Modern Healthcare, By Joe Carlson –
March 26, 2012: With crowds of demonstrators outside the Supreme Court on Monday, the nine justices inside grilled three attorneys over whether an 1867 federal law prohibits courts from hearing challenges to the new federal requirement that nearly all Americans purchase health insurance.
The justices leveled hard-nosed questions about the substance and intent of the 19th-century law—known as the Anti-injunction Act, and whether it ought to deny them jurisdiction to hear challenges to the insurance mandate in the Patient Protection and Affordable Care Act.
Monday’s 90-minute session marked the first of three days of arguments about the law. “This case presents questions of great moment, and the Anti-injunction Act does not bar the courts from hearing from,” U.S. Solicitor General Donald Verrilli Jr. said in an opening remark before a room of observers pressed shoulder-to-shoulder in the courtroom.
Though the discussion frequently delved into granular discussions of federal statutes and court precedents, Verrilli urged justices to find, at base, that Congress did not intend the penalty for failure to buy health insurance in 2014 as a tax, even though the penalty is enforced through the procedures in the tax collection laws.
With certain narrow exceptions, the Anti-injunction Act bars any lawsuit in any court from interfering with the collection of a tax before the amount is paid or a formal collection action has begun.
“The AIA imposes a pay-first, litigate-later rule that is central to tax collection,” said attorney Robert Long, who was appointed by the justices to argue in favor of the idea that the law should bar them from hearing the case until penalties are assessed sometime after 2014.
However, Long faced among the toughest questions from the justices, despite his appointment. At one point, Justice Sonia Sotomayor, asked what “parade of horribles” would follow if the court decided it could hear the case now.
Long replied there was the risk that litigants and federal judges may see such a decision as an opening to consider granting other waivers to the Anti-injunction Act in other cases—a prediction also made in an amicus brief filed by commissioners of the Internal Revenue Service.
Following Long’s response, Justice Antonin Scalia concluded sarcastically, “So there will be no parade of horrors because all federal judges are intelligent.” The remark drew laughter from the crowd.
Also addressing Long, Justice Stephen Breyer said that neither the text of the act nor the way that it was codified in the federal statutes appeared to support a decision to wait until 2014. “Congress here has nowhere used the word tax,” Breyer said.
Justice Ruth Bader Ginsburg asked whether the argument missed the point of the lawsuit, which doesn’t actually challenge the penalty regardless of whether it’s found to be a tax. “This suit is not challenging the penalty,” Ginsburg said. “This suit is challenging the must-buy requirement. If the requirement is upheld, (the citizens suing over the mandate) will not contest the penalty.”
In questioning Long, Scalia made clear his feeling about whether the court should hear the case: “Unless it’s clear, the courts are not deprived of jurisdiction. Whatever else this is, I find it hard to believe that this is clear.”