Does the Commerce Clause Mean Health Care is Unconstitutional?

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Anders Walker is Assistant Professor of Law at St. Louis University School of Law. He is the author of "Ghost of Jim Crow: How Southern Moderates Used Brown v. Board of Education to Stall Civil Rights" (Oxford, 2009).

On December 13, 2010, U.S. District Court Judge Henry Hudson ruled that requiring citizens to purchase health insurance is unconstitutional.  Though two other federal judges have disagreed (Thomas More Law Center v. Obama in Michigan and Liberty University v. Geithner in Virginia), Hudson’s opinion accelerates the possibility that the issue will go to the Supreme Court, possibly jeopardizing the administration’s health care plan.  Is he right?  According to Hudson, the requirement that citizens purchase health care violates the Constitution’s commerce clause, a provision that limits congressional power to regulating commerce “among the several states.”  Proponents of the plan argue, reasonably, that if all citizens are required to purchase health insurance, even healthy ones, then the overall price of that insurance will go down—nationally.  This is probably true; as is the notion that health insurance is an interstate business (think Blue Cross Blue Shield).  Further, Congress appears to have Supreme Court precedent on its side, including Gibbons v. Ogden, one of the earliest commerce clause cases, in which the Court held that the commerce power “acknowledges no limitations,” and is restrained only by the “wisdom and discretion of Congress”  (Gibbons v. Ogden [1824]).  Later cases support this expansive view, including a case sanctioning federal regulations of wheat grown by farmers for their own use (Wickard v. Filburn [1942]), together with federal regulations of marijuana grown by owners for their own personal use (Gonzales v. Raich [2005]).

Is refusing to buy health insurance a commercial activity, like growing wheat and marijuana for personal use?  Judge Hudson thinks not, though in certain ways the argument is easier to make for health insurance than personal pot.  For example, even if refusing to buy health insurance was not a commercial activity prior to the Obama plan, Congress’s decision to enact that plan appears to have changed the landscape of health care, effectively creating a quasi-public regulatory health system supported entirely by private markets, markets that not only span state lines but support one of the nation’s largest economic sectors, the health care industry.  For this private-public hybrid to work, however, it is reasonable to assume that there must be a 100 percent buy-in by the public, mandated by law, or else interstate commerce—the national health care industry—will suffer.  Hudson’s failure to see insurance rejection as commercial behavior belies a larger inability to understand the sheer scope of the Obama plan, a scheme that is both more ambitious than earlier health insurance efforts (Medicare & Medicaid), and more privatized.

Why Hudson’s myopia?  Though some speculate that his constitutional reasoning belies Republican prejudice, it is not clear that Republicans will suffer from the government’s new program.  After all, the private health care industry stands to enjoy an unprecedented infusion of cash as poor people across the country are forced to divert their meager funds to health insurance, not food or gas.  This is why, for true believers in universal health care, the Obama plan is a disappointment, a regressive tax scheme that enriches business while forcing the poor to pay for coverage that, in Europe, would be free. 

Perhaps this is why Hudson rules the way he does.  Veiled in the garb of universal coverage, the Obama plan is actually coercive; a scheme aimed at forcing people to act against their will.  Then again, doesn’t the government force us to act against our will all the time?  Isn’t that the reality of the federal income tax?  Hudson argues no, positing that the Obama plan imposes an unconstitutional penalty, not a tax, on citizens. (1)  This distinction is important.  Pursuant to the Constitution’s general welfare clause, Congress has almost unlimited power to tax, making a tax on people without health coverage perfectly constitutional.  However, Hudson argues that the requirement is in fact a penalty, and therefore must be linked to “an enumerated power other than the General Welfare Clause.” 2  Of course, this brings us back to the link between health insurance and the commerce clause, which—as we have already seen—is not hard to make.

(1)Virginia v. Sebelius, Case 3:10-cv-00188-HEH.

(2)Virginia v. Sebelius, Case 3:10-cv-00188-HEH.

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