Medicaid in trouble?

A report from SCOTUSblog's Lyle Denniston:

Unless a closing oration by the government’s top lawyer stirs some real sympathy for the poor, the new health care law’s broad expansion of the Medicaid program that serves the needy may be sacrificed to a historic expression of judicial sympathy for states’ rights. It probably would require the Court to be really bold, to strike down a program passed by Congress under its spending power, and to do so for the first time in 76 years, but the temptation was very much in evidence in the final round of the Court’s hearings this week on the Affordable Care Act. It probably would be done by a 5-4 vote. 

Solicitor General Donald B. Verrilli, Jr., and his principal adversary this week, Washington attorney Paul D. Clement, took turns as the final minutes of the third day of argument wound down to make a plea to the Court to think more broadly about their coming decision on not only the Medicaid expansion, but on another key piece of the ACA: the individual insurance mandate that the Court had explored on Tuesday. Verrilli edged toward the emotional, while Clement was crisp and blunt in making a final plea for the Court to sweep away all of the new law. They stepped back as the Court left the bench, to start the task — far from easy — or sorting through four profound legal or constitutional issues they had heard since Monday.

Color me fairly surprised, yet again.

Medicaid argument audio available

Here.

The arguments are now over

All six hours and twenty minutes.

The next step in the process is that the justices will meet in conference (by themselves, with no one else in the room) Friday morning. They will discuss and vote on the respective questions presented, in order of seniority. These votes are not binding; no votes are official until the decision is handed down publicly. But they give the Court a working count with which to assign and write opinions. (Votes do change after conference, but it is certainly the exception and not the rule.)

The audio and transcript should be up on the Court's site within the next hour. More coming soon.

Another update on the Medicaid argument

Courtesy of Tom Goldstein:

Paul Clement is concluding his rebuttal now. In the second half of the argument there were more voices, including Justice Alito, for the idea that the Medicaid expansion is coercive but it did not seem at all a likely outcome. The questions were too abstract about general principles. One very plausible middle ground outcome would be to say that there are some limits on the federal government’s ability to revoke all Medicaid funds in response to a state’s decision just to refuse the expansion. What those limits are would be left for another case. But I don't see the Court going further than that. The Chief repeatedly suggested that maybe the states gave up this aspect of the sovereignty by accepting federal funds. The SG closed with an argument that the health care statute as a whole including the mandate was essential to the public receiving the “blessings of liberty” because health care is so important. All the usual caveats apply about how you can't be sure from an argument.

Medicaid argument going long

The justices have given the attorneys some extra time, and the argument should be concluding right about now.

Some tough questioning of the SG from the conservatives, but early reports seem to indicate that the Medicaid expansion is reasonably safe. Here are two reports from Tom Goldstein of SCOTUSblog:

Paul Clement is done with his 30 minutes. The left is all over him for his argument against the expansion, but that is no surprise. The right was not critical but it’s too early to tell if there is actual support. That’s next. 

6 hours wasn’t enough. The Court has added roughly 20 minutes to the Medicaid argument by keeping Clement up for an extra 10. So far in the SG’s argument, significant pressure from the conservatives to acknowledge some line beyond which threats to funding are coercive. But no strong questions that this particular extension goes too far. So far, it looks safe.

Transcript up

Here.

Audio of severability argument available

Here.

Severability problems bending back to bolster the the minimum coverage provision?

Every so often, courts will choose a second-best outcome to a case, not because they think it is a great resolution to the matter, but because it allows them to avoid an even more difficult legal question. Lyle Denniston of SCOTUSblog is now reporting that the complications concerning the severability issue might have just that sort of effect here, and marginally push the Court (or at least Justice Kennedy) in the direction of upholding the individual mandate. Here is what Denniston writes, after just stepping outside the Court:

The Supreme Court spent 91 minutes Wednesday operating on the assumption that it would strike down the key feature of the new health care law, but may have convinced itself in the end not to do that because of just how hard it would be to decide what to do after that.  A common reaction, across the bench, was that the Justices themselves did not want the onerous task of going through the remainder of the entire 2,700 pages of the law and deciding what to keep and what to throw out, and most seemed to think that should be left to Congress.  They did not come together, however, on just what task they would send across the street for the lawmakers to perform.  The net effect may well have shored up support for the individual insurance mandate itself. 

Severability argument is over

Folks are filing out of the building, and the justices are now in a lunch break until 1:00 EDT. At that point, the Court will reconvene for the Medicaid arguments.

Alito and Scalia appearing to endorse taking down the entire Act

This from the Bloomberg live blog:

Conservative justices Antonin Scalia and Samuel Alito have seemed to endorse Mr. Clement’s case. Justice Scalia has been responding frequently to Justice Sotomayor’s remarks, pointing to what he calls “legislative inertia” as a reason not to leave the decision of how much of the law to keep to Congress. Justice Alito, meanwhile, has argued that if the judges are considering what Congress intended when it passed the legislation, they should probably consider that the legislation wouldn’t have passed without its cornerstone provision, the individual mandate.

