Opinion: Obamacare’s individual mandate survives again

A federal appeals court rejected yet another legal challenge to Obamacare’s individual mandate Friday -- so resoundingly, in fact, that even the dissenting judges dismissed the challengers’ core constitutional argument.

The suit -- Sissel v. the Department of Health and Human Services -- was brought by artist Matthew Sissel of Washington, who objected to the requirement in the 2010 Patient Protection and Affordable Care Act that virtually all adult Americans carry health insurance. Backed by the Pacific Legal Foundation, he argued that the individual mandate was unconstitutional because it was a revenue-raising measure (that is, a tax) that originated in the Senate, contrary to the constitutional requirement that all revenue bills originate in the House.

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FOR THE RECORD

An earlier version of this post identified the plaintiff as Timothy Sissel. His first name is Matthew.

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On one level, the case seems a desperate attempt to strangle the individual mandate with the rope the Supreme Court used to save it in 2012. That year a fractured court held that the mandate was a legal exercise of Congress’ power to levy taxes, if not necessarily a constitutional use of its power to regulate interstate commerce.

The bill that President Obama signed into law as the Affordable Care Act was a House bill -- HR 3590 -- which seems to satisfy the constitutional requirement that it originate in the House. Sissel’s attorneys argued, however, that the original House bill wasn’t really a revenue bill because it dealt with an expiring tax credit for first-time home-buyers. The Senate can’t satisfy the constitution’s origination clause by gutting and amending any old House bill into a tax measure, Sissel’s lawyers argued.

That’s an interesting and consequential argument, but it’s gone nowhere at two levels of the federal judiciary. District Judge Beryl A. Howell ruled in June 2013 that the ACA wasn’t a “Bill for raising revenue,” so the origination clause didn’t apply. And even if it did, she wrote, the bill clearly originated in the House, and the Supreme Court has held that it’s not the courts’ job to decide when a Senate amendment is or isn’t germane to a House bill.

Three judges from the U.S. Court of Appeals for the D.C. Circuit upheld Howell’s decision in July 2014, agreeing that the ACA was not a “Bill for raising revenue” but rather a measure that raised revenue to serve another purpose (namely, to extend health coverage to lower-income Americans). Sissel appealed again, asking the full circuit to rehear the case, and on Friday that request was denied.

What’s interesting about the denial is that four of the 11 judges wanted to grant the petition to rehear the case -- and not because they disputed the bottom line of the decision, which was to affirm the constitutionality of the individual mandate. They also agreed with Howell that the mandate complied with the origination clause. Instead, they didn’t agree with the three-judge appeals panel that the ACA wasn’t a “Bill for raising revenue” within the meaning of the Constitution.

As Circuit Judge Brett Kavanaugh put it, “The Affordable Care Act established new subsidies for the purchase of health insurance and expanded the Medicaid program for low-income Americans. Those new subsidies and expanded entitlements cost an enormous amount of money. So as not to increase the annual budget deficit and the overall national debt, the Act imposed numerous taxes to raise revenue. Lots of revenue. $473 billion in revenue over 10 years. It is difficult to say with a straight face that a bill raising $473 billion in revenue is not a ‘Bill for raising Revenue.’”

Kavanaugh and his fellow dissenters disagree fundamentally with the idea that the origination clause applies only to measures that raise revenue for the purpose of raising revenue. In their view, any measure that raises a significant amount of money for the Treasury falls within the clause’s purview. And that, they argue, is clearly the case with the ACA.

“[T]he purpose of the Act was to overhaul the national healthcare system and to raise revenue. You couldn’t do the former without also doing the latter,” they write.

The three judges from the original panel responded that the dissenters’ approach would apply the origination clause to any measure that raised money to offset the costs of the programs it created unless the revenue was designated specifically for those programs. The Supreme Court has previously imposed no such need for designation, the judges wrote; instead, its most recent word on the subject (from a 1990 case) is that “a statute that creates a particular governmental program and that raises revenue to support that program, as opposed to a statute that raises revenue to support Government generally, is not a Bill for raising Revenue within the meaning of the Origination Clause.” In the panel’s view, “The [Supreme] Court could have been talking about the ACA.”

The back-and-forth is great reading for tax policy nerds, but that’s little consolation for the Pacific Legal Foundation. As concerned as they were about the precedent the panel’s ruling would set for origination-clause disputes, the D.C. Circuit’s dissenters weren’t the least bit persuaded by Sissel’s argument that the ACA violated the clause. Here’s their summary of that issue:

“The Origination Clause imposes no germaneness requirement on the Senate when it amends revenue-raising bills that originated in the House. That is apparent from the text, history, and precedent of the Origination Clause.”

The foundation said Friday that it will ask the Supreme Court to review the case, apparently hoping that Chief Justice John Roberts is eager for a third chance to decide the law’s fate. Of course, they don’t need Roberts’ support to persuade the justices to hear their appeal -- any four justices will do. And there just happen to be four who dissented when the court upheld the individual mandate in 2012, so ... .

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