Federal Judge in Pensacola Declares Individual Mandate In PPACA Unconstitutional, Strikes Down Entire Act
Today Judge Roger Vinson of the U.S. District Court for the Northern District of Florida – Pensacola Division agreed with Florida and twenty-five other states that the federal government cannot force its citizens to buy health insurance as it sought to do in the Patient Protection and Affordable Care Act as amended (“PPACA”). After concluding the deficient individual mandate was not severable from the remainder of PPACA, Judge Vinson declared the entire act unconstitutional. Today’s action sets up an immediate appeal to the United States Court of Appeals for the Eleventh Circuit and this issue most certainly will ultimately be decided by the U.S. Supreme Court.
The plaintiff States argued that Congress had no authority under the Commerce Clause of the U.S. Constitution to pass the “individual mandate” of PPACA — that in 2014 virtually everyone must purchase federally-approved health insurance or pay a monetary penalty. In addition, the States argued that Congress’s expansion of the Medicaid program in PPACA to include additional persons in the program and make the states responsible for the provision of those health services violated both the Spending Clause of the Constitution and principles of federalism.
In its 78-page order, the Court first upheld the expansions of the Medicaid program in PPACA. The States argued that because Medicaid is the single largest federal grant program to them, and because they and their needy residents have come to depend upon it, they must either accept the PPACA’s transformed Medicaid program, with its new costs and obligations or exit the program altogether, and lose the federal matching funds that are necessary and essential to provide health care coverage to their neediest citizens. Under either choice, the States argue that their Medicaid systems would collapse, and those most needing health care will no longer have it through Medicaid. The Court disagreed after noting that participation in the Medicaid program by the States was voluntary, thus belying the claim by the States that PPACA essentially coerced and commandeered the States through the inducement of Medicaid funds.
The individual mandate in PPACA, however, was declared unconstitutional, as was the rest of PPACA after the Court held that the individual mandate provision was not severable from the remainder of PPACA. After reviewing the Supreme Court’s Commerce Clause precedent, Judge Vinson noted that Congress’s use of the Commerce Clause to force Americans to buy a good or service was called “novel” and “unprecedented” by the government itself (Congressional Budget Office and Congressional Research Service). This attempt by Congress to regulate inactivity (failing to buy health insurance) is not permissible under the limited power of the Commerce Clause: “If [Congress] has the power to compel an otherwise passive individual into a commercial transaction with a third party merely by asserting — as was done in the Act — that compelling the actual transaction is itself “commercial and economic in nature, and substantially affects interstate commerce” . . . , it is not hyperbolizing to suggest that Congress could do almost anything it wanted.” Similarly, the individual mandate could not pass muster under the Necessary and Proper Clause of the Constitution. A law which Congress has no authority to enact can never be “proper.”
The Court then discussed whether the defective individual mandate could be severed from the remainder of PPACA. It concluded it could not be so severed. First, PPACA contains no severability clause — one was included in earlier drafts but later removed before passage — so there was no expressed intent by Congress to allow the rest of PPACA to remain in effect. More importantly, however, the Court concluded that the individual mandate was essential to the goals of the remainder of the act: “the individual mandate is indisputably necessary to the Act’s insurance market reforms, which are, in turn, indisputably necessary to the purpose of the Act.” The Court noted that it was not its role to recraft the legislation section by section: “The Act, like a defectively designed watch, needs to be redesigned and reconstructed by the watchmaker.” Because the individual mandate was “inextricably bound together” with the other provisions, the whole statute must be declared unconstitutional.
For a copy of Judge Vinson’s Order or additional information, please contact me at tcrabb@radeylaw.com.