Health Care Wrap-Up

What the papers are saying about the Virginia decision

Federal judge Henry E. Hudson of Richmond, Va., ruled yesterday that the Affordable Care Act’s requirement that most Americans obtain health insurance was unconstitutional. In his forty-two page opinion, Hudson took issue with the provision known as the “individual mandate,” writing, “Neither the Supreme Court nor any federal circuit court of appeals has extended Commerce Clause powers to compel an individual to involuntarily enter the stream of commerce by purchasing a commodity in the private market.” The crux of the case, the question of the Commerce Clause, is nicely outlined in this graf from the Times’s front page story on the decision today:

The case centers on whether Congress can use its powers under the Commerce Clause to compel citizens to buy a commercial product—namely health insurance—for the purpose of regulating an interstate economic market. Absent that authority, the administration argued, Congress could use the taxation powers granted by the Constitution to justify the insurance requirement, because the fine for not obtaining coverage will be assessed as an income tax penalty.

Most of the major daily coverage this morning has been sharp, outlining Hudson’s decision, ruminating on the future of the law, and placing the ruling in context—Hudson is an unabashed, potentially “activist” conservative; two previous, similar cases, one in Detroit and one in Lynchburg, Va., have upheld the law; and the case is one of twenty or so that have been filed, challenging the Obama health care law. And mostly reporters have avoided the temptation to overplay the decision as an end to Obamacare, instead outlining it, rightly, as something of a speed hump.

Still, each has given the case its own twist. The coverage ranges from significant doom and gloom—most pronounced perhaps across the pond in Richard Adams’s Guardian blog post (“Obama’s healthcare reforms are looking sick”)—to the more measured—The Washington Post is even-handed in its assessment that the ruling provides mixed holiday blessings for both political parties.

McClatchy’s story, “Virginia Judge rules health care law unconstitutional,” is a good place to start if you’re after the basic nuts and bolts. Margaret Talev and Michael Doyle’s report is comprehensive and nuanced. First, there’s the context, and a brief sketch of the players and their leanings:

Some 20-odd cases have been filed overall challenging the law.

White House officials and advocates of the law emphasized that Hudson’s ruling is no more important than two recent rulings by federal judges that upheld the mandate. In October, U.S. District Judge George Steeh in Michigan ruled the insurance mandate fit within congressional power under the Constitution’s Commerce Clause. On Nov. 30, U.S. District Judge Norman Moon in Lynchburg, Va. ruled the same.

The Commerce Clause explicitly states that Congress can “regulate commerce…among the several states,” although the Supreme Court has struggled for years to decide what activities this covers.

“There is a rational basis for Congress to conclude that individuals’ decisions about how and when to pay for health care are activities that in the aggregate substantially affect the interstate health care market,” Moon declared in his 54-page opinion.

Steeh and Moon were both appointed by President Bill Clinton. Hudson is a nominee of President George W. Bush.

The reporters also hit the phones to speak to the experts about the future—with political scientist Andrew Koppelman echoing the line in most reports that it will be 2011/2012 before the case winds up in the Supreme Court. What McClatchy does better than most of the others is dig a little deeper on the step-by-step of what comes next, lacing it all with the appropriate political intrigue.

An appeal of Hudson’s ruling would go to the Richmond, Va.-based Fourth Circuit Court of Appeals, generally considered among the nation’s most conservative. Conflicting appellate court rulings fall to the Supreme Court to resolve. The 63-year-old Hudson graduated from American University Law School, which he attended at night. Prior to his appointment to the bench, he served as a federal prosecutor and as director of the U.S. Marshals Service. Though approved by the Senate on a voice vote, with no stated Democratic opposition, his conservative leanings are well known.

Hudson’s personal financial disclosure statements filed through 2009 showed he is an investor in Campaign Solutions Inc., a Virginia firm which has done work for assorted Republican politicians including 2008 presidential candidate John McCain and his running mate, Sarah Palin.

Hudson himself is a major figure in the Times front page report today; a report that lays its position on the table early—“The insurance mandate is central to the law’s mission of covering more than 30 million people who are uninsured.” As painted by the Times, yesterday’s decision was fueled by politics and part of a larger political clash.

