How Do the States Have Standing to Challenge an Unenforced and Unenforceable Mandate?

There is no longer any legal or financial consequence for failing to comply with the individual mandate, so how are states (or anyone else) harmed by it?

|The Volokh Conspiracy |

In a prior post (and an amicus brief) I have explained why I think the Justice Department's partial embrace of the states' severability arguments is completely wrong-headed. Yet this is not the only problem with the Justice Department brief. Another is the federal government's failure to challenge the states' legal standing to bring this suit in the first place.

DOJ's failure to contest the states' standing in the latest ACA case is notable for several reasons. First, it is quite rare for the federal government to not invoke justiciability concerns in defense of federal law. For decades, under both Republican and Democratic administrations, the Justice Department has maintained a particularly stingy view of Article III, raising questions about plaintiffs' standing as a matter of course. If there is any reason to question standing, DOJ would—but not here.

Second, the argument the states have standing to challenge the constitutionality of penalty-less mandate is exceedingly weak. Under current doctrine, in order to show standing the plaintiff must have suffered a concrete and particularized injury-in-fact that is fairly traceable to the challenged action. Here the states are complaining that the mandate is unconstitutional because it is not enforced with a tax penalty. Indeed, the mandate is not enforced at all, which it makes it hard to understand how the states can claim an injury from a statutory provision that has no legal or financial consequence. The same goes for the private plaintiffs that have joined the states' case.

In their brief, the states claim the ACA is "forcing" states and individuals to comply with the individual mandate and that it "requires" individuals to obtain qualifying health coverage. Neither claim is true. As Chief Justice Roberts explained in NFIB, the "only consequence" of failing to obtain qualifying health insurance under the ACA as enacted was paying a tax. "Neither the Act nor any other law attaches negative legal consequences to not buying health insurance, beyond requiring a payment to the IRS," Roberts wrote. Now that tax is set at zero, so no one is required to do anything at all. The law may say "Do X," but there is no consequence for a failure to comply.

Insofar as the states and their co-plaintiffs can claim to be injured, it is not due to the unenforced and unenforceable mandate but due to other provisions, such as the employer mandate or the Medicaid provisions. This doesn't cut it. As the Supreme Court explained in Lujan v. Defenders of Wildlife, "there must be a causal connection between the injury and the conduct complained of–the injury has to be "fairly … trace[able] to the challenged action of the defendant." The "challenged action" here is the zero-penalty mandate, not any of the other ACA provisions that actually impact states or anyone else.

The states try to get around this by pointing to the alleged inseverability of the rest of the ACA, but that doesn't work either (for reasons Kevin Walsh pointed out in this Stanford Law Review article at pp. 75-77). As the Court explained in Davis v. Federal Election Commission "a plaintiff must demonstrate standing for each claim he seeks to press and for each form of relief that is sought." Claiming inseverability is no way around this limitation. Were it otherwise, the requirements of Article III standing would be rendered toothless. As the Court noted in Lewis v. Casey, "the actual injury requirement would hardly serve the purpose . . . of preventing courts from undertaking tasks assigned to the political branches[,] if once a plaintiff demonstrated harm from one particular inadequacy in government administration, the court were authorized to remedy all inadequacies in that administration." Yet that is precisely what the plaintiffs here are trying to do.

As I explained in my prior post (and amicus brief), the plaintiffs are not entitled to the relief they seek. Even more fundamentally, they are not entitled to have federal courts hear their claims in the first place because they have no standing to raise their claims. As much as I might like to support a serious legal challenge to various aspects of the ACA, the proper course here is for the district court to dismiss the case.

UPDATE: A small technical point. As some readers have pointed out, the repeal of the individual mandate penalty is actually effective January 1, 2019. This is when the states claim that the mandate becomes unconstitutional, and this is the point at which one must assess their claimed injury.

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20 responses to “How Do the States Have Standing to Challenge an Unenforced and Unenforceable Mandate?

  1. Maybe I’m missing something. If the invalidity of the mandate means that other parts of the Act are invalid because of inseverability, then anyone adversely affected by those other parts of the Act would have standing, wouldn’t he/she/it? Isn’t the real real response with the States’ suit that the other parts of the Act are NOT inseverable in a legal sense, even though as a practical matter the Act may not function as intended without the mandate?

    1. Yeah, I think you missed the sixth paragraph:

      As the Court explained in Davis v. Federal Election Commission “a plaintiff must demonstrate standing for each claim he seeks to press and for each form of relief that is sought.” Claiming inseverability is no way around this limitation. Were it otherwise, the requirements of Article III standing would be rendered toothless. As the Court noted in Lewis v. Casey, “the actual injury requirement would hardly serve the purpose . . . of preventing courts from undertaking tasks assigned to the political branches[,] if once a plaintiff demonstrated harm from one particular inadequacy in government administration, the court were authorized to remedy all inadequacies in that administration.” Yet that is precisely what the plaintiffs here are trying to do.

  2. Are the insurers still required to provide coverage to anyone who applies? By shrinking the risk pool and per Federal Circuit ruling, they’re being harmed.

    Are the insures still required to only provide coverage that meets certain arbitrary high requirements? Then the citizens are being harmed by not being able to purchase more tailored and significantly cheaper plans.

    1. Kushner’s brother started a health insurance company to serve the Obamacare Exchanges and it has been expanding…make of that what you will.

    2. But they’re not alleging that the requirement to provide coverage is unconstitutional. They certainly would have standing to challenge that provision, the question is whether they have standing to challenge a different provision.

