YES, Penalties are a tax

Does the Anti-Injunction Tax Act apply? See #2

NO, Penalities are not a tax

Lawsuit CAN be maintained. See Minimum Coverage Provision

YES

No suit can be maintained in a court of law – No court has jurisdiction.

*ALL*  STOP (until…Tax has been assessed, administrative remedies exhausted)²

NO

Lawsuit CAN be maintained. See Minimum Coverage Provision

Congress did not overstep its powers under the Commerce clause; it has the power to regulate markets with substantial impact on interstate commerce.

It was within Congress’ power to:

Create a regulatory scheme for the “health care market³” which…

• Compels every individual American to pay for health care services with an insurance policy;
• Require such policies include particular forms of coverage;
• Prove such a health insurance policy has been obtained annually;
• Impose a penalty for failure to comply.

Severability not at issue – see Medicaid.

There is no limiting principle in the federal government’s scheme; if Congress’ Commerce Clause power includes the ability to compel individuals to pay for health services only with an insurance policy mandated by government, there is no limit to that Commerce power.

Congress took an unprecedented step because the health care law is not regulating commerce in an existing market, it is creating a market.

Is the Minimum Coverage provision severable from the rest of the legislation? See Severability.

The minimum coverage provision is not severable.

• Congress choose not to include a severability clause⁴ in the regulatory scheme it designed because the minimum coverage provision is the centerpiece.
• Without that provision, the scheme falls apart.

AND, perhaps…

Since Congress did not choose to include a severability clause and other provisions were passed as a result of the deal-making and compromises associated with the minimum coverage provision and it is not appropriate for the Court to unravel questions regarding what among those provisions what would have passed (or not) the legislation is invalid.

The Court would overturn the legislation, noting that the legislation cannot act independently without the minimum coverage provisions, that it is Constitutionally Congress’ role to determine how to address the problems it stated it wished to solve in other ways and to sort out questions regarding what among the remainder of the thousands of pages can and should be enacted without the minimum coverage provision included. See Medicaid.

The minimum coverage provision is severable.

The legislation’s thousands of pages included many other provisions which are Constitutional and can therefore be maintained.

Although the remainder of the legislation can be maintained, Congress MAY reassess some / all of the legislative scheme as a result. See Medicaid.

The minimum coverage provision is severable, but so are the following issue(s): _________________. (Medicaid may present such an additional severability issue – see Medicaid, below)

The Court has decided in the past that it must rule on issues beyond those presented by plaintiffs or respondents. This Court has shown recognition of the importance of the issues here, an effort to be extremely thorough, and a willingness to extend beyond plaintiffs and respondents:

• Despite stipulations from the federal government and the States / NFIB that the minimum coverage provision was not a tax, the Court decided to hear arguments on the subject and even appointed attorneys to make arguments on both sides of the question.
• Despite lower court dismissal of the Medicaid issue (see below), the Supreme Court decided to hear arguments about it anyway.

Some of the legislation can be maintained, some cannot. Congress MAY reassess the remainder / all of the legislative scheme as a result. See Medicaid.

The Medicaid provisions do not over reach Congress power to spend and are not coercive.

Voluntary versus mandatory:

• Medicaid is a voluntary program from which the States may withdraw at any time; it has always been their option and remains their option whether or not to participate.
• Previous Medicaid expansions have been a mix of voluntary and mandatory, but then, as now, States could withdraw.
• If States find the implementation of new Medicaid provisions inoperable, the option to withdraw from the program remains.

Federalism / dual sovereignty:

• If States have been historically willing to cede their sovereignty to the federal government through the acceptance of federal dollars with strings, they should not be surprised that those strings are now being pulled⁶.
• The States’ dependency on federal funding is a political problem, not a legal one.
• Ultimately, voters within the States have it within their power to impact their officials as to whether or not they want the State to participate in such federal programs and regarding budgetary priorities.

Spending / taxation:

• The federal government and States have separate taxing powers; the States cannot lay claim on the federal government regarding the taxes it assesses.

Powers of the Secretary of Health and Human Services:

• Existing statutes provide relief for abusive use of executive power – the Administrative Procedures Act provides remedies for arbitrary, capricious, or unreasonable application of power by such officials.

The Medicaid provisions in the legislation are not coercive and do not constitute a case of Congress exceeding its power to spend. The Medicaid provisions, as written, would be upheld.

Congress overstepped necessary limits on its spending power; the provisions which expand and change the Medicaid program are coercive and violate the principles of federalism / dual sovereignty.

Congress’ power to spend has limits.

• To say that the Medicaid funding provided in the health care law comes from “federal funds” dismisses the reality that all tax dollars come from the same source: taxpayers within the States;
• The sheer size of the program encroaches upon / limits the States’ ability to tax citizens.

AND State budgets will necessarily be commandeered by the program:

• The amount of federal funding for the program diminishes over time;
• Federal funds do not cover all of the expenses;
• Maintenance of effort (freeze of States’ Medicaid programs as is) requirements in the bill and eligibility guidelines mean States cannot cut the Medicaid program in future, regardless of budgetary difficulties.
• States who would choose not to participate in the Medicaid expansion would face an insurmountable dual burden of still paying for other states’ Medicaid expansions AND funding their own program to provide for some program to replace existing Medicaid within the State.

Congress’ construction of the legislation proves a coercive element by tying the Minimum Coverage provision (individual mandate) directly to the Medicaid program:

• Congress provided NO alternative for health insurance coverage for particular populations besides Medicaid
• Congress apparently assumed NO State would decline Medicaid expansion participation.

The legislation’s language singles out new participants in Medicaid formerly http://thomas.loc.gov/cgi-bin/query/z?c111:H.R.3590.ENR:/ under the law (Section 2001) but, at the same ties the expansion to the existing program.

The Medicaid program elements of the Social Security Act of 1965⁷, coupled with the language in the 2010 health care legislation, grant unbridled discretion to the executive branch office of the Secretary of Health and Human Services:

• The Secretary has the ability to withdraw ALL Medicaid program funds from States which decline participation in the health care legislation’s Medicaid expansion;
• The Secretary has a history of using the power of the office to coerce State compliance and available remedies in law are inadequate in checking it.

The Constitutional provisions for dual sovereignty – federalism – requires a clear line of accountability in the relationship between government and citizen. The Medicaid program expansions constitute a blurring of the line.

Any participation in the Medicaid program by states must be voluntary. In order to comply with such a ruling, Congress would have to restructure the law so as to make the expansion optional.

Provisions in the 2010 health care legislation and/or the Social Security Act of 1965 granting unbridled power to the Secretary of Health and Human Services would be void.

See “Severability”, final section, inserting “Medicaid” in the blank AND see the additional note, below.