The Volokh Conspiracy

Whether or not you believe the PPACA has been or will be good for the American people, it has certainly been good for the lobbyists and legislative staffers who wrote it, as Tim Carney explains. Glenn Greenwald comments further:

This is precisely the behavior which, quite rationally, makes the citizenry so jaded about Washington. It’s what ensures that the interests of the same permanent power factions are served regardless of election outcomes.

Adds Carney, this is “a good reminder of what Obamanomics and Bushonomics have in common.”

In NFIB v. Sebelius the Supreme Court upheld the individual mandate penalty as a constitutional exercise of the federal taxing power. Although little of the briefing (and even less of the oral argument) considered the question, the Court concluded the penalty did not constitute a “direct tax.” This conclusion was necessary to sustain the penalty as a tax because direct taxes must be apportioned among the states by population. But if the penalty is not a direct tax, that does not mean it is free from constitutional defect. As David Rivkin and Lee Casey write in today’s WSJ, the Uniformity Clause of Article I, Section 8 could provide the basis for another attack on the penalty. They write:

If the mandate is an indirect tax, as the Supreme Court held, then the Constitution’s “Uniformity Clause” (Article I, Section 8, Clause 1) requires the tax to “be uniform throughout the United States.” The Framers adopted this provision so that a group of dominant states could not shift the federal tax burden to the others. It was yet another constitutional device that was simultaneously designed to protect federalism and safeguard individual liberty.

The Supreme Court has rarely considered the Uniformity Clause’s reach, but it cannot be ignored.. . . And although the court has upheld as “uniform” taxes that affect states differently in practice, precedent makes clear that a permissible tax must “operate with the same force and effect in every place where the subject of it is found,” as held in the Head Money Cases (1884). The ObamaCare tax arguably does not meet this standard.

ObamaCare provides that low-income taxpayers, who are nevertheless above the federal poverty line, can discharge their mandate-tax obligation by enrolling in the new, expanded Medicaid program, which serves as the functional equivalent of a tax credit. But that program will not now exist in every state because, as a matter of federal law, states can opt out. The actual tax burden will not be geographically uniform as the court’s precedents require.

Thus, having transformed the individual mandate into a tax, the court may face renewed challenges to ObamaCare on uniformity grounds. The justices will then confront a tough choice. Having earlier reinterpreted the mandate as a tax, they would be hard-pressed to approve the geographic disparity created when states opt out of the Medicaid expansion. But that possibility is inherent in a scheme that imposes a nominally uniform tax liability accompanied by the practical equivalent of a fully off-setting tax credit available only to those living in certain states. To uphold such a taxing scheme would eliminate any meaningful uniformity requirement—a result that the Constitution does not permit.

I am not familiar enough with the relevant precedents to evaluate the strength of this claim, but it is certainly true that people with equivalent incomes will be subject to different penalties in different states. So if the Uniformity Clause has any real bite, the penalty would appear vulnerable. It’s also worth recalling that PPACA defenders have been a bit too quick to dismiss Rivkin and Casey in the past.

UPDATE: Insofar as a lack of uniformity is a real constitutional concern under current doctrine, the PPACA’s problems could be larger than Rivkin and Casey suggest. This is because that even without regard to state decisions to participate in Medicaid, the penalty is not uniform. This is because the affordability exemption is based upon the cost of obtaining qualifying health insurance, and this cost will vary across states. A potential counter-argument might be that this variation is due, at least in part, to state policy choices (e.g. mandated minimum coverage, etc.), nonetheless it would remain the case that two individuals with the same incomes living in different states would not necessarily both be subject to the same penalty. Note further that this would be true even if one does not assume (as Michael Cannon and I have argued) that the tax credits and subsidies for the purchase of health insurance are not available in states without state-run exchanges.

The election may be over, but the work of “fact-checkers” continues. Last week, Politifact-Georgia waded into the debate over whether states should create health insurance exchanges with a fact check of my occasional co-author Michael Cannon of the Cato Institute. Specifically, Politifact evaluated the claim, made in this article, that:

operating an Obamacare exchange would be illegal in 14 states. Alabama, Arizona, Georgia, Idaho, Indiana, Kansas, Louisiana, Missouri, Montana, Ohio, Oklahoma, Tennessee, Utah, and Virginia have enacted either statutes or constitutional amendments (or both) forbidding state employees to participate in an essential exchange function: implementing Obamacare’s individual and employer mandates.

