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November 21, 2017

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Supreme Court on health care law: Can you take the heart and leave everything else?

All that’s left to do is wait for a decision. The Supreme Court wrapped up the courtroom portion of the health care case with a third and final day of arguments Wednesday focusing on the government’s worst-case scenario: what to do with the rest of the law if the health care mandate is rendered unconstitutional.

Twenty-six states, including Nevada, sued the federal government in 2010 after Congress created a law to expand the reach of health coverage and bring down costs through a system of insurance exchanges and a mandate that every American purchase a health insurance policy.

The government maintains Congress was within its rights to pass such a law under its taxing power and constitutional authority to regulate interstate commerce. The suing states countered that the mandate was an overreach of Congress’ authority because it forces people to buy a product.

But that was Tuesday’s argument. On Wednesday, the justices — even those who seem likely to support the constitutionality of the mandate — asked both sides to presume they’d throw it out and articulate what else in the law could still stand.

The states said: nothing.

“If the individual mandate is unconstitutional, then the rest of the act cannot stand,” said Paul Clement, lawyer for the 26 states bringing the suit. “The provisions that have constitutional difficulties, or are tied at the hip to those provisions that have constitutional difficulty, are at the very heart of this act. ... You can’t possibly think that Congress would have passed a hollow shell without the heart of the act.”

The Obama administration, however, thinks there would be something to save.

“We have very important indications from the structure of this act that the whole thing is not supposed to fall,” said Deputy Solicitor General Edwin Kneedler, arguing for the government.

The Obama administration’s position is that the mandate is inextricably tied to two provisions: the guarantee of health insurance regardless of pre-existing conditions and the community rating system that lets consumers price-compare plans, they say, in order for the market to be big enough to keep costs low.

But everything else, Kneedler continued, can and should stand.

“All of the other provisions would actually increase access to affordable care and would have advantageous affects on price,” Kneedler said. “There are many, many provisions of this act already in effect without a minimum coverage provision.”

For example, the rule that children can stay on their parents’ insurance plans until age 26 — a provision that provides coverage to 2.5 million people.

An estimated 40 million people in the United States are uninsured.

For the court, however, this is also a question of how best to uphold Congress’ intent.

Although the Supreme Court has in the past considered questions of severability — that is, the separation of provisions without upsetting the whole law — it has never upheld parts of a law after rendering the core issue unconstitutional.

“This is really a case of first impression. I don’t know another case where we have been confronted with this — with this decision: Can you take out the heart of the act and leave everything else in place?” said Justice Antonin Scalia, one of the more conservative members of the court, who also wondered if it was possible to uphold Congress’ intent without preserving the heart of the law.

“Whether we strike it all down or leave some of it in place, the congressional process will never be the same,” he said. “One way or another, Congress is going to have to reconsider this, and why isn’t it better to have them reconsider it — what, what should I say? — in total?”

Other justices who seem more inclined to back the federal government in the final decision disagreed.

“There are so many things in this act that are unquestionably OK. ... Why make Congress redo those?” said Justice Ruth Bader Ginsburg, one of the more liberal members of the court. “Why should we say it’s a choice between a wrecking operation, which is what you are requesting, or a salvage job?”

“The question is always: Does Congress want half a loaf? Is half a loaf better than no loaf?” said Justice Elena Kagan, also one of the more liberal members, who seemed to support preserving what could be preserved.

But Justice Anthony Kennedy, who may emerge as the swing vote, did not seem convinced it was in the court’s purview to slice and dice.

“If one provision was stricken and the others remained to impose a risk on insurance companies that Congress had never intended ... we would have a new regime that Congress did not provide for, did not consider,” Kennedy said.

But the justices seemed less torn over the viability of one provision: the expansion of Medicaid as it is envisioned under the act.

The states argue that the federal government’s plan to expand Medicaid is coercion of the states and point to the original statute for Medicare and Medicaid that leaves it up to the secretary of Health and Human Services to decide how to deal with states that resist federal decisions.

Medicaid is a voluntary program under which states and the federal government share costs to provide medical coverage to the disabled and very poor. In the majority of states, including Nevada, the federal government picks up more than half of the tab.

The Affordable Care Act requires the states to increase their Medicaid rolls at a far more modest cost — the federal government is picking up 90 percent of the tab for the expansion. States can avoid the requirement to expand their Medicaid portfolio by opting out of Medicaid — but, they say, this is impossible: They have come to be so dependent on federal help that the federal government’s requirement to grow or drop out is tantamount to coercion.

“In the real world, to the extent the federal government continues to increase taxes, that decreases the states’ ability to tax their own citizenry, and it’s a real trade-off,” Clement said. “It’s not simply the case that you can say, ‘Well, it’s free money so we don’t even have to ask if the program’s coercive.'”

The justices seemed a little perplexed by the argument.

“Let me relieve you of that concern. ... A basic principle of administrative law, indeed of all law, is that the government must act reasonably,” Justice Stephen Breyer said. “Should a secretary cut off more money than the secretary could show was justified by being causally related to the state’s refusal to take the new money, you would march into court with your clients and say, ‘Judge, the secretary here is acting unreasonably.'"

“Why isn’t that a consequence of how willing they have been since the New Deal to take the federal government’s money?” Chief Justice John Roberts asked. “They tied the strings. They shouldn’t be surprised that the federal government is going to start pulling them.”

“You’re saying that because you represent a sizeable number of states, you can destroy this whole program even though there may be as many states that want it, that don’t feel coerced, that think this is a good thing,” Ginsburg said.

“Is there any chance that all 26 states opposing it have Republican governors and all of the states supporting it have Democratic governors?” Scalia asked, drawing laughs. “Is that possible?”

“There’s a correlation, Justice Scalia,” Clement answered, drawing more laughs.

The Supreme Court has never in its history spent so much time considering the arguments of one case, and as the hours wore on through a morning and an afternoon session Wednesday, the justices and the audience were growing punchy, trading jokes like the one above at regular intervals until Chief Justice Roberts declared: “That’s enough frivolity for a while.”

They also seemed loath to let the experience end: The final scheduled hour of argument, on the Medicaid coercion issue, ran a half hour over as justices jockeyed to get in their last questions.

Though each day that the Affordable Care Act has been on trial at the Supreme Court has been headlined by a different constitutional question, lawyers still offered final, sweeping thoughts Wednesday on the significance of this coming decision, which has the potential to rock everything from the economy to the elections.

Although this law began with a conversation about how to make health care more affordable, it ended with two opposing pleas to preserve liberty.

“We have been talking about (these provisions) in terms of their effect as measures that solve problems — problems in the economic marketplace that have resulted in millions of people not having health care because they can’t afford insurance,” Verrilli said. “There is an important connection, a profound connection between that problem and liberty.”

Verrilli recalled diabetics, people with heart disease and relatives of people with cancer.

“As a result of the health care that they will get, they will be unshackled from the disabilities that those diseases put on them and have the opportunity to enjoy the blessings of liberty,” he explained. “In a very fundamental way, this Medicaid expansion, as well as the provisions we discussed yesterday, secure the blessings of liberty.”

The lawyer for the states — which have been making their case on the platform of liberty — acknowledged but rejected the government’s attempt to reframe their chief argument.

“I certainly appreciate what the solicitor general says: When you support a policy, you think the policy spreads the blessings of liberty,” Clement said. “But I would respectfully suggest that it’s a very funny conception of liberty that forces somebody to purchase an insurance policy whether they want it or not.”

The court is expected to deliver its decision by June.

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