The Senate Bill: Abortion And The Individual Mandate’s Constitutionality
November 20th, 2009
 by
Timothy Jost
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Editor’s Note: In the post below, Tim Jost looks at how the Senate Democratic health reform bill treats abortion coverage, and also at the question of the individual mandate’s constitutionality. In earlier posts, Jost took a first look at the Senate legislation and provided a detailed look at several issues that arise under the bill’s insurance reforms. In a later post, Jost looks at the bill’s provisions on Medicare and other topics.
Abortion. Early drafts of the health reform legislation attempted to ignore the issue of abortion, but in American politics, abortion is an issue that refuses to be ignored. The problem is that current federal law only permits public funding for abortions involving rape, incest, or physical endangerment to the life of the mother. Many private plans, however–perhaps most—cover all medically necessary abortion.
Once federal premium subsidies are made available to purchase private insurance, therefore, the problem becomes whether to ban subsidies for any plan that covers abortion, thus significantly reducing private coverage for abortion, or to try to segregate in some way the premium subsidies, allowing private plans to still cover abortion but only with private funds. The Capps Amendment, adopted by the House Energy and Commerce Committee tried the second approach. The full House adopted instead the Stupak Amendment, which adopted the former approach. The Senate bill is closer to the Capps Amendment.
The Senate bill first makes clear that it does not does not change or preempt any current state or federal laws pertaining to abortion, including conscience protections. It explicitly also prohibits discrimination against a provider or facility on the basis of its willingness or unwillingness, for reasons of conscience, to provide, pay for, provide coverage for, or refer for abortion. Second, the bill prohibits HHS from requiring the coverage of abortion as an essential health service (even abortions for rape, incest, or physical life endangerment).
Third, the bill would mandate that the public option only cover abortions that are not otherwise federally-funded if HHS can certify under GAAP and GAO and OMB standards that federal funds are not being used and that the federal government is not at risk for the coverage. Since the public option can only cover essential benefits unless additional benefits are required by state law, abortion could only be covered by the public option if a state required it.
The bill further provides, however, that if a state requires abortion coverage through the public option, it must assure that “no funds flowing through or from” the public option can be used to pay for abortion, so the state would have to provide abortion coverage as a supplemental benefit. The state would also have to pay for the abortion benefit for any public option member who received premium subsidies, because states can only require non-essential services to be covered by the public option for people who receive premium subsidies if the state pays for the additional benefits. It is conceivable that a state would pay for abortions in the public option—seventeen states now fund medically-necessary abortions through Medicaid with state funds—but as the public option would not serve a predominantly poor population, state funding is unlikely.
The bill also prohibits public premium affordability or cost-sharing credits from being used to cover abortions through private plans purchased through the exchanges. HHS must calculate the cost of abortion coverage for each plan, not taking into account the cost savings to the plan of paying for an abortion rather than a childbirth, and segregate the cost of abortion coverage. This amount must be paid for separately by the insured. This is essentially the same language as was used in the Capps amendment, and is encountering the same objections that it is insufficient to assure that federal funds are not in fact used to pay for abortion. Opponents will undoubtedly seek to amend the bill.
The legislation requires each exchange to provide access to at least one plan that covers non-federally funded abortions and one that does not to assure choice. This provision was in the House bill but was eliminated by Stupak. Provisions later in the bill (which are also found in the House bill) fund a longitudinal study of the mental health effects of having an abortion as compared to other means of “resolving a pregnancy” and ban abortion coverage in the school-based health center program.
The Constitutionality of the Individual Mandate. Under our constitutional system, the federal government is limited to the “enumerated” power provided to it by the Constitution. These include the power to regulate interstate commerce and to tax and spend for the public welfare. Both of these powers have been given very broad scope by the Supreme Court, whose most recent extended consideration of the Commerce Clause upheld the power of the federal government to sanction an individual who grew marijuana for personal medical use. There is virtually no limit to the federal government’s power to regulate economic activity. In particular, its authority to regulate insurance was recognized by the Supreme Court over sixty years ago and is beyond serious challenge.
The question has been seriously raised, however, of whether requiring individuals to purchase health insurance is regulation of commerce. (See, for example, September 15th and 18th opinion pieces in the Wall Street Journal. The argument is that, while Congress can regulate goods and services in the stream of commerce, it cannot compel individuals to initiate commercial transactions, or at least it never has before. In part this is an argument about what the Constitution really means, as opposed to what the Supreme Court says that it means, with some constitutional scholars arguing that the Court has gone too far in allowing Congress to interfere in matters that should be left to the states or left alone entirely.
But even some commentators who believe that what matters is ultimately what the Supreme Court says the Constitution means (and believe me, this is what ultimately matters in reality) question whether the Supreme Court would uphold the individual mandate. Indeed, the Supreme Court has in a couple of cases in recent years held that the commerce power is not unlimited—that it only extends to the regulation of economic activity and that some private conduct is not economic in nature.
It is for this reason that the Senate bill prefaces the individual mandate with almost four pages of findings, essentially a brief to the Court as to why the mandate is in fact intended to regulate economic activity, and is thus constitutional. The findings note that:
- The mandate regulates “economic and financial decisions about how and when health care is paid for, and when health insurance is purchased.”
- Health insurance and health care are a significant part of the national economy and are sold in interstate commerce.
- The mandate will “add millions of new consumers to the health insurance market, increasing the supply of, and demand for, health care services;” strengthen our employer-based health insurance system; and improve the financial security of American families
- Increasing the size of the risk pool is necessary to fully exploit economies of scale and thus reduce administrative costs in the individual and small group markets; and
- Most importantly, since the law now prohibits pre-existing conditions clauses and health status underwriting, without the provision many people would wait until they were in fact sick or injured to purchase health insurance. The provision is necessary, therefore, to prevent adverse selection and to assure a viable risk pool.
This is an issue that some people are passionate about and the legislation will undoubtedly be challenged. The Supreme Court’s most recent case mentioning the Commerce Clause, however, was the partial birth abortion case, in which the Court recognized the power of Congress to regulate medical practice. If Congress can regulate medical procedures, it would seem that it could regulate the timing of the purchase of insurance. In fact, I believe that there are only one or two members of the Supreme Court that would clearly reject this proposition. Time will tell, but the Senate is taking no chances.
For more on this topic, see this post and this response on the blog of Georgetown University’s O’Neill Institute for National and Global Health Law, as well as this Politico article.