Politifact rated this claim as “false” because “federal law supersedes state law.” As the headline reiterated: “Experts say federal law trumps state law on ‘Obamacare exchange’ claim.” It’s certainly true that “federal law supersedes state law,” but it’s also irrelevant to the claim that state law precludes employees in these states from creating exchanges. Under the Supremacy Clause, validly enacted federal laws trump inconsistent state laws, but federal law cannot compel state officials to implement federal law. As the Supreme Court has made clear in numerous cases, and reiterated in NFIB v. Sebelius, the federal government may not commandeer state officials to implement a federal program. Therefore, federal law does not – indeed, cannot – compel Georgia (or any other state) to create a health insurance exchange and does not preempt a state law that prohibits state officials from doing so. Moreover, when asked, the one legal expert Politifact consulted told me she did not claim otherwise. More importantly, Cannon never claimed the federal government could not create an exchange in Georgia under federal law. Nonetheless, Politifact rated Cannon’s claim as “false.”

When challenged on the accuracy of the “fact check,” the author of the item, Eric Stirgus, wrote back:

It would have been helpful to us if Mr. Cannon had explained himself and provided any research he thought would have been useful during the reporting process. But he refused, citing a prior boycott of PolitiFact.

Mr. Cannon might have been trying to argue that state workers in places like Georgia are not compelled to participate in creating health care exchanges. But that argument is severely hampered by his beginning statement that “operating an Obamacare exchange would be illegal in 14 states.” It’s clearly not illegal. Had he omitted that phrase, he might have gotten a better rating on the Truth-O-Meter.

This response is quite disingenuous. Re-read the quote under examination above. Cannon did not “try” to argue “state workers in places like Georgia are not compelled to participate in creating health care exchanges.” He made that exact point in the second sentence of the quote under examination, when he noted state law “forbid[s] state employees” from implementing the federal law — the sentence conveniently omitted from Mr. Stirgus’s e-mail. In case there was any doubt, the whole point of the article from which the quote was taken was that states should not create health insurance exchanges and, in this very same article, Cannon noted that if states don’t create exchanges they will “default[] to a federal exchange.” So not only did Cannon not clam the state laws precluded the federal government from creating or operating an exchange, he actually noted that state failure to create an exchange could result in a federal exchange within the state. And as if that were not enough, in the original fact-check Stirgus cited from an e-mail Cannon sent to one of Stirgus’s colleagues at the Atlanta Journal-Constitution walking through his explanation of why Georgia law precluded Georgia’s creation of a health insurance exchange under the PPACA. Stirgus conveniently omitted mention of this too. It’s almost as if Stirgus was trying punish Cannon for refusing to cooperate in his fact check, but no professional journalist would do something like that when purporting to conduct a neutral “fact check.”

If Politifact had wanted to evaluate the substance Cannon’s actual claim, it would have considered the text of the Georgia law and analyzed whether it would, in fact, preclude state employees from implementing a health insurance exchange. It didn’t need a further response from Cannon to do this, as the basis of his claim was abundantly clear. I think Cannon makes a compelling case as the Georgia law prohibits even “indirect” implementation of health care mandates and state-run exchanges provide the trigger for enforcement of the employer mandate, but I am not an expert on Georgia law. At the very least it would seem that this claim is a debatable legal proposition. Yet Politifact never considered this issue. Down in Georgia, this is apparently what passes for a “fact check.”

