Tagged: federalism

12

Pre-postmortems

I was fortunate to hear Justice Ginsburg’s speech at the ACS National Convention on Friday evening, during which she reiterated her position about the value of dissents (to signal how Congress could change the law [think Ledbetter], and to make a point for historical purposes [think Gonzales v. Carhart]).  Of course, everyone in the audience was abuzz that Ginsburg was hinting at a dissent in Florida v. HHS, even though many were Court watchers who know better than to act as Supreme Court soothsayers. 

Every day brings more public speculation about the future of PPACA, and everyone seems to be making contingency plans.  This phenomenon may speak more to the unpredicability of the Roberts Court than it does to the merits of the arguments.  The current Court has been willing to revisit precedent, tweak it, sometimes even overrule it, and such willingness makes outcomes difficult to predict.  I also wonder if this speaks to the undertheorization of the Rehnquist Court’s federalism revolution (with nods to Dan and Paul over at prawfsblawg).  After all, Lopez is really a summary and categorization of existing commerce power precedent with a traditional state power overlay.  The commerce power has a long history of interpretation, including the seminal “plenary power” description from Chief Justice Marshall.  But, little tells us how the Roberts Court will read the Commerce Clause. 

This is even more true for the spending power question in the case.  The spending power is so undertheorized it basically has no theory.  The Dole test for conditional spending is merely a Rehnquist-style summary and categorization of prior spending precedent, but none of that precedent provides a theory either, unless you believe the contract analogy from Pennhurst rises to the level of theory.  The power to spend also has no early, foundational Marshall interpretation like Commerce or Necessary and Proper.  Given that the federal government lacked significant ability to spend until the Sixteenth Amendment was ratified in 1913, the lack of early precedent is unsurprising.  But, the first case to provide a heuristic (U.S. v. Butler ) merely affirmed that the Hamiltonian view of the power to spend was correct, that spending is an enumerated power.  Not only did that case avoid expressing a theory for interpreting the General Welfare Clause, it went on to limit Congress by the Tenth Amendment, thus arguably producing a self-conflicting result.  With no underlying theory, the federalism questions and topic-specific healthcare questions stand on a house of cards.

So, why all the pre-postmortems?  Maybe because we still haven’t figured out what most advanced countries did a long time ago – we all do better when we are all well.  I was speaking with someone from Scotland recently, and he was befuddled by the fight over achieving universal health insurance coverage in the United States.  He asked a question that should have been rhetorical, “Isn’t healthcare a good thing?”  If we haven’t decided that healthcare is both essential and good for all of our citizens, then no amount of preparation will facilitate the actual postmortems.

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Pondering the vehicle for change

I have just returned from the perennially-satisfying Health Law Professors Conference at ASU (where it was hot enough to singe your eyebrows).  For folks interested in any aspect of healthcare law, this conference is highly recommended; the panels are strong on substance, the people are unfailingly collegial, and the event is bound to be near you at some point, as it moves to a different law school each June.  This year I shared a panel entitled “Theories of Health Reform in the United States” with three excellent speakers, including CoOp co-guest blogger David Orentlicher (Rights to Health Care in the United States: Inherently Unstable)Abby Moncrieff  (Healthcare Federalism, Healthcare Rights, and the ACA), and Christina Ho (Recursivity and Health Reform in the US: An Application of Niklas Luhmann’s Essays on Self-Reference). 

I gave my talk the hilariously vague title “Healthcare as a Vehicle for Constitutional Change” when I submitted the abstract many months ago.  It turned out, though, that this title was both useful and not a red-herring.  I presented elements of an essay on Post-Reform Medicaid, including a point I mentioned here in December that the United States has not told a consistent story about Medicaid to the Court this term.  In Douglas v. Independent Living Center, the Solicitor General articulated a deferential stance toward the states, a position consistent with longstanding states’ rights concerns in the Medicaid program.  On the other hand, the federal government has advocated a very broad view of federal authority under the spending power to modify and expand Medicaid in Florida v. Health and Human Services. Adding to the confusion, Congress has acted in ways that are contradictory regarding Medicaid throughout the program’s history, and those conflicting attitudes have been accentuated by the executive branch’s dissonant litigation strategies this term. 

