If ObamaCare's Individual Mandate Goes, Then What?


As I noted yesterday, the authors of the recent health care overhaul legislation failed to include a severability clause in the text of the law. A severability clause is inserted into legislation in order to protect the bulk of the law should one provision be deemed unconstitutional. But as because the PPACA has no severability clause, a court—at least in theory—could take down the entire law if it decided that the mandate was unconstitutional.

As TPM's Brian Beutler notes, history suggests that in practice the Supreme Court may not be willing to take such action. When the Court ruled that the rules governing the Public Company Accounting Oversight Board set up by the Sarbanes Oxley accounting legislation was unconstitutional, it left the rest of the law in place—despite the lack of a severability clause. As Avik Roy explained earlier this year, the ruling in that case suggests that the Court "presumes severability unless non-severability is explicitly specified."

Yet it's worth noting that the Sarbanes Oxley case provides no explicit guarantee that a court wouldn't take down the entire health care law. And even if a court chose to let parts of the law stand, a ruling that the mandate is unconstitutional would likely mean that large portions of the law—those portions deemed sufficiently intertwined with or reliant upon the mandate—go down with it.

According to The Cato Institute's Ilya Shapiro, "the PCAOB [Sarbanes Oxley] case isn't any sort of legal precedent." So although it's suggestive of the way the court thinks about these issues, a court wouldn't necessarily have to follow its example. If a court decided to strike down the whole law, it could.

And even if it failed to take out the whole thing, major parts of law would surely go if the mandate is deemed unconstitutional. Shapiro explains that "if one provision of a large bill falls and there's no severability clause, then the court in effect goes into legislators' minds and tries to see what they wouldn't have passed without that provision being part of the package." Any parts that are too closely linked would be trimmed.

What might that include? The new regulations requiring insurance companies to sell to anyone regardless of preexisting conditions would be tops on the list, because the primary purpose of the mandate is to mitigate their negative effects. Indeed, the government has virtually assured that these provisions would be killed if there was a ruling against the mandate: A major part of the government's legal argument for the mandate is that the other provisions won't work without the requirement.

There would also be a strong argument that the generous insurance subsidies should go too; those subsidies were included largely to address an issue created by the mandate—what to do about those who cannot afford to buy insurance.

The provisions most likely to stand, I suspect, would be the Medicaid expansion and the creation of the health insurance exchanges, both of which could conceivably have been passed in the absence of the mandate. But even those aren't necessarily safe.

That's because there's also a strong argument that the entire law would have not have been passed without the mandate. As Shapiro tells me, passing the bill involved "a whole bunch of logrolling and finely balanced compromises." It was a package deal designed to attract maximum political support on what was sure to be a tough, politically dicey vote. So although some of the law's provisions are less explicitly dependent on the mandate, it's hard to imagine that Congress would have passed the other parts in its absence. In many ways, then, the law's passage was all or nothing. Hopefully, the Supreme Court will both rule that the mandate is unconstitutional and agree that none of the law would have passed without it.