In July, I suggested that Chief Justice Roberts’ decision to uphold the individual mandate as a tax in NFIB v. Sebelius was largely consistent with the overall judicial approach he’s demonstrated since joining the Court. I have expanded this argument into an essay that will be included as a chapter in the forthcoming book The Health Care Case: The Supreme Court’s Decision and Its Implications, edited by Nathaniel Persily, Gillian E. Metzger, and Trevor W. Morrison and to be published by Oxford University Press early next year. (This is the same book Ilya noted here.) A draft of the chapter is available on SSRN. Here is the abstract:

Chief Justice John Roberts’s decision in NFIB v. Sebelius holding the individual mandate exceeded the scope of Congress’s power to regulate commerce but could nonetheless survive as a constitutional exercise of the taxing power caught most commentators by surprise. Post-decision reports that Roberts changed his vote at some point during deliberations fueled speculation his opinion was politically motivated. Ignored in most post-decision commentary is the extent to which Chief Justice Roberts’s NFIB opinion is consistent with his own stated judicial philosophy and his record on the bench. The key elements of his opinion, including his Commerce Clause analysis and adoption of a “saving construction” to preserve the statute’s constitutionality are of a piece with his prior opinions as a Justice and Circuit Court judge and his accounts of the proper judicial role. This decision provides further confirmation that the Chief Justice is, above all else, a conservative judicial minimalist in his approach to deciding cases.

At the Law and Liberty Blog, my George Mason colleague Michael Greve has posted an insightful commentary on my forthcoming article analyzing the proper meaning of “proper.” Michael agrees with my conclusion that the individual health insurance mandate was improper, but takes issue with some of my reasoning:

My colleague Ilya Somin has penned a good piece on “The Individual Mandate and the Proper Meaning of ‘Proper’,” arguing that Chief Justice John Roberts’ opinion in NFIB v. Sebelius has “moved our jurisprudence closer to the proper meaning of proper.” Moreover, the Chief was right to conclude that the notorious individual mandate flunks a proper “proper” test. I agree with that assessment and much else in Ilya’s instructive article, though perhaps for somewhat different reasons.

The basic proposition is that “proper” in the Necessary and Proper Clause must have some independent meaning (independent, that is, from “necessary”). A “minimalistic” reading of “proper,” Ilya writes, holds that Congress may not pass laws that imply a limitless understanding of congressional powers, or which would render large parts of the Constitution redundant. (In other words, a constitutional interpretation that can’t handle broccoli must be wrong.) A broader reading, advocated by a scholars’ amicus brief in NFIB v. Sebelius... and suggested twice in Chief Justice Roberts’ opinion, picks up John Marshall’s M’Culloch suggestion that the Necessary and Proper Clause encompasses “incidental” powers but not “great substantive and independent” ones. A power to impose mandates (the argument concludes) flunks that test.

I’m not entirely happy with either formulation. The “minimalistic” reading simply restates the principle of limited and enumerated powers, which would control (and since at least Gibbons v. Ogden has controlled) even without “proper.” And the broader reading rests on a distinction that to my mind was suspect the day it was announced. (Nobody ever incorporates something for its own sake, the Chief wrote in M’Culloch; the power didn’t have to be enumerated because it is incidental. But nobody ever taxes for the heck of it, either; yet that power is enumerated.)

I’m not persuaded by Michael’s critique of either the minimalistic or the broader interpretation of “proper.” If the Necessary and Proper Clause were a mere “Necessary Clause” with the word “proper” omitted, Congress might well have virtually unlimited power, at least if necessary is defined broadly as anything that is in some way “useful” or “convenient” for executing some other enumerated power (which is the definition adopted by the Supreme Court in the famous 1819 case of McCulloch v. Maryland). As I explain in my article, virtually any mandate or regulation of any kind could be justified on that basis. Even the famous broccoli mandate might be a convenient way of regulating the interstate market in food, and thereby permissible under a combination of the “Necessary Clause” and Congress’ power to regulate interstate commerce. This is not an inevitable interpretation of “necessary.” But it’s plausible enough that the word “proper” was deliberately inserted into the Constitution in part to prevent courts from adopting this sort of view.

Michael’s critique of the broader view of “proper” advocated by Chief Justice Roberts and the scholars’ amicus brief also has flaws. The distinction between an incidental power and a “great substantive and independent one” is not based on the idea that the latter exists “for its own sake,” while the former is purely instrumental. All powers are essentially instrumental. Rather, the distinction is between powers that are relatively minor compared to the greater power they help to execute and those that are major grants of power in their own right. To put it more crudely, the argument is that the Necessary and Proper Clause can be used to give a dog a tail to wag, but not to create a dog where the other enumerated powers only create a tail. The power to tax is a massive power in its own right, and therefore could not have been created by the Necessary and Proper Clause if it were not established on its own. Taxation is a dog, not a tail.

