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April 16, 2012

Legal pundits, on a quest for eyecatching headlines, didn’t hesitate to make bold predictions in the aftermath of the Supreme Court’s health care arguments. “Justices poised to strike down entire health care law,” one major publication wrote. Another went with this not-so-subtle headline: “Health Reform in Supreme Court: End of Affordable Care Act?” And a leading television commentator said simply: “The individual mandate looks pretty doomed to me.”


My response: Not so fast.

Sure, the court had tough questions for the government, and several conservative justices seem like locks to vote against the individual mandate. But at least one vote the law’s challengers absolutely must have to win – Justice Anthony Kennedy’s – appears far from certain. And even if the mandate were to fall, that would leave a big question looming: What to do with the rest of the law? On that point, the court offered no clear signals.

I attended oral argument and wrote about it for the AHA. It was a three-day whirlwind: Each day began with a five-hour wait to squeeze into the courtroom, followed by an hour of politico-watching – at one point NPR’s Nina Totenberg and
NBC’s Pete Williams were standing beside me whispering to each other, “There’s Mitch McConnell! And Eric Holder! And what about Sebelius? Is Sebelius here?”– several hours of argument, and then a mad rush to craft timely summaries. The dust has now settled. Here, with the benefit of a few days to reflect, are my bottomline takeaways.

Don’t believe everything the justices say. Some of those covering the argument were quick to take the justices’ questions as clear signs of how they’ll vote. That is a dangerous game. The trouble is that judges don’t always show their hand at oral argument. They will sometimes play devil’s advocate; other times they’ll ask tough questions of the side they support to test the soundness of the arguments; other times they may genuinely be on the fence. All of that said, some of the justices’ questions on the individual mandate so clearly favored one side – and so clearly reflected the justices’ long-held positions on the legal issues – that it’s safe to make some predictions. It seems clear, for example, that the Court’s four Democratic appointees (Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor and Elena Kagan) think the individual mandate is constitutional. It also seems clear that Justices Antonin Scalia, Samuel Alito, and (probably) Clarence Thomas think it is not. Which leads to my second point. . .

Justice Kennedy is the key. Justice Kennedy is often called the court’s “swing vote” – the most moderate justice amid four reliable conservatives and four reliable liberals. Many pundits focused on Kennedy’s comments that the mandate is “a step beyond what our cases have allowed” and that it “changes the relationship of the federal government to the individual in a very fundamental way.”

That suggested, they said, that he’ll vote to strike the mandate down.

But Kennedy offered comments of a very different stripe later in the argument – comments that may hold the key to the case. When the plaintiffs’ lawyers stood up, Kennedy twice asked whether “the young person who is uninsured is uniquely proximate to affecting the rates of insurance and the costs of providing medical care.” Translated into English, Kennedy was suggesting that non-participants in the health insurance market – i.e., “the young person who is uninsured” – may nonetheless be connected to that market in a way that isn’t true of non-participants in other markets.

That is important for two reasons.

First, it suggests Kennedy sees a way to justify federal regulation, under the Commerce Clause, of people not engaged in “commerce.”

Second, it suggests Kennedy could write an opinion upholding the mandate but warning Congress that product-purchase mandates in other contexts will not pass muster.

Of course, this is all speculation of the kind I just warned against; Kennedy may simply have been testing out an idea he never accepted or will eventually discard. But his comments create enough doubt to undercut the media doomsayers. To my mind, Justice Kennedy is firmly in the “unknown” camp – and without his vote, the “Patient Protection and Affordable Care Act’s” (ACA) challengers likely can’t muster the five votes they need to strike down any part of the law.

Severability is anyone’s ballgame. If the court does invalidate the individual mandate, that leaves a second question with sweeping ramifications for the nation’s hospitals: Should some, or all, of the ACA’s remaining provisions be left in place? That question – known in legal parlance as the “severability” issue – appeared to divide the court on several fronts.

Some justices, including Kagan and Sotomayor, suggested their support for the government’s position: that if the mandate falls, the guaranteed issue and community rating provisions must fall too (because they are intimately connected to the mandate) but the rest should remain. Some others, including Scalia and Kennedy, suggested their support for the plaintiffs’ position that the whole law should fall if the mandate is invalid. But much of the court appeared confused about how to even approach the question.

Courts conducting “severability” analysis theoretically inquire into Congress’ intent: Would Congress have wanted the rest of the law to stand with the invalid part removed?

But as several justices pointed out, answering that question here is almost impossible. The law has hundreds of provisions, some connected to the mandate and others not. And in some cases, the connections aren’t immediately clear. How is the court to decide which to keep and which to jettison? And how can it really know what Congress would have wanted, given that the law is an interlocking nest of compromises?

In the end – and despite media claims that the court is “poised to strike down [the] entire health care law” – it’s impossible to predict what the court will do about severability if, in fact, the mandate is struck down. The bottom line is the same as for the mandate: We can’t really know anything until the decision comes down in June. The pundits will just have to wait.

Perella was one of the lead authors of the AHA’s briefs on the constitutionality of the ACA. He practices Supreme Court and appellate litigation at Hogan Lovells US LLP in Washington, DC. He blogged about the ACA arguments for the AHA at www.ahahealthreformlaw.wordpress.com 

By Dominic F. Perella