federal but the same idea applies: A few years back, my neighbor developed a minor crack in his sewer line. He did, of course, hire someone to fix it.
When pulling the permit, the city realized that his sewer connected to my sewer before they went out to the street -- what they call a "party sewer".
As a result, the city required me to disconnect my sewer (something they had permitted decades ago on this property) and pay a private contractor to place a new sewer line out to the street - even though mine was perfectly fine.
In other words, the city forced me to hire a private firm to provide a service I did not need, did not want, and was not necessary for any health or safety purpose. They just don't like party sewers any more, even though they'd been approving them for around a century.
I didn't like it, but I don't doubt that it's legal and constitutional. (And frankly, I think the city should pffer low-interest loans, instead of making me borrow the money from a contractor. Call it a public option for city-mandated sewer repairs.)
Mar 24, '10
The "mandate" tax penalty is $695 per person. To put that in perspective the current tax credit per child is $1,000 and the "Making Work Pay" tax credit is $400 per adult. The mandate penalty is very much on the same scale as other adjustments in the tax code, there is nothing unprecedented about it.
Mar 25, '10
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Mar 25, '10
Nice head fake bjc, but the dollar amount of this fine relative to a tax incentive won't be germane to a Constitional argument over State rights.
The fine is based on inactivity, plain and simple. For the Federal government to enforce, it would indeed be unequivocally unprecedented.
Tax incentives are based on activity. To realize tax credits you have to be a wage earner.
Who is John Galt?
Mar 25, '10
Sorry Right Wingers,
Since Bush v. Gore, and the Right Wing Federal judges stopped the counting of State of Florida ballots, there are no states rights anymore.
Mar 25, '10
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Mar 25, '10
The argument that the individual must-buy mandate is actually a tax and is therefore justified by Congress's taxing power is, in a word, absurd.
Try this test: All government revenues must be accounted for by the government and all spending must be through Congressional appropriation. If it doesn't come in through to the government coffers and go out under a duly passed and signed spending bill, it ain't a tax, whatever it is.
Mar 25, '10
Re: The Chisholm sewer: the difference, sir, is that states DO have unlimited plenary power to regulate for the public health, safety, and welfare, called "police power" by the legal beagles, the better to obscure their meaning. Cities are creatures of the state and draw on that same power.
Conversely, the federal government does NOT have police powers. The federal government is, by design, a government with only the enumerated powers given to it in the constitution. Whereas states operate under "That which is not forbidden may be done," the federal government operates under "That which is not given to us to do may not be done."
So there is no relevance to your sewer in the health care mandate discussion. If the feds had tried to force you to do something with your sewer and you pushed back, they'd have had to show a connection to an interstate waterway or have their meddling stopped.
The pro-mandate argument under the Commerce Clause boils down to "We've stretched the Commerce Clause so far into absurdity over the years that there's no point in stopping when it comes to health care." To the contrary, this is a wholly new thing-- the federal government trying to shoehorn the Commerce Clause into a rule that allows them to regulate anyone, even those choosing NOT to engage in Commerce.
Mar 25, '10
Both Kari and Pat gave somewhat analogous examples of local governments enforcing something similar to an individual mandate.
But these examples aren't germane in a question of constitutional law, because the federal government powers are enumerated, while the state and local powers are not. State and local governments' authority for action is under the general police power. Federal authority is far more restricted to those actions that are specifically enumerated in the constitution.
So that brings us back to the Commerce Clause. The argument will have to be that mandating economic activity is the same as regulating economic activity. That is a huge stretch of the Commerce Clause, and would establish a precedent that could result in all sorts and manner of government mischief in forcing us to do things.
If you try to retreat into the taxing authority of the federal government, arguing that there is not really a mandate to buy something, just a tax if you don't buy it, you are now violating the explicit constitutional prohibition on a capitation tax.
So again, the constitutional challenge will be a close call, maybe even a leaner against.
7:58 a.m.
Mar 25, '10
Posted by: Steve Maurer | Mar 24, 2010 10:25:00 AM
Constitutionally, Congress has the preeminent power to regulate interstate commerce, which for the last 200 years has been interpreted by the courts as anything with a potential economic impact.
Steve, that is wrong. Wickard v. Filburn (1942) is generally pointed to as the major precedent for federal government regulation of the economy. At 68 years old, it's barely younger than Brown v. Board of Ed, and this SCOTUS has shown no penchant for honoring precedent.
Mar 25, '10
Pat Ryan, of course, doesn't have a clue but that doesn't stop the ignorant from talking an removing all doubt. O'Donnell and Hartman are just doing their bit to stay in the good graces of the audiences who pay their checks. Since Courts sometimes, shall we say, "bend" the law based on popular opinion, the advocates of this corporate welfare system are hoping they can mislead and otherwise shape popular opinion enough to pressure the courts.