As I explain in my article, the minimalistic interpretation of “proper” is potentially compatible with the incidental power interpretation. The former holds that “proper” at the very least excludes assertions of power that give Congress unconstrained authority or render other congressional powers redundant. But it doesn’t necessarily require us to conclude that those are the only assertions of federal power that might be improper.

By the way, the scholars’ amicus brief Michael refers to was written by co-blogger David Kopel, on behalf of three leading Necessary and Proper Clause scholars. The brief lays out their theory much more fully than I can do here, or even in my article.

Michael’s post also advances his own interpretation of “proper”:

Necessary” is a means-ends test: legislation must be necessary (convenient, useful) to a constitutionally provided-for end. “Proper,” in contrast, can’t be a means-ends test, at least not exclusively: if it were, it would be swallowed by ”necessary” and judicial deference canons. It’s best read (to my mind) as shorthand for the proposition (Marshall’s proposition) that legislation must be consistent with the letter and the spirit of the Constitution—not its ghost but its structural principles, including principles that (unlike the principle of limited and enumerated powers) aren’t immediately obvious.

The principle here at issue is the distinction between a prohibition and an affirmative command. That distinction is better than the (admittedly, related) distinction between regulating “activity” (okay) and “inactivity” (not okay) because the Constitution itself makes it: explicit powers to command (like the Militia Clauses and, by conventional—though not unassailable—understanding the Supremacy Clause, as to state judges) are exceedingly few and, moreover, institutionally cabined. Whence we (or at least I) infer that unless the power to command is provided for (textually or by unmistakable inference, as with military conscription) it’s excluded.

This view isn’t necessarily incompatible with my minimalistic interpretation, for the same reason that the incidental power theory isn’t. But I have my doubts about it. It’s true that a general power to issue any commands of any kind would be “improper.” On the other hand, I’m not sure that the power to issue commands is always precluded unless explicitly stated or unmistakably implied. Much depends on the wording of the particular Clause in question. In the case of the power to regulate interstate commerce, the power to issue commands is, I think, barred, because “commerce” implies that Congress many only use it to regulate some kind of preexisting interstate economic activity. But not all grants of power work that way. For example, Congress’ power to raise and support armies is a power to create an army where none existed previously, and therefore implies a power to issue commands. The same goes for Congress’ power to coin money, for example, which implies a power to create money where none previously existed. But it may be that all such cases fall within Michael’s category of situations where a power to issue commands is created by “unmistakable inference.” If so, the difference between our two positions may be relatively small.

Today’s WSJ reports:

Several restaurants, hotels and retailers have started or are preparing to limit schedules of hourly workers to below 30 hours a week. That is the threshold at which large employers in 2014 would have to offer workers a minimum level of insurance or pay a penalty starting at $2,000 for each worker.

The shift is one of the first significant steps by employers to avoid requirements under the health-care law . . .

benefits consultants said most retail and hotel clients have explored shifting toward part-time workers.

Those industries are less likely to offer health coverage now, and if they do, the plans typically are too skimpy to meet the minimum-coverage requirements.

“They’ve all considered it,” Matthew Stevenson, a workforce-strategy principal at Mercer. In a July survey, 32% of retail and hospitality company respondents told the consulting firm that they were likely to reduce the number of employees working 30 hours a week or more.

Back in December, I criticized the false dichotomy set up by those who claim that the only available alternative to the Obama health care plan is some form of socialized medicine.

In this recent essay, University of Chicago economist John Cochrane gives an excellent summary of free market alternatives to the ACA that can cut health care costs and deal with the problem of preexisting conditions, which is the main justification for the ACA’s individual mandate.

Here’s one of his key points:

We all agree what we’d like to see: Health care needs to become efficient, innovative, and provide high quality care at lowest possible cost....

How will this happen? Well, we have before us many good examples. Walmart and Home Depot revolutionized retail. Airlines are dramatically cheaper than in the 1970s. Consumer electronics, telecommunications, computers, and even cars are much better and cheaper, for what you get, than ten or twenty years ago.