I posited that these competing visions make it difficult for the Court to get the decision in Florida v. HHS “right.”  If the United States cannot present a cornerstone of the universal health insurance design in a coherent manner, then the Court’s job is much harder in both Medicaid cases this term.  It seems that the healthcare aspect of Florida v. HHS has been lost before the Court, making healthcare a sub-optimal “vehicle for constitutional change.”  The pithy decision issued in Douglas provides an example.  While the Breyer majority articulated concern for Medicaid as a program in enunciating the reasons to allow HHS to exercise primary jurisdiction, the Roberts dissent only described Medicaid as “spending legislation” and jumped right to federalism, spending power questions, and clear statement rules.  It is easy to see how the Court could jump to the big constitutional questions in Florida v. HHS.  (It also happens that the result in Douglas aligns with a study published in Health Affairs regarding political affiliation and attitudes toward healthcare access, but that is probably a topic for anther day.)

The Medicaid expansion is predicted to cover 16 million new lives; added to the existing 69 million Medicaid enrollees, Medicaid would become the nation’s largest health insurer covering some of our most medically-fragile and poorest citizens.  Much is at stake on the ground, but healthcare may not be a very good vehicle for the change that could be approaching.

4

Landscape of the Amici Supporting Florida’s Medicaid Brief

Reporting results for its monthly Health Tracking Poll published today, the Kaiser Family Foundation introduced the summary of its findings thus:  “As the Supreme Court prepares to hear legal challenges to the health reform law in March, most Americans expect the Justices to base their ruling on their own ideological views rather than their interpretation of the law…. Other key findings include:  The public doubts the Supreme Court renders judgments based solely on the law. Three-quarters (75%) say they think that, in general, Justices let their own ideological views influence their decisions while 17 percent say they usually decide cases based on legal analysis without regard to politics and ideology….”  Notable for a term that has the potential to render a few blockbuster cases.  (The public’s opinion of the Court is worthy of its own conversation, but it’s best left for another post.) 

It is not just the general public that believes politics will win out; amici supporting the states seem to be appealing to ideology.  In reading all of the amicus briefs supporting Petitioners’ claim that the Medicaid expansion is unconstitutionally coercive, several themes reflecting this strategy emerge, such as:

  • Rejection or non-acceptance of New Deal era programs and precedents (the foundation of spending programs such as Medicare and Medicaid).
  • Asking the Court to invent a coercion doctrine to limit the power to spend and/or seeking a return to U.S. v. Butler, the 1936 decision that articulated a Hamiltonian understanding of the power to spend as a separate enumerated power but that also declared the provision of the act at issue to be unconstitutional as infringing on states’ rights.  (One brief even seeks reversal of Butler’s adoption of the Hamiltonian view in favor of the Madisonian view that the power to spend only supports the other enumerated powers.)
  • Eschewing precedent - paragraphs unfold with no cites (the Texas brief is a good example).  Citations that do exist are often to concurrences, dissents, scholarship, or think-tank reports.  Justice Kennedy’s concurrences and dissents are well represented. 
  • Providing a limited picture of the Medicaid Act and the expansion by failing to account for prior mandatory modifications to the program as well as the statutory architecture of the program (which contains both mandatory and optional elements). 
  • An assertion that states cannot leave Medicaid because the federal government somehow improperly taxes state citizens, therefore states cannot tax their populations enough to pay for a state-based Medicaid equivalent. (This reflects an argument articulated by Professor Lynn Baker in her spending power articles, though it is not always attributed.) 
  • Hyperbolic analogies (such as characterizing states as drug addicts).

 A couple of additional thoughts come to mind in reading the amicus briefs:

  • State dependence on federal funding speaks to state behavior, not federal.  
  • Coercion is too nebulous and perverse to be a coherent constitutional doctrine. This is illuminated by the amicus briefs, which essentially assert that the more money the federal government offers, the less control it should be able to exercise over either the money or the states.
  • The Court has no standard by which to judge whether the federal government offers too much money to states.  Too much money relative to what?  If healthcare is expensive, then in a cooperative federalism arrangement the federal government must offer sufficient money to encourage a state to implement a program that will be costly.  The sum of money speaks to the nature of the program, but it does not dictate whether the federal government may permissibly offer the money to the states. 
  • The tax argument is a distraction that denies the existence and purpose of the 16th Amendment as well as long-standing reliance on redistributive tax policy.

