Appellate Conflict on Obamacare Sets the Table for Supreme Court

Aug 21, 2011
David J. Shestokas

Seal of the Eleventh Circuit - US Courts

As health care reform works its way through the courts, a Supreme Court hearing is now assured as two appellate courts have issued conflicting opinions.

The United States Supreme Court is unique among the federal courts in that in most situations it can pick and choose what cases it will hear. Only in very limited cases must it take a case (these are cases of original jurisdiction). When a party appeals a case to the Supreme Court, a petition for a writ of certiorari is filed with the court. The justices of the court then vote among themselves whether they will hear the case, or deny the petition. A denial of the petition has the effect of letting the decision of the lower court stand.

Granting a petition for a writ of certiorari means the Court will hear and decide a case. This decision is entirely at the Court’s discretion. By rule of the Court, if four of the nine justices vote to hear a case, then it is accepted.

A Conflict Between Courts of Appeals is A Factor for Supreme Court Hearing

While the conventional wisdom has always been that the Supreme Court would have the final word on the constitutionality of the Affordable Care Act (ACA), often referred to as “Obamacare”, it was not necessarily certain. Among the factors weighed by the justices in deciding to take whether to accept a case is the state of the law as decided by the lower courts.

If the Courts of Appeals that have ruled on a subject have all agreed, then the law is settled, and unless the Supreme Court feels all the lower courts are wrong, the Court is not likely to take the case. When the circuit courts have disagreed, then something called a “conflict in the circuits” exists. That means the law is different in different parts of the country. In that situation, the Supreme Court will normally take a case to resolve the conflict and provide the final word on a subject.

The central question regarding Obamacare’s constitutionality has been the imposition of the “individual mandate”. The individual mandate imposes a penalty on certain citizens who choose not to purchase government approved health insurance. On June 29, 2011, the 6th Circuit Court of Appeals ruled that the individual mandate of the ACA was constitutional. On August 12, 2011, the 11th Circuit Court of Appeals ruled the mandate was unconstitutional in the largest Obamacare case, involving 26 states. The 11th Circuit ruling created a conflict in the circuits, which the Supreme Court will now have to resolve.

A Common Element of the Two Opinions

On some very important issues regarding Obamacare the two circuits did agree. The Obama administration had argued in both courts that Congress had the power under its taxing authority to impose the individual mandate. In fact, the penalty imposed for failing to comply with the mandate is in the Internal Revenue Code, giving it the appearance of a tax. Both circuit courts (and all the district courts that have given opinions on the subject) agreed that regardless of the efforts of Congress to have the penalty seem to be a tax, it was not a tax. Therefore, Congress could not look to its taxing power to impose the individual mandate.

Two Different Readings of the Commerce Clause Sets Up Conflict

Both courts determined that the issue regarding the individual mandate was whether Congress had the authority under the Constitution’s Commerce Clause to require a citizen of the United States to purchase the services of a private company or suffer a penalty for failing to do so. The Sixth Circuit said yes and the Eleventh Circuit said no. The end result is a conflict, which now places the question squarely before the Supreme Court.