These revolutions are not just about technology. In most of these cases, we see process innovation, reorganizing activities to deliver complex services at lower cost and with better and more uniform quality. This process efficiency is most glaringly absent in health care...

How will this change come about? My examples share a common thread: Intense competition by new entrants, who put old companies out of business or force unwelcome and disruptive changes. Microsoft displaced IBM, and Google is displacing Microsoft. Walmart displaced Sears, and Amazon.com may displace Wal‐Mart. Typewriter companies didn’t invent the world processor, nor did they adapt. The post office didn’t invent FedEx or email. Kodak is out of business. Toyota gave us cheaper and better cars, not Ford/GM/Chrysler competition. When the older businesses survive, it is only the pressure from
new entrants that forces them to adapt....

A small example: In Illinois as in 35 other states, every new hospital, or even major purchase, requires a “certificate of need.” This certificate is issued by our “hospital equalization board,” appointed by the governor (insert joke here) and regularly in the newspapers for various scandals. The board has an explicit mandate to defend the profitability of existing hospitals. It holds hearings at which they can complain that a new entrant would hurt their bottom line. Specialized practices that deliver single kinds of service or targeted groups of customers cheaply face additional hurdles, as they undermine the cross‐subsidization provided by “full service” hospitals....

Cochrane discusses various ways in which deregulation and competition can cut costs and increase access to health care, including for those with preexisting conditions. He also points out that the ACA and various other highly interventionist policies are not needed to provide health care for the poor:

If cash markets were functional [as would be the case under deregulation], health insurance could become what it should be: a way of protecting lifetime wealth from catastrophic shocks, like life insurance. Such insurance would, of course, be a lot cheaper. It would not have to be a negotiator and payment plan for routine expenses. “Access” should mean a checkbook and a willing supplier, not a Federally Regulated payment plan. Insurance means your large‐scale standard of living isn’t enormously impacted by rare events....

“What about the homeless guy with a heart attack?”

Let’s not confuse the issue with charity. The goal here is to fix health insurance for the vast majority of Americans....

Yes, we will also need charity care for those who fall through the cracks, the victims of awful disasters, the very poor, and the mentally ill. This will be provided by government and by private charity. It has to be good enough to fulfill the responsibilities of a compassionate society, and just bad enough that few will choose it if they are capable of making choices. I wish it could be better, but that’s the best that is possible. For people who are simply poor, but competent, vouchers to buy health insurance or to refill health savings accounts make plenty of sense.

But supplying decent charity care does not require a vast “middle‐class” entitlement, and regulation of health insurance and health care for everyone in the country, any more than providing decent homeless shelters (which we are pretty scandalously bad at) or housing subsidies for the poor (section 8) requires that we apply ACA style payment and regulation to your and my house, Holiday Inn or the Four Seasons.

To take care of homeless people with heart attacks, where does it follow that your and my health insurance must cover first‐dollar payment for wellness visits and acupuncture?

UPDATE: Co-blogger Jonathan Adler made some related points here.

My forthcoming book chapter, “The Individual Mandate and the Proper Meaning of ‘Proper,’” is now available on SSRN. It is forthcoming in The Health Care Cases, edited by Gillian Metzger, Trevor Morrison, and Nathaniel Persily, eds. (Oxford University Press). The book is a collection of essays on NFIB v. Sebelius, the case where the Court addressed the constitutionality of the Obama health care bill. Among the many other contributors are Jack Balkin, Erwin Chemerinsky, Richard Epstein, Charles Fried, Jamal Greene, Linda Greenhouse, Andrew Koppelman, Neil Siegel, Larry Solum, and VC co-bloggers Jonathan Adler and Randy Barnett.

Here is the abstract for my contribution:

The Necessary and Proper Clause of the Constitution has often been at the center of debates over the limits of federal power. But in the first 220 years of its history, the Supreme Court never gave us anything approaching a comprehensive analysis of what it means for a law to be “proper.” The Court’s recent decision on the constitutionality of the Affordable Care Act individual health insurance mandate in NFIB v. Sebelius helps fill this gap. It moves constitutional jurisprudence closer to the proper meaning of proper.