Despite the Medicaid expansion being the surprise question before the Court for many observers, it may dictate the outcome of the case.  The Court could dodge the Commerce Clause question by virtue of the Anti-Injunction Act but still limit congressional authority by adopting the anti-federal spending position of the states and their amici.  An additional theme - that Medicaid is essential to the minimum coverage provision – could make it so that Medicaid is the downfall of PPACA rather than the individual mandate.  Such a result would fly in the face of severability jurisprudence; but, much about this litigation is unprecedented.

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Getting the Facts Right

For those of you following the Medicaid expansion issue before the Court: Sara Rosenbaum and Katherine Hayes, experts on the Medicaid program and health policy at GW, have posted a thoughtful response on the Health Affairs blog to the states’ misleading discription of the Medicaid program (which I also mentioned in my initial impressions of the states’ merits brief).  Briefs supporting the states’ coercion position were just filed, and I will post initial impressions of the amici soon.

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Initial impressions of the states’ brief in Fl. v. HHS

Is the sky falling?  According to Florida et al., which filed their brief regarding PPACA’s Medicaid expansion today, the answer is a resounding yes.  In many respects, this brief rehashes the coercion arguments made in the district court and Eleventh Circuit.  The states continue to argue that they cannot afford the Medicaid expansion that will occur in 2014 (which I discussed on this blog here, here, and here), even though the federal government will pay 100% of the cost initially; and, they cannot afford not to participate in Medicaid because the costs of their medical welfare populations would be too high.  Thus, the states claim to be coerced into accepting this “onerous” new condition on federal funds.  Again, these arguments are not new. 

One aspect of the brief that was new was the inclusion of the severability arguments through describing the Medicaid expansion within the context of the universal insurance aspirations of PPACA (see especially fn. 18).   The states essentially contend that the minimum coverage requirement (“individual mandate”) gives impoverished Americans no option but to be in Medicaid, which in turn makes it so that the states cannot opt out of Medicaid.  The states further assert that this was Congress’s plan – to coerce the states by giving the poor no other options for obtaining minimum insurance coverage.  The fallacious assumptions underlying this argument are too numerous to unpack at this late hour, but at least two thoughts can start the job: first, New York v. U.S. does not require the federal government to offer alternatives to conditional spending programs (unlike, say, when it exercises commerce authority – the insurance exchanges in PPACA, which are a point of contrast in the brief, are an exercise of Commerce Clause authority, and states can either create them with some federal funding or reject them and the federal government will create the exchanges in the states that choose not to act — all of this fits neatly within the New York architecture).  Second, suffice it to say that the impoverished are not seeking private insurance alternatives to Medicaid.

Medicaid’s history is skewed by the brief more greatly than it was at lower court levels.  For example, the brief ignores the fact that Medicaid has always contained mandatory elements; these mandatory elements were one of the major defining features of the program as it was amended from Kerr-Mills, its predecessor program.  The brief also misrepresents the existence of mandatory eligibility and coverage standards and how they serve the aspirations of the program.  Likewise, the brief either misunderstands or misrepresents the minimum essential coverage requirement, which is actually more flexible for states than the mandatory coverage provisions for other Medicaid populations.  Additionally, the brief appears to misunderstand the statutory clarification that Medicaid provides both care and service (Congress here was responding to lower federal courts that had misconstrued certain language in the Medicaid Act).

Also, decisions such as Arlington, Dole, and Pennhurst that have required clear notice of conditions on spending are cited in the brief to support the states’ position that they have not voluntarily agreed to this condition on spending.  Before this point, the states have not argued that any other Dole element was violated, but the states now seem to indicate that these conditions were not unambiguous and thus the ‘contract’ with the federal government is unconstitutional.  In addition, the states offer a limiting principle that adopting their view of the coercion theory does not threaten other federal spending programs because Medicaid is by far the largest federal spending program (echoes of the federal government’s argument that nothing else is like healthcare).