It's not a tax, becaus it only exists as an enforcement penalty for an unconstitutional requirement. Wyden actually latched onto this in his original bill he developed as he talked with the industry and worked with Republican "allies" rather than Democrats. Congress said they were explicitly including a mandate for the benefit of the insurance companies. Obama even said in one speech in the run-up to the vote that it was because the insurers tell him and the Congress people won't buy insurance without the mandate. So they never considered it as a tax and didn't pass a tax.
Moreover, even if you pay the fine, you don't have any insurance yourself because that money is actually budgeted in the CBO scoring to the subsidies for low income people to buy private insurance. So it's legislative text, the testimony of those who created and supported it, and the use, distinguish it from a tax.
We are now just seeing NewSpeak attempts to spin it: "We've always been at war with Eastasia"
Mar 25, '10
In other words, the city forced me to hire a private firm to provide a service I did not need, did not want, and was not necessary for any health or safety purpose. They just don't like party sewers any more, even though they'd been approving them for around a century.
Kari helpfully provides another example of his ignorance and why he is nothing but an empty propagandist.
Kari, you are only required to fix your sewer because you CHOSE to buy a house. No one required you to buy a house or the sewer line attached thereto. Once you made that choice, you AGREED to maintain it as part of the deal. Just like the you AGREED to maintain the sidewalks. And you AGREED to buy car insurance if you CHOSE to buy a car.
This fine is quite different because Congress has said BECAUSE you live, you must do business with the private insurance industry. It is a unique and egregious form of corporate welfare, an dangerous event in U.S. history if it stands. And it was brought to us by those who have killed the Democratic Party from the inside, not unlike parasitic wasps that lay their eggs inside living insects so their parasitic larvae can grow until they finally kill their host and break out to predate again.
Actually I've been waiting for Frank Luntz's spin for this: Will it be: "The Breathing Fine", "The Life Fine", "The Living Fine"?
Anybody sheeple who listens to the "arguments" of Thom Hartmann and O'Donnell after they have shown themselves to be completely intellectually uncredible as they have "adapted" to the arguments of the pro-industry-welfare wasps that have parasitized the Democratic Party is a fool.
And by the way, Pelosi is already laughing at you sheeple, she's duped:
Pelosi: Health Care Bill a Conservative Bill (Time to Go Back Under the Bus, Veal Pen)
As of this morning, it looks like the Republicans have found the grounds to force reconciliation back to a House re-vote:
Health bill to face fresh House vote
This would be the chance for those who have lied and misled the public to this point about their true intentions to revive the public option, but I'm not holding my breath.
Mar 25, '10
Whether the "health care reform" that just passed the House tramples on states' rights or not may very well become irrelevant when the realities of the shortcomings of this new deal become apparent. The Obama administration and their accomplices in the House succeeded with their policy of divide and conquer to get this bill through thus reducing hopes of improving amendments to illusions. This is a bonanza for the insurance corporations and they are not going to tolerate Congress and the White House whittling down their gains after they spent hundreds of millions to get this bill through.
Mar 25, '10
Could Congress require you to "tithe" 10% of your gross income to the 501(c) religious institution of your choice or face a penalty equal to 10% of your gross income on your tax return? Church organizations do engage in economic activity, much of which is across state lines when money moves from the local organization to the headquarters in Rome or Salt Lake City or whereever. If the Commerce Clause can stretch to accomodate mandatory insurance, it seems it could stretch to cover all sorts of mandatory activities. And, if buying insurance against bodily injury or illness is good for you, surely buying insurance against the everlasting fires of Hell is also good for you?
Inquiring Minds Want to Know.
Mar 25, '10
Amen, Adam. Spot on as usual.
Name one, just one instance, where the federal government has heretofore required individual citizens to buy a product provided completely by the private sector or face some legal chin music?
I'm totally blown away. I had no idea that "chin music" had any meaning outside of cricket, where it's been a popular term since 1932 when Surrey captain Douglas Jardine introduced the concept. Baseball fan I guess?
Who is John Galt?
Who mentioned John Galt? It would be a reference to Ayn Rand (usually reduced by crude minds to "equals Libertarianism") an her book "Atlas Shrugged". The sentiment invoked for this discussion, would presumably be, "I swear by my life and my love of it that I will never live for the sake of another man, nor ask another man to live for mine."
If that's the essence of Libertarianism, then I need to re-register.
Mar 25, '10
Conversely, the federal government does NOT have police powers. The federal government is, by design, a government with only the enumerated powers given to it in the constitution. Whereas states operate under "That which is not forbidden may be done," the federal government operates under "That which is not given to us to do may not be done."
That's what the Constitution says, but its not the reality on the ground. As I asked at the beginning of this, would this be so bloody confounded if the Feds hadn't been using the same illogic to regulate medical marijuana and assisted suicide?
Anybody sheeple who listens to the "arguments"
Could you please email Kari and let him know how to subscribe to whatever dittohead list it is that gives you your "word of the day"? It would be nice, no doubt, to be able to proactively manage the spam filter. So called arguments? How are they not actually arguments? Glenn needs to include grammar hints along with his word of the day.
Posted by: The Law | Mar 25, 2010 8:14:14 AM
The Law is meant to be broken!
Mar 25, '10
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