Was the Justice Department correct when it called key components of Obamacare unconstitutional?

Yes: Obamacare’s constitutionality ends when its tax ends

The constitutionality of Obamacare is an issue again. Six years ago, a closely divided U.S. Supreme Court upheld the statute in NFIB v. Sebelius, but the Tax Cuts and Jobs Act of 2017 had an important effect — whether or not intended — on Obamacare’s constitutionality.

Obamacare requires insurance companies to cover pre-existing illnesses and injuries. That’s an expensive proposition.

To help pay for it, Congress required everyone, especially people in good health, to buy insurance — the so-called “individual mandate.”

That requirement enables insurance companies to use their profits from covering the healthy and fit — since their premiums exceed their expenses — to underwrite treatment of the sick and injured.

Don’t purchase health coverage, Congress said, and you instead must pay money into the U.S. Treasury so that coverage can be funded.

The original legal debate was whether the Commerce Clause permitted Congress to require citizens to buy coverage.

Obamacare’s defenders argued that, since health insurance is such a large part sector of the national economy, Congress can regulate how it works.

Critics said that the individual mandate was unconstitutional because the Commerce Clause empowers Congress only to “regulate” commerce, not to “create” it.

The Supreme Court upheld Obamacare by a 5-to-4 vote. Four justices said it was a lawful regulation of commerce; four disagreed.

Chief Justice Roberts cast the deciding vote. He concluded that the individual exaction was a “tax” that could be upheld under the Constitution’s Taxing and Spending Clause.

It is irrelevant that Congress eschewed labeling the penalty as a “tax,” he wrote, because it was for the Court to decide how to classify Obamacare.

He deemed the noncompliance payment to be a “tax” because it raised revenue and sufficiently resembled a tax that it could be labeled as such. Thus, five justices found the law constitutional, even though they disagreed why.

Now the fun begins.

Effective January 2019, the 2017 Tax Cuts and Jobs Act reduces the payment into the U.S. Treasury for not purchasing health insurance to — literally — “$0.”

Does that matter? Yes, indeed. Once the Obamacare penalty disappears, so does the basis on which the Supreme Court upheld it.

In NFIB v. Sebelius, Roberts’ wrote that “the Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution,” and he found that “it can be so read.” The “exaction” imposed on people without health insurance, he wrote, “looks like a tax in many respects.”

For example, people pay the exaction amount “into the Treasury ... when they file their tax returns,” and that payment “does not apply to” people who do not pay income tax.

The payment amount “is determined by such familiar factors as taxable income, number of dependents, and joint filing status.” The payment requirement is found “in the Internal Revenue Code,” and it is “enforced by the IRS, which ... must assess and collect it in the same manner as taxes.”

If there were any doubt about the matter, he dispelled it by this line: “This process yields the essential feature of any tax: It produces at least some revenue for the Government.”

Regardless of whether Chief Justice Roberts was correct to label the Obamacare penalty a “tax” in 2012, it can’t be given that label next year.

In his words, the “essential feature of a tax” is that it raises money. Seven months from now, Obamacare won’t. Live by $1 in revenue, die by $0 in revenue.

So that brings us to this conclusion: Unless John Roberts wants history to remember him as “Humpty Dumpty” rather than as “Chief Justice of the United States,” the game is over.

No: Injustice reigns as Trump’s Justice Department attacks Obamacare

The Department of Justice’s decision to break with its duty to defend United States law and join in an ideological effort to continue dismantling the Affordable Care Act is simply wrong.

The legal argument calling the ACA unconstitutional is weak, the politics are tone-deaf and the results would take us back to the days when insurance companies decided who lives and who dies based on profit models rather than health care outcomes. As America’s pastime heats up, this move is a strikeout.

Texas v. United States is an ongoing legal challenge to the ACA’s individual mandate, which requires those without health coverage to get covered or pay a penalty.

The penalties end this year, however. The legal action has also asked for an injunction or hold on the entire ACA or at a minimum the individual mandate and the wildly popular guaranteed coverage for those with preexisting health conditions.

Now, the Justice Department has made the extraordinary decision to shirk its duty to defend existing law by refusing to back the ACA and even issuing a response arguing that since amendments to the act eliminated the penalties under the mandate, the law is now unconstitutional.

This action is extraordinary for several reasons. Foremost, it is the duty of the Department of Justice to defend existing law, not pick and choose its duty based on the ideology of the sitting administration. Justice Departments have rarely strayed from this duty throughout the years. Strike one, a foul ball off their own foot.

The Trump administration doesn’t lead with law or reality though, it leads with politics.

The politics of the DOJ’s action or perhaps inaction on this ACA challenge are meant as a political message to its dwindling base of supporters who are still opposed to Obamacare even as they support many of its parts such as federal subsidies for private coverage, the expansion of Medicaid and coverage for pre-existing conditions.

The direct attack on the elimination of pre-existing conditions protections that are a part of this legal challenge is a political head scratcher though.

One of the greatest, of admittedly many, injustices of the profit model for the health insurance has been the widespread policy of rejected coverage for, well, sick people.

This move, if fully understood, would even rile up the otherwise dedicated base and will be used by political opponents in the upcoming elections. Strike two, if you are keeping score, catches the Trump administration looking, not swinging.

The impact this would have on the health system, however, is the most devastating part of the DOJ’s move.

The plaintiffs are not just arguing against the individual mandate but are seeking to have the entire Affordable Care Act declared unconstitutional.

If this challenge, while highly unlikely, were to succeed, the admittedly popular and effective steps forward from the Affordable Care Act would be stripped away.

Millions would again be without health care through denials or be priced out of coverage. This is unacceptable. We should be moving forward on health care toward universal coverage not going backward to less coverage and care.

Strike three on the Trump administration folks — a huge swing and miss.

The Department of Justice is getting a big run of attention these days. A small sample would include the DOJ’s gut-wrenching decision to separate migrant children from their parents, which received wide and bipartisan rebukes.

On the other hand, Trump himself and his congressional allies are waging an all-out public relations war on the Department of Justice in an attempt to protect Trump from legal challenges surfacing from investigations into Russia’s meddling in the last presidential election.

If these efforts succeed, we will have gotten more injustice than justice from this Department of Justice. We get to be the umpire this time though so, Mr. President and your cronies, you’re out!