Bottom line, the states want the Court to revive Butler and to expand the theory of coercion that the Court merely acknowledged in Dole and Steward Machine by relying heavily on Justice Kennedy’s concurrences and dissents that have expressed an interest in such an expansion.  The question is whether a majority of the Court is interested in a new limitation on Congress’s power to spend.

0

The other healthcare case with constitutional implications

Another Medicaid case this term also involves constitutional challenges – Douglas v. Independent Living Center of Southern California That certiorari was granted is notable unto itself, as no circuit split existed, the Acting Solicitor General had recommended that the Court deny the petition, and the Court does not seem to relish hearing healthcare cases.  The conflict in Douglas is whether California violated the Medicaid Act by enacting 10% reimbursement rate reductions, but this is not the question before the Court.  The Court will consider whether the plaintiffs (a group of Medicaid providers and enrollees) may privately enforce the Medicaid Act against the state by claiming the state has violated the Supremacy Clause.  Depending upon the timing of the opinion, Douglas may give us hints as to how the Court will decide Florida v. HHS,  even though the United States has taken notably different positions in the two cases (about which I have written more here.)

Medicaid was intended to mainstream the poor into American medicine.  The Medicaid Act thus informs states that they must pay healthcare providers “sufficient[ly]” to ensure the same access to medicine for Medicaid enrollees as others in the geographic region enjoy.  This “Equal Access” provision is a pillar of Medicaid, and it has been a source of litigation against states that pay providers too little.  In fact, before Gonzaga, lower federal courts were in agreement that the Equal Access provision was enforceable via section 1983.  Through this litigation, the circuits developed varying methods for deciding sufficiency of payment, as the Centers for Medicare and Medicaid Services (CMS) has not enforced the Equal Access provision vigorously against the states.  Despite the lack of agency action, “sufficiency” is key to Medicaid’s success; if states do not pay enough for the medical services they buy, Medicaid enrollees will be forced into substandard care or will not be able to find caregivers at all, and the program would be undermined.  Due to Gonzaga, and because CMS infamously does not monitor the states, Medicaid providers and enrollees have sought to enjoin states from violating the Medicaid Act under the Supremacy Clause.

California argued that the Medicaid Act does not include private actions, thus the plaintiffs could not seek an injunction because the statute fails to meet the “unambiguous conditions” element of the Dole test for conditional spending.  This argument speaks to clear statement advocates on the Court (such as Justices Alito, Scalia, and Thomas), because it claims that states do not have clear notice of Medicaid enforcement actions in federal court.  To the surprise of many, the United States’ amicus brief not only supported California but also urged that no private right of action exists for beneficiaries of federal spending programs (generally) to enforce federal standards against states.  The Acting Solicitor General’s brief thus took a much bolder position than was expected.  Remarkably, members of Congress and ex-administrators of the Department of Health and Human Services strongly disagreed with the SG’s position.  In fact, the ex-administrators, which represent both sides of the aisle, insist that CMS relies heavily on private enforcement to police the states.

Douglas may lead the Court to articulate a default rule that ends implied private rights of action under the Supremacy Clause, but Medicaid is a flawed vehicle for such a sweeping, federalism-based decision.  [More after the jump.]

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An additional thought on coercion

Recently I wrote about the coercion question posed by Florida et al. in the PPACA litigation.  I have a quick follow up thought: I wonder if those advocating a more robust read of coercion recognize that their position could backfire if the goal is broadening federalism protections.  An expanded coercion doctrine ostensibly would introduce the possibility of judicially enforcing states’ rights against the congressional power to spend.  But the states should not assume that they are the only parties that could enforce federalism principles.  Just last term in Bond v. United States, Justice Kennedy wrote that individuals can have standing to enforce the principles of the Tenth Amendment against the federal government because federalism protects not just the states but also individuals.  In Bond, the conclusion was foreseeable, as a criminal defendant should be able to challenge the constitutionality of the statute under which she is charged.  But the idea is muddied in a conditional spending program, wherein individual beneficiaries are often at odds with the state and contest its compliance with the federal government’s statutory conditions. 