In this article, I explain why Chief Justice John Roberts’ key swing-vote opinion was right to conclude that the individual health insurance mandate requiring most Americans to purchase government-approved health insurance is outside the scope of Congress’ power under the Necessary and Proper Clause becasue it is not “proper.”

Part I shows that the Necessary and Proper Clause compels laws authorized by the Clause to meet two separate requirements: necessity and propriety. Both the original meaning of the Clause and Supreme Court precedent support this interpretation. The Necessary and Proper Clause cannot be reduced to a mere “Necessary Clause” that renders the word “proper” meaningless.

Part II argues that the individual health insurance mandate is improper because upholding it under the Clause would have given Congress virtually unlimited power to impose other mandates, and also render large parts of the rest of Article I redundant. This is consistent with a relatively minimalistic reading of the word “proper.” I consider and reject various attempts to prove that the health insurance mandate is a special case different from other mandates. I also briefly discuss a broader interpretation of the Clause: that the power to impose mandates on the general population is not a power “incidental” to Congress’ other enumerated powers, but rather a major independent power of its own. Both the minimalistic and broad interpretations of “proper” lead to the same conclusion in the mandate case.

Finally, Part III briefly discusses the possible future implications of Roberts’ interpretation of propriety. Here, much depends on the future composition of the Supreme Court and other contingent factors. There is also an ongoing debate over whether the Chief Justice’s Necessary and Proper reasoning is mere dictum that does not bind lower courts. But it is possible that the ruling will have a noteworthy impact in curtailing future federal mandates. Future courts might also build on the NFIB’s interpretation of “proper” as a tool for incrementally strengthening limits on federal power.

Near the end of Thursday night’s vice-presidential debate, Vice President Joe Biden said the following:

With regard to the assault on the Catholic Church, let me make it absolutely clear. No religious institution, Catholic or otherwise, including Catholic Social Services, Georgetown Hospital, Mercy — any hospital — none has to either refer contraception. None has to pay for contraception. None has to be a vehicle to get contraception in any insurance policy they provide. That is a fact. That is a fact.

VP Biden may well believe this, but it is not true. In February HHS finalized the regulations mandating the inclusion of contraception in employer-provided health plans and exempting houses of worship, but not religious universities, hospitals and charities. At the time the Administration announced its intent to accommodate other religious employers, but no such accommodation has been forthcoming. This is because creating such an accommodation is difficult. Some religious institutions self-insure, so shifting the obligation to insurers would not do the trick (and it’s not clear HHS has the authority to impose such a requirement anyway). In March, HHS issued an Advance Notice of Proposed Rulemaking and postpone enforcement of the existing rules against religious employers, but did not detail any regulatory change that would effectively relieve objecting religious institutions from paying for contraception. This is one reason why there are over two-dozen lawsuits against the contraception mandate pending in federal court.

UPDATE: The U.S. Conference of Catholic Bishops also disputed Biden’s statement. As noted in the comments, the best defense of Biden’s statement is that religious institutions are not today obligated to pay for contraception, but that’s only because the regulation is not yet being enforced. Biden articulated the stated Administration policy, but that policy is not the law — and that policy has not even been embodied in a proposed regulation, let alone a final rule. Contrary to Biden’s claim, the regulation on the books — promulgated by his administration — does apply the contraception mandate to “Catholic social services, Georgetown hospital, Mercy hospital,” and other objecting religious institutions.

I should also add, as I’ve noted before, that I think the First Amendment objections to the contraception mandate are far less serious than those based on the Religious Freedom Restoration Act (RFRA). If the mandate falls in court, it will be due to RFRA.

FWIW, back in March I noted one way to increase access to contraception without imposing a mandate on religious employers would be to make more forms of contraception available without a prescription. Some religious groups might not like this, but such a change would eliminate any potential burden on religious practice.

MORE: Georgetown’s Berkeley Center for Religion, Peace and World Affairs has a useful site with links to relevant documents and essays.