The opinion by Judge Hudson, who has a long history in Republican politics in Northern Virginia, continued a partisan pattern in the health care cases. Thus far, judges appointed by Republican presidents have ruled consistently against the Obama administration, while Democratic appointees have found for it….

…That has reinforced the notion—fueled by the White House—that the lawsuits are as much a political assault as a constitutional one. The Richmond case was filed by Virginia’s attorney general, Kenneth T. Cuccinelli II, a Republican, and all but one of the 20 attorneys general and governors who filed a similar case in Pensacola, Fla., are Republicans.

The Wall Street Journal’s report, like the Times’s, is comprehensive, and gives more airtime to Cuccinelli, which leads to this interesting tidbit, downplayed by other outlets and sure to scare a college student or two. It is possible that a disallowed individual mandate could affect more than the pre-existing condition requirement and the rule that insurers must charge all consumers similar prices.

Mr. Cuccinelli said he believed the ruling also applied to the provision that allows children to stay on their parents’ insurance policy until they turn 26 years old, which went into effect this year. Administration officials said they were still assessing whether that provision, which is also popular, or others would be tied to this ruling.

In acknowledging the kinds of liberal complaints against Hudson that are latent in the Times report, the Journal proceeds to outline them in fuller detail.

Liberals have complained about the fact that Judge Hudson is an investor in a political-consulting firm that has done work for Republicans including Mr. Cuccinelli and former Alaska Gov. Sarah Palin. The judge’s financial-disclosure forms for 2009 show that he received between $5,001 and $15,000 in dividends that year from the firm, Campaign Solutions Inc.

Mr. Cuccinelli’s campaign paid $8,852 to Campaign Solutions in 2009 and 2010, according to the Virginia Public Access Project, a nonpartisan campaign-finance website. Campaign Solutions and Judge Hudson couldn’t immediately be reached for comment Monday, but Campaign Solutions has said that the judge was a passive investor who wasn’t involved with the firm’s day-to-day operations. Mr. Cuccinelli stopped using the firm when he found out the judge was a shareholder, a Cuccinelli spokesman said.

The Washington Post’s solid front page report from Rosalind S. Helderman and Amy Goldstein outlines in some detail the arguments and counter-arguments of Virginia and the DOJ:

The Obama administration countered that health care - and health insurance - are unlike any other form of commerce because everyone will, at some point, need care. As a result, the Justice Department argued, the government has a stake in that decision because the costs of caring for the uninsured will ripple into the insurance market and the rest of the health-care system.

Hudson sided with Virginia, finding that “an individual’s personal decision to purchase - or decline to purchase - health insurance from a private provider is beyond the historical reach of the Commerce Clause” and that the mandate “is neither within the letter nor the spirit of the Constitution.” The judge also sided with Virginia on the argument that the law’s fine for people who refuse to buy coverage is a penalty not a tax and thus illegal.

And the Post declares yesterday a political draw:

But the opinion is a partial win and a partial loss for the law’s foes and supporters alike, according to legal and health-policy specialists. Its immediate practical effects - on patients, the health-care industry or regulators writing the fine print of how the statute will be carried out - will probably be slight, specialists say….

… “It’s important to distinguish between the theater and the politics, and the implementation [of the law], which is still being carried out,” said Drew E. Altman, president of the Kaiser Family Foundation, a health-care research and policy organization.

Interestingly, the usually unsubtle Politico has a nuanced report which both gets at why a verdict like this, particularly if it sticks, is important, and homes in on why it may be less important than it seems.

Administration officials concede that the lack of a mandate would cut the number of uninsured people who would get coverage in half and threaten the ban on denying coverage to people with pre-existing conditions - one of the president’s signature selling points on the law. The insurance industry has maintained that it needs the individual mandate—and the healthy people who would presumably buy insurance because of it—in order to be able to offer coverage for pre-existing conditions and to lift caps on lifetime limits….

…“While the Virginia case is important and has drawn strong media interest, it is no more important than the many other rulings by judges of equal rank who have determined that the law is constitutional or have issued dismissals on procedural grounds,” says Ethan Rome, executive director of Health Care for America Now.

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Joel Meares is a former CJR assistant editor. Tags: , , , ,