  3. People who are negatively affected by the mandate don’t need relief from courts, because there is no penalty they can simply declare the mandate unconstitutional themselves and decline to purchase insurance.

    However, Congress said, “Well, we’re going to impose burdens like guaranteed issue and minimum coverage, but we’re going to offset the burden by requiring folks to buy insurance.”

    The plaintiffs are being harmed by having these related requirements enforced when Congress can’t constitutionally require people to buy insurance to offset the costs.

    It’s like Congress passed a law requiring people to jump off a ledge, and requiring states to place a safety net below. People who have to jump off the ledge would surely have standing to claim that Congress couldn’t require states to build the safety net.

  4. My Employer provided Health Care choices are dramatically higher in cost because of the ACA. I can not refuse coverage without an equivalent Plan from elsewhere. I am being harmed. On the plus side, as a 56 year old Male, I can get free contraceptive pills and maternity care.

    1. I was mostly in the individual market prior to Obamacare and every year my health insurance got more expensive. Because age is such a huge factor in health insurance it makes perfect sense that health insurance would get more expensive until one qualifies for Medicare.

  5. The ACA relies upon an honor system to secure obedience to the mandate. Therefore, people with honor who buy insurance against their better judgment are thereby harmed. In contrast, people without honor are not harmed, because they just ignore the mandate. So the mandate does harm honorable people. And not incidentally, the ACA thereby discriminates against honorable people.

    Many laws include penalties for violating the law that are less than the benefits accrued from violating the law. An extreme hypothetical example is a law saying that anyone who commits the crime of stealing money from a blogger may keep the money except for a 10% penalty. That’s no financial disincentive to committing the crime, just like the individual mandate is accompanied by no financial disincentive for failing to buy health insurance, and yet it must be acknowledged that the thief who steals from a blogger would obviously have standing to challenge that law. So why wouldn’t a person subject to the mandate have standing too?

    1. Longstanding federal standing law requires more than harm to ones honor. For example, government is not liable for defamation. Further, the idea that following hortatory government statements is honorable and not following them is dishonorable has not generally been accepted by the case. In Doe v. Dooley, a challenge to Virginia’s fornication statutes, the 4th Circuit explained the nonjusticiability of unenforced laws by saying that without enforcement, the statutes represented mere artwork, a mere decoration of the statute books, and courts don’t judge legislatures’ tastes in decoration.

      There is nothing dishonorable about disagreeing with the legislature’s tastes in decoration either.

      1. I think the 4th circuit case was doe v. duling, not doe v. dooley. Anyway, I would be more persuaded by a case involving financial harm. Once a person forks over money, per a federal command to do so, for a product he does not want, that seems like a real and tangible financial harm.

        1. Andrew Hyman, I hereby command you to give me $1000 in exchange for five pages of my thoughts.

          There. I’ve done it. You surely don’t want the five pages of my thoughts. And assuming you also don’t want to give me $1000, there’s a very simple way to test your theory. Give me the $1000, take the five pages, and then sue me on grounds that my command caused you to fork over money against your will for a product you didn’t want, and this hurt you.

          And let’s see if the courts rule in your favor.

          1. Not relevant, because (1) no federal law is involved, and (2) I am law-abiding rather than ReaderY-abiding.

    2. If a (penalty-less) law mandated that you do something that you think harms others, would you be honor-bound to obey? I think not. You probably feel honor-bound to buy insurance when you’re healthy because you agree that this supports affordable insurance for the sick. And that’s great, but it’s not the ACA mandate that’s costing you, it’s your own agreement with the reasons behind the mandate.

      “”HIGGINS. Have you no morals, man?
      DOOLITTLE [unabashed] Cant afford them, Governor. Neither could you if you was as poor as me.”

  6. Agreed.

    What’s going on here is a classic example of ceremonial legalism – treating law as a sort of high aristocratic culture, and using phrases, formalities, and ceremonies from high legal culture in order to communicate ones aristocratic status, and hence the propriety of what one has decided to do, to the unwashed masses – of a sort we have often seen coming from the left.

  7. In Alaska Air v Brock, Alaska Air challenged the Airline Deregulation Act. They were injured by something called the Employee Protection Program, but they claimed that a legislative veto provision (that didn’t injure them) was unconstitutional, and non-severable. The Supreme Court reached the merits and found that the legislative veto provision was severable. But because Article III standing is a threshhold issue of jurisdiction, reaching the merits shows that Alaska Air had standing.

  8. Many states as well as the federal government require various paths that include obedience to federal statutes. They may be called oaths or allegiance, loyalty oaths, citizenship oaths, et cetera. These oaths may be taken by public school teachers as a condition of employment, or by immigrants as a condition of citizenship, and I assume in many cases that violating these oaths can have adverse legal consequences, such as loss of employment or perhaps even loss of citizenship ?- any of which would obviously confer standing as to the individual mandate.

    1. paths >> oaths

    2. The current law says you may either buy insurance OR pay $0 to the IRS. The law never said that one course of action is more “honorable” than the other. If you feel oath-bound to obey every law to the letter, you may write a $0 check to the IRS (or add $0 to your taxes), and your duty will be done.

  9. Which is exactly why the concept of standing needs to be discarded. Courts all too often use it to get out of doing their jobs, just like you are encouraging them to do now.

    I’m happy the government is not challenging standing. Let’s hope is the start of the death of standing.

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