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Can Congress force you to buy insurance?
This is an archived article that was published on sltrib.com in 2009, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

As part of health reform, Democrats want to require all Americans to purchase insurance or face a fine. But conservatives, led by Utah Sen. Orrin Hatch, say Congress has no constitutional authority to tell people what to buy with their money.

"If we have the power simply to order Americans to buy certain products, why did we need a Cash for Clunkers program?" Hatch said during a debate in the Senate Finance Committee. "We can simply require Americans to buy certain cars."

Democrats brush aside these arguments and say the proposal is not only good policy, but also is well within Congress's established powers. However, nonpartisan researchers are not as confident.

In a report released in July, the Congressional Research Service said it "seemed possible" that Congress could create a requirement to buy insurance that passed constitutional muster, but that legitimate legal questions remain unanswered.

Republicans have seized on this argument as they try to defeat the Democrats' bill and are likely to tout it during the upcoming Senate debate.

For their part, Democrats have tried to heed the warning while drafting their plan. But it appears almost certain that if health reform becomes law, a personal insurance requirement would face a swift legal challenge.


'Individual mandate' » In Washington, this requirement is regularly called an "individual mandate" and the point of an individual mandate is to prod the uninsured who can afford coverage -- namely younger, healthier people -- to sign up. Supporters say this would have two positive outcomes.

First, it would greatly reduce the cost of caring for the uninsured, which hospitals now pass on to those with coverage. And second, it would hand insurance companies millions of new customers, which would offset the cost of a whole slate of new government regulations. Some of those regulations would prohibit insurers from charging women more than men and from denying people coverage because of pre-existing medical conditions.

All of the major health reform proposals considered by Congress include an individual mandate. The penalty for violating the mandate is different in House and Senate versions, but amounts to a tax penalty ranging from a few hundred to a few thousand dollars.

The bill's supporters have no problem debating the policy surrounding the mandate, but are much less interested in talking about its legal underpinning.

Hatch offered an amendment in the Finance Committee that would allow for an expedited legal review of a potential constitutional challenge. Committee Chairman Max Baucus responded by saying, "These provisions in the bill clearly are constitutional. I think that is fairly clear." He then scuttled the amendment by saying it was out of the committee's purview.

When a conservative news outlet asked House Speaker Nancy Pelosi to defend the constitutionality of a personal insurance requirement, she said "Are you serious?" then moved to the next question.


Defending the mandate » But tucked deep into the Senate's more than 2,000-page reform bill are five pages devoted to defending the constitutionality of the individual mandate and making a case that the requirement would benefit interstate commerce.

According to the bill: "If there were no requirement, many individuals would wait to purchase health insurance until they needed care."

These five pages include references to Supreme Court cases, statistics about nationwide health spending and descriptions of the Massachusetts health plan. It amounts to a pre-emptive legal defense against Republicans, like Hatch, who consider the mandate heavy-handed government.

But not every member of the GOP opposes an individual mandate.

Sen. Bob Bennett, R-Utah, backed an individual mandate as part of a bipartisan health reform bill he pushed with Democratic Oregon Sen. Ron Wyden. Their bill had a handful of other Republican sponsors as well.

The Senate is not seriously considering the "Healthy Americans Act" at this time.

Bennett said this week that the constitutional issues never came up as they crafted their health care fix. He said he looked at the individual mandate in health care as something analogous to the requirement to have car insurance.

Hatch, a lawyer and senior member of the Senate Judiciary Committee, said while people often make the comparison the two are legally quite different. He has tackled that issue head on in the committee debate and in subsequent op-ed pieces, saying states require people to buy car insurance in exchange for the privilege to drive. Under the health reform proposals, he argues, "individuals must buy health insurance whether or not they ever visit a doctor, get a prescription, or have an operation."

States also have much more constitutional leeway than the federal government in these matters, Hatch reasons, which is why he doesn't contend that Massachusetts can require its residents to buy health insurance.


Constitutional justifications? » The July report drafted by the Congressional Research Service, or CRS, sees two possible constitutional justifications for a federal individual mandate. Congress can rely on its power to tax or its power to regulate interstate commerce, which is commonly called the Commerce Clause.

These researchers found that it would be hard to successfully challenge an individual mandate as a tax, but the ties to interstate commerce are not as clear-cut.

"Whether such a requirement would be constitutional under the Commerce Clause is perhaps the most challenging question posed by such a proposal," the report said. "It is a novel issue whether Congress may use this clause to require an individual to purchase a good or service."

The CRS report also laid out an argument on both sides.

Supporters might argue that since most people become ill and require medical care at some point, requiring everyone to have coverage would "benefit the orderly flow of health care services in interstate commerce."

Opponents could counter that if the Commerce Clause can be used "to mandate the purchases of a private individual, it could be perceived as virtually unlimited in scope."

Politicians and law professors have keyed off of this report and continued the debate.


The key question » University of Utah law professor Wayne McCormack says the issue boils down to this key question: "Whether going without health insurance has a substantial effect on interstate commerce."

He said it shouldn't be hard for supporters of an individual mandate to make a compelling case.

"Given the massive amounts by which taxpayers and insured persons subsidize emergency room care for uninsured persons, it probably would be easy to make that argument," he said.

Wake Forest law professor Mark Hall has vigorously defended the legality of an individual mandate. He says the government already regulates the health care industry and a mandate is just a stronger form of regulation.

But even under Hall's argument an individual mandate may be successfully challenged by people who either "never access the health care system" or "are able to pay for their health care without using insurance," argued two former Health and Human Services officials writing for the conservative Federalist Society.

They are also supported by two former Justice Department attorneys working under previous Republican presidents, who wrote a piece for The Wall Street Journal earlier this year.

David Rivkin and Lee Casey say calling the penalty for not buying insurance a "tax" is a distortion of the word for the sole purpose of trying to shoehorn the policy into safe legal ground.

"A 'tax' that falls exclusively on anyone who is uninsured is a penalty beyond Congress's authority," they wrote. "If the rule were otherwise, Congress could evade all constitutional limits by 'taxing' anyone who doesn't follow an order of any kind -- whether to obtain health care insurance, or to join a health club, or exercise regularly, or even eat your vegetables."

mcanham@sltrib.com" Target="_BLANK">mcanham@sltrib.com

Arguments rage as Senate bill passes procedural vote.
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