States have sought to prevent private enforcement of conditional spending statutes, and they have been more and more successful in closing the courthouse doors.  For example, the Court has limited implied rights of action as well as actions under civil rights law 42 U.S.C. § 1983, decisions that narrow state exposure in federal court.  In fact, this type of question is before the Court now in Douglas v. ILC, which confronts private enforcement of the Medicaid Act against states via the Supremacy Clause.

If the coercion theory is expanded, then private plaintiffs could be reintroduced into the federal courts, the very thing that states have been trying to prevent.  And, individuals engaging in coercion analysis may have different goals than states.  Further, it is possible that coercion could inaugurate a new theory by which those conditions, and the ways in which they are or are not executed by states, can be challenged by private plaintiffs.  So, not only is state coercion by the federal government an inherently sticky question, but it also may not produce results that states desire.

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Jumping ahead to Coercion

I had intended to address Douglas next, as it is a nice gateway for discussing Florida v. HHS, but a defense of the coercion argument just published in the New England Journal of Medicine Online inspired me to address the latter first.  I will begin by discussing why I think the Court granted the petition for certiorari then turn to the Medicaid coercion question. 

The Rehnquist Court excluded the Spending Clause from its federalism revolution inasmuch as that would have meant limiting the power to spend by the Tenth Amendment.  When Chief Justice Rehnquist authored South Dakota v. Dole, the evidence is that he believed it was an easy and relatively inconsequential case.  For those sane enough not to engage in the reading of tea leaves that is deciphering the spending power, a quick review.  Dole articulates typical Rehnquist categories for evaluating the constitutionality of conditions placed on federal spending:  the spending must be for the general welfare; the conditions must be clear and unambiguous (as modified by Arlington Central School District Board of Education v. Murphy); the conditions must have a nexus with the federal spending (“germaneness”); and the conditions cannot themselves be unconstitutional.  After providing this test, Rehnquist noted that “in some circumstances the financial inducement offered by Congress might be so coercive as to pass the point at which ‘pressure turns into compulsion.’”  No theory or constitutional provision was cited, but the opinion indicated that coercion would depend on the amount of money or percentage of money withheld if the state violates the conditions.  It seems that the Court meant that coercion would be a Tenth Amendment, state sovereignty problem.  But, Dole also explicitly stated that the Tenth Amendment was not implicated in the bar on unconstitutional conditions.  So, while Dole provides the test for conditional spending, it is undertheorized and a bit self-contradictory.  Nevertheless, the Rehnquist Court reiterated that the Spending Clause is not limited by the Tenth Amendment in New York v. U.S. and held to that position in subsequent cases, disappointing many who believed spending to be the next front in judicially-enforced federalism.

The Roberts Court has given hints now as to its approach to spending as well as federalism, and members of the Court have signaled interest in revisiting both topics.  For example, Justice Kennedy’s concurrence in Comstock stated: “The limits upon the spending power have not been much discussed, but if the relevant standard is parallel to the Commerce Clause cases, then the limits and the analytic approach in those precedents should be respected.”  Justice Kennedy also addressed broader federalism concerns in that concurrence, which were given free rein in his opinion for the Court in Bond v. U.S. as well.  Likewise, Justice Alito’s opinion in Arlington was written as a spending power decision rather than a limited statutory interpretation, which I have written elsewhere resulted in a narrower clear statement rule for the second element of the Dole test.

Additionally, even though the Court seems to dislike hearing both spending and healthcare cases, it already has heard Douglas this term, so spending, federalism, and Medicaid are fresh in the justices’ minds.  And, what could be a better vehicle for considering coercion than the largest grant-in-aid program that also constitutes the second largest portion of states’ budgets?  (Education is first.)  Further, numerous lower federal courts have attempted to construe coercion, but none have struck down federal legislation under the doctrine, making the issue ripe for the Court’s consideration.

