Trying to knock out Obamacare on a technicality

The Pacific Legal Foundation, a Sacramento-based advocacy group for limited government, is challenging President Obama's Affordable Care Act.
(Charles Dharapak / Associated Press)

How’s this for some legal jujitsu: Opponents of the 2010 healthcare law are trying to use the Supreme Court’s ruling that upheld its constitutionality to support their argument that it’s unconstitutional.

Wait, what?

The Pacific Legal Foundation, a Sacramento-based advocacy group for limited government, is seeking a do-over of sorts on the legality of the individual mandate: the law’s requirement that virtually all adult Americans carry comprehensive health insurance starting in 2014. The Supreme Court tackled that question head-on in 2012, ruling that the mandate amounted to a tax that Congress had the authority to impose.

On the surface, that ruling appeared to negate all the lawsuits that Obamacare opponents had filed against the mandate, including the one that the Pacific Legal Foundation had filed on behalf of Matt Sissel, an artist in Washington state who did not want to have to buy health insurance. But the foundation amended Sissel’s complaint with a new angle: Instead of arguing that Congress had exceeded its authority, it contended that the law violated the constitutional requirement that revenue measures start in the House of Representatives. That’s known as the origination clause, and it’s found in Article I, Section 7.


In short, the foundation was arguing, now that the Supreme Court had declared the mandate a legal tax increase, that the courts had new grounds to declare it unconstitutional. And because the mandate is an essential feature of the law as a whole, the foundation argued, the entire Affordable Care Act should be thrown out.

This is clever lawyering, but it’s not without some (potentially fatal) flaws.

First, the bill (HR 3590) that became the Patient Protection and Affordable Care Act did, in fact, originate in the House as a revenue bill.

Admittedly, the original version of HR 3590 had nothing to do with healthcare or insurance. Instead, it would have given service members who’d been deployed overseas more time to claim a temporary tax credit for first-time home buyers. The Senate substituted the language of the Affordable Care Act for the text of HR 3590, then sent it back to the House for final approval.

The foundation argues that this maneuvering was improper for two reasons: The House bill didn’t propose to raise revenue, and the Senate amendment wasn’t germane. Hence, it’s not really a House-originated revenue bill.

The House version of HR 3590 did seek to raise revenue, however, to pay for the extended tax break; among other things, it would have increased the tax penalty on certain businesses for filing a late tax return. That seems to nullify half of the foundation’s case. You could argue that the purpose of the original bill wasn’t to raise revenue, and that it was designed to break even, not fatten the republic’s coffers. But the Affordable Care Act wasn’t designed to raise revenue either, and the tax penalties imposed by the individual mandate will fall far short of covering the measure’s costs.

As for the germaneness argument, the foundation cites two Supreme Court rulings from the 1910s as well as several appeals court rulings in the subsequent decades. It does raise an intriguing question: Is the point of the origination clause to give the House control over the parameters of federal tax law, or just over whether there will be any changes in it at all? Because if there’s no germaneness requirement, the Senate would be free to propose all manner of changes in tax law as long as the House passed at least one tax bill of any kind.


Yet that’s pretty much how things are done in the Senate, whose rules impose no germaneness requirement. The appeals court judge in the case, by the way, is a former aide on the Senate Judiciary Committee who is well versed in Senate procedure.

Senate rules don’t trump the Constitution, obviously; the bottom line is what the Constitution means when it says the Senate has the power to “propose or concur with amendments” on House revenue bills “as on other bills.” If the Senate’s power to amend revenue bills is no different from its power to amend any other bill, where does the germaneness requirement for tax measures come from? Because you won’t find it in the text of the Constitution.

The lower court disagreed with the foundation’s reasoning, ruling against Sissel in June. It held that the Affordable Care Act didn’t violate the origination clause because that provision applied only to measures whose purpose was to raise revenue. And even if the origination clause applied, the court held, the Affordable Care Act satisfied it because HR 3590 started in the House.

It’s worth noting that the healthcare bill the House passed in November 2009, HR 3962, would have enforced the individual mandate with a tax penalty very similar to the one in the Senate-passed bill. And had the Senate used that measure as the vehicle for its version of the Affordable Care Act, the legal fight over the mandate might be over by now. Instead, the Senate eventually used HR 3962 as a vehicle to temporarily halt an impending cut in Medicare payment rates for healthcare providers and make tweaks to pension law.


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