One interesting thread in the Supreme Court argument on the individual mandate was the point that Congress has the power to tax to pay for a public health care system. And it was conservatives who took this position. Other Wolters Kluwer bloggers have covered the arguments on the individual mandate. Rather than revisit them, I’ll get right to the point.
Early in the argument, Chief Justice Roberts compared the unanticipated need for health care to the need for emergency services. You don’t know when you’re going to need police protection or firefighters. But when you need them, the government will provide them to the extent it can. Justice Roberts didn’t mention that we pay for police and fire protection with taxes. But he clearly understood them to be government functions.
Later, as the Solicitor General was focused on the prerogative of Congress to choose among options in regulating commerce, Justice Kennedy asked whether, assuming that Congress could use the taxing power to create a national health care system, that power should be considered in the Court’s analysis of the legislation. “In one sense, it can be argued that this is what the government is doing; it ought to be honest about the power that it’s using and use the correct power,” he said.
Questioning counsel for the states, Justice Ginsburg compared the individual mandate to Social Security. There was a need for old age and survivor’s insurance, it was paid for with taxes, the young and healthy were required to contribute to make it work. Everyone agrees that’s constitutional. Were the states contending that Congress could take over the payment system but could not involve private insurers?
Counsel responded that the most straightforward way would be a tax to subsidize the insurers’ costs related to guaranteed issue and community rating. Once the amount needed was established, spread that amount evenly among taxpayers. Could people who bought insurance get a credit, Justice Sotomayor asked? Counsel thought there would be a way to “incentivize” the purchase of insurance through the tax system. But a tax on not having health insurance would be invalid as a direct tax.
During the argument on behalf of the private business parties, the discussion returned to use of the individual mandate to counter the problem of uncompensated care. Justice Alito contended that the government shifted the costs by enacting the Emergency Medical Treatment and Active Labor Act (EMTALA), requiring hospitals to serve people in emergency rooms regardless of their ability to pay. But, he stated, “instead of paying for that through a tax which would be born by everybody,” it has surreptitiously shifted the cost to those who pay for services with their health insurance.
Counsel representing business agreed. The individual mandate was not needed to resolve a moral dilemma resulting from unfunded emergency care. Having made an appropriate value judgment in enacting EMTALA, Congress should impose taxes to spread the burden evenly. What was wrong was that the law “conscripted” the young, healthy and uninsured to pay for it.
Justice Sotomayor asked specifically whether “Congress can tax everybody and set up a public health care system”. “Yes,” counsel replied.
“That would be okay?”
Justice Sotomayor then asked whether he believed that Congress could not give a tax credit for the purchase of private insurance because those people would not access the public system. Counsel did not believe that a tax that incentivized the purchase of insurance would be a problem, though he did agree that a direct tax would be unconstitutional.
In a way, the use of taxes to assure access to health care was the proverbial elephant in the room.