Despite the idea of coercion arising repeatedly in federalism cases over the last thirty-ish years, its contours are unknown.  At what point is the money being offered too much? And is the offer really the issue, or is the problem the amount or percent of money a state stands to lose if it does not comply with the conditions?  (Dole indicated the latter, as South Dakota was not coerced because it would lose only 5% of its federal highway funding if it refused to comply with the minimum drinking age that the federal government sought to impose.)  Can coercion only apply to an existing conditional spending program that a state could not leave because it has become dependent on the program?  Or is there some federal program that would offer so much money that no state could turn it down, even at the outset, such that the new program would be coercive?  If it is the former, then clear statement rules also need to be revisited, because they seem to assume some kind of regular restatement of the rules of the program to which a state actively agrees.  That simply does not occur in a long-standing program like Medicaid, making me think that clear statement rules are almost meaningless in that context.  Additionally, states inherently relinquish some sovereignty when they agree to the terms of a cooperative federalism program, highlighting tensions between dual sovereignty and cooperative federalism.

So, what is the upshot for the Medicaid expansion?  [more after the jump]

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22

Return of the Necessary and Proper Clause (Just in Time for Health Care)

The Congress shall have Power . . . To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.  U.S. Const. Art. I, § 8.

The big news last week concerning the fate of the federal health care legislation was not the entrance of new plaintiffs into the litigation challenging the statute or the government’s filing its opposition brief in the suit brought by Virginia.  The big news was United States v. Comstock and the continuing resurgence of the Necessary and Proper Clause of the Constitution (quoted above).

The constitutional challenges focus on the so-called individual mandate, taking effect in 2014, which will require that most people either own health insurance or pay a penalty.  Legally, the arguments against the legislation lack merit.  As I have argued elsewhere, under contemporary Commerce Clause doctrine, Congress can impose the individual mandate as part of its comprehensive regulation of the interstate market in health insurance.  Further, the provision is structured as a tax on those who fail to purchase insurance, thus falling within Congress’s even broader taxing authority.

Rhetorically, however, the opponents’ arguments may have some appeal.  How, the critics insist, can Congress’s constitutional authority to regulate interstate commerce extend to regulating the non-commercial activity of doing nothing (i.e., not buying insurance)?  Doing nothing is not commerce, the law’s opponents proclaim.  Can you make a federal case out of taking a nap?

The answer to this rhetoric comes from the Court’s great rhetorician, Justice Antonin Scalia.

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4

Immigration Federalism: Red and Blue

In a previous post, I discussed some of the federalism implications of Arizona’s recent legislation concerning immigrants.  I noted that in immigration, as in other areas, it is difficult to define enclaves of exclusive state or exclusive federal jurisdiction.  Rather, contemporary federalism entails a dynamic interaction of state and federal authority.

If Arizona’s law constitutes an example of “red state” federalism, a recent announcement by New York’s Governor David Paterson illustrates the “blue state” version of immigration federalism. 

Under federal immigration law, conviction of certain state crimes constitutes grounds for deportation.  But, in many circumstances a subsequent state pardon removes the threat of deportation.  In what The New York Times termed “a major rebuke of federal immigration policy,” Governor Paterson created a panel to assist him in evaluating pardon requests from immigrants subject to deportation based on state convictions.  The Governor characterized some federal immigration laws as “embarrassingly and wrongly inflexible.”  “In New York,” Paterson explained, “we believe in renewal.”

So, now New York has joined Arizona in rebuking federal immigration policy, though from a very different perspective.

Even the United States Supreme Court has gotten into the immigration federalism act.  In Padilla v. Kentucky, decided in March, the Court held that defense counsel’s failure to advise a state criminal defendant that a guilty plea carries a risk of deportation constitutes ineffective assistance in violation of the Sixth Amendment to the United States Constitution.  In what will be one of Justice Stevens’ last majority opinions, he explained that as a matter of federal law, deportation is an “integral part” of the penalty for the state crime.

Padilla confirms the obvious: In immigration, state and federal law are closely intertwined.  What are we to make of this feature of our federal system?  If some are troubled by Arizona’s inhospitable voice, they might find solace in New York’s dulcet tones of “renewal.”  That counterpoint provides cold comfort to immigrants in Arizona, but then the United States Constitution provides some protection for all people throughout the country. 

Complicated? Yes, but simple would be superior only if we all agreed on the answers.  And we do not.  In the meantime, New York seeks to vindicate its immigrant heritage.