In addition to Willow, there were two major dogs that didn’t bark during tonight’s presidential debate. First, even though the debate was supposed to focus on domestic policy, neither the moderator nor the candidates ever focused on some of the most important domestic issues on which the president can have a big impact: issues such as judicial nominations (not discussed at all) and regulatory agencies (only mentioned in passing). Instead, they spent a lot more time talking about short term economic performance, which presidents have only very limited leverage over. That is likely because voters who know little about politics and policy tend to focus on the wrong issues because they often don’t understand what a president can actually control and what he (mostly) can’t.

Second, although Romney predictably spent a lot of time attacking Obamacare, he said absolutely nothing about the individual health insurance mandate, which remains hugely unpopular – far more so than any other part of the law. Even when Obama waxed eloquent about the evils of insurance companies, Romney didn’t play the obvious gambit of pointing out that the President is the one who passed a law that forces millions of people to buy insurance company products that they don’t want, after saying in 2008 that “[f]orcing people to buy health insurance [in order to provide them with health care] is like forcing the homeless to buy a house to eliminate homelessness.”

Why did Romney let this opportunity slip by? The answer is obvious. If he had attacked the individual mandate, Obama could have countered by noting that Romney’s own Massachusetts health care plan also includes an individual mandate, and Obamacare was modeled on Romneycare. Even as it stood, Obama was able to point out (correctly) that his health care plan was modeled on Romney’s and designed by some of the same advisers.

Overall, Romney did reasonably well in tonight’s debate. If the CNN commentators I’m watching are to believed, he even outperformed Obama. But by nominating the father of Romneycare, the GOP cost itself an opportunity to attack the most politically vulnerable part of Obamacare. That’s what happens when, as economist Bryan Caplan once put it, the Republicans nominate the John the Baptist of Obamacare to run against the program’s Jesus Christ.

UPDATE: I have made a few minor stylistic revisions to this post.

UPDATE #2: A CNN poll of people who watched the debate shows that 67% thought Romney won, compared to only 25% who picked Obama. My own impression is that the two candidates were pretty even. But I’m obviously not the the average swing voter whom they were trying to appeal to. That said, surveys have repeatedly shown that swing voters (like most of the rest of the public) hate the individual mandate. Other things equal, the GOP would be better off if they had a candidate who was able to attack it.

For those who may be interested, I am going to be speaking at the University of Minnesota Law School and the University of Tulsa this week.

On Wednesday at 12:15 PM, I will be debating University of Minnesota Professor Fred Morrison about the Supreme Court’s health care decision at the University of Minnesota Law School, at an event sponsored by the Minnesota Federalist Society.I summarized my thoughts on the decision here.

I did not notice until after the fact that this event coincides with Yom Kippur. I apologize if that ends up driving away a significant part of the potential audience. But there was no other date that fit all the participants’ schedules.

On Friday, I will be participating in a conference at the University of Tulsa College of Law devoted to the work of Yale Law School Professor Heather Gerken, one of the nation’s top federalism and election law scholars. The conference is open to the public and the schedule is available here. I am told that lawyers can get CLE credit for attending. Among the other participants are well-known constitutional law and elections scholars such as Sanford Levinson (Texas), Ernie Young (Duke), my GMU colleague David Schleicher, and many others.

I previously commented on Gerken’s important work on federalism here.

Oklahoma Attorney General E. Scott Pruitt today filed an amended complaint in the state’s lawsuit against the Patient Protection and Affordable Care Act that, among other things, challenges the legality of an IRS rule that would authorize tax credits for the purchase of health insurance in federally run exchanges, and thereby expose Oklahoma employers to penalties should they fail to comply with the law’s employer mandate. Here’s AG Pruitt’s press release and an early news report. For background on the issues in this suit, see here.

In related news, Hobby Lobby filed suit against the so-called contraception mandate last week. With this filing, there are now over two-dozen suits pending against the requirement that employers include coverage for government-approved methods of contraception in health insurance plans offered to their employees. Whatever the outcome of the direct challenges to this policy, should Oklahoma’s claim that the IRS rule is illegal prevail, the contraception mandate would be unenforceable against employers in states without state-run exchanges. For this reason, I would not be surprised if some of the plaintiffs challenging the contraception mandate opt to challenge the IRS rule as well.

UPDATE: Oklahoma’s amended complaint is here.

The Congressional Budget Office has just released new estimates of the number of people who will be subject to the individual mandate penalty tax for failing to obtain qualifying health insurance in 2016. According to CBO’s new analysis, the penalty tax will be paid by six million people. The penalty tax will generate an estimated $7 billion for the U.S. treasury and 80 percent of those paying the penalty tax will earn less than 500 percent of the poverty level. (For reference, the poverty line for a family of four is $23,050 in 2012, according to HHS.) The estimated number of people who will have to pay the penalty tax is approximately 50 percent higher than the CBO’s 2010 estimate, but the CBO only attributes a small portion of the increase to potential state decisions to opt out of the Medicaid expansion as allowed by NFIB v. Sebelius. According to the CBO, 30 million Americans will remain uninsured in 2016.

UPDATE: The AP reports: “Nearly 6 million Americans — significantly more than first estimated— will face a tax penalty under President Barack Obama’s health overhaul for not getting insurance, congressional analysts said Wednesday. Most would be in the middle class.”

The PPACA provides for tax credits and subsidies to help eligible taxpayers purchase health insurance in state-run health insurance exchanges. Although the text of the statute only provides for the issuance of credits in exchanges “established by a state,” the IRS has issued a regulation providing for the issuance of tax credits and subsidies in federally run exchanges as well. (More here and here.) This is significant because a substantial number of states are refusing to create their own exchanges, and the question could well end up in court.

As a normal matter, individuals lack standing to challenge the legality of favorable tax treatment given to someone else. In this case, however, employers in states with federal exchanges could sue to challenge the IRS rule because the issuance of tax credits will trigger penalties on employers under the so-called employer mandate. What about individuals? It turns out, some individuals in states that do not create their own exchanges may have standing to sue as well, as Michael Cannon and I explain in the revised version of our forthcoming paper in Health Matrix.

The reason some individuals could have standing to challenge the IRS rule is that the issuance of unauthorized tax credits in federal exchanges would expose them to tax penalties under the individual mandate. This is because liability for the individual mandate tax penalty is based upon the cost an individual has to pay for qualifying health insurance. If an individual’s “required contribution” exceeds 8 percent of household income, they are exempt from the penalty. By providing a tax credit and subsidies, the IRS rule reduces the cost of purchasing a qualifying health insurance plan, thereby exposing some individuals who do not wish to purchase health insurance to the tax penalty. Therefore, an individual who lives in a state that will not establish an Exchange by 2014 and that would otherwise qualify for the affordability exemption in the absence of tax credits would have standing to challenge the rule, provided that they earn between 100 and 400 percent of the federal poverty level, do not receive health insurance from their employer, and would be exposed to the tax penalty due to the availability of tax credits under the IRS rule. Given that several million Americans satisfy these criteria, I would not be surprised to see some file suit.

NFIB v. Sebelius may be over, but the litigation against the PPACA continues. The latest lawsuit comes from Maine, which is challenging the constitutionality of the “maintenance of effort” provisions which require that states maintain whatever Medicaid eligibility standards they had in effect as of the PPACA’s enactment in March 2010. Failure to maintain these standards results in the loss of all current Medicaid funding. Maine’s brief is here.

Maine’s argument is that the MOE provision is part of the Medicaid expansion, and was therefore invalidated by the Court’s holding in NFIB. Among other things, Maine notes that the MOE rules were originally adopted in return for receipt of stimulus funding in 2008. That choice — accepting a temporary MOE requirement in exchange for stimulus money — was “voluntary.” The choice between accepting a continuation of the MOE rules and losing all Medicaid funding is not.

Even if the MOE provision were not considered part of the Medicaid expansion, and merely a revision to the traditional Medicaid program, the provision would be unconstitutional under NFIB insofar as it seeks to use Medicaid funding to coerce states into adopting new programs. Forinstance, the PPACA provides that once a state has adopted other policies, such as creating a qualifying health insurance exchange, the MOE requirement is lifted. So the MOE provision operates so as to condition Medicaid funding on the state’s cooperation with other policies, crossing the line of what is permissible under NFIB.