My old boss used to say occasionally, in response to being informed about one of her colleagues' more extreme views, "We are not going to do that." And that is what I have been telling everyone for the last two years--that the Court is not going to take down the entire ACA. But perhaps, just perhaps, they will in fact do that.

To borrow Justice Scalia's words from yesterday, "Extraordinary."

A muddled picture thus far

The early reports of argument suggest that the Court is sort of all over the place on the matter of severability. Paul Clement received lots of skeptical questioning, across the ideological spectrum, for his contention that the entire ACA should be void if the minimum coverage provision is unconstitutional. But Ed Kneedler is getting tough questioning as well; the conservative justices wonder how exactly they are to determine which of the hundreds of provisions should stay and go. Reports are indicating, though, that there seems to be a consensus (with the possible exception of Sotomayor) that the guarantee-issue and community-rating provisions must fall if the minimum coverage provision go down.

The fact that the Court is this engaged on severability cannot be a good sign for the Government as to the constitutionality of the individual mandate.

SCOTUSblog has updates here and here.

We start again in 5 minutes

First, we will have 90 minutes on severability. Then we will have 60 minutes on the Medicaid question. Unlike the last two days, the challengers are up first, as they are the petitioners. Paul Clement will argue both questions for them. Deputy SG Ed Kneedler will argue the severability question for the United States, while SG Don Verrilli gets the Medicaid question. Court-appointed amicus H. Bartow Farr will argue on the severability question in defense of the Eleventh Circuit's decision, which found the minimum coverage provision completely severable.

Another big day tomorrow

It will not be easy for the Solicitor General to take to the podium again tomorrow.

Not because he did not do a great job today. Despite some opinions I've seen expressed (by Jeffrey Toobin and the like), I thought general Verrilli was about as effective as he could have been under the circumstances.

Rather, tomorrow will be hard just because today had to have been pretty deflating. The Court was obviously quite hostile to the minimum coverage provision--more hostile than most reasonable people could have expected. In particular, the Chief Justice seems nearly a sure vote to strike it down, and Kennedy, though more equivocal, clearly suggested he was leaning in that direction as well. The votes of Scalia and Alito (not to mention Thomas) are abundantly clear.

But General Verrilli (and Deputy SG Ed Kneedler) need to re-group and bring their A games again Wednesday. This is not just because the Medicaid question is terrifically important in its own right (though it surely is that). It is also because the severability question (and the Medicaid question too, to some extent) could give the Government another opportunity to make its case for the mandate. The window might be small, but it surely will present itself at some point. It is difficult to have such a lengthy conversation about the severability of a provision without ever glancing at whether (and why) that provision might (or might not be) unconstitutional in the first place.

So tomorrow could be important in several ways. It could tell us more about the justices' views. And it could give the Government a chance or two to reach Justice Kennedy. So setting aside the merits of the last two questions presented, there is plenty to play for.

On the merits, I still have a hard time seeing this Court invalidating the ACA's Medicaid expansion provisions. All of the slippery-slope lack-of-a-limiting-principle problems that bedeviled the Government today are going to plague the states and Mr. Clement tomorrow. No doubt, the states' argument has some rhetorical force: it does seem that the states have no practical choice. But once one starts peeling the skin of that onion, much of the modern, post-New Deal state starts to unravel. Indeed, if the ACA's Medicaid expansion provisions are unconstitutional, it is hard to see how the entire Medicaid program (and several other major federal programs) has not been unconstitutional for many, many years.

But I was a bit surprised today by the level of the Court's hostility to the minimum coverage provision. Which means I could well be just as surprised tomorrow -- or in June.

Assessing the advocates

I have now listened to the argument twice and read through the transcript, and here are some quick impressions of the advocates:

* Paul Clement, as usual, was superb. In a sense, though, he had an easier hand. From the beginning, the challengers have been considered underdogs; he had the advantage of watching and listening to the justices for an entire hour before stepping to the lectern; and, well, the questioning he faced was decidedly less hostile. Still, a terrific performance--one of many he has turned in.

* The Solicitor General, Don Verrilli, was, in my view, also terrific, if a bit understated by comparison. One has to realize that the role of the Solicitor General is quite different, and he is not nearly as free as a private attorney to reach for rhetorical heights. Further, the weight of expectations in this case no doubt weighed heavily on the Government. Moreover, it had to be a bit deflating to hear such hostile questions from the get-go--particularly from both the Chief Justice and Justice Kennedy. Still, he was always quite measured and gave subtle, sophisticated answers (regardless of whether you agree with them) that put the Government's position in the best light possible. This is particularly evident in reading the transcript, moreso than in my first time listening to the recording. All in all, a terrific piece of advocacy, especially considering the circumstances.

* Michael Carvin, representing the private plaintiffs, is apt to be a bit polarizing. I thought he was certainly effective in places, but he also seemed to wander a bit, straying from those points on which the individual mandate is most vulnerable. It is hard to assess his argument objectively, though, because he was bailed out by some terrifically unstrategic questioning by Justices Breyer and Sotomayor, who seemed to serve up issues for him on a platter. It was precisely the reverse of what happened to the Solicitor General. While the conservative justices, to some degree, dug in hard with effective, hostile questions of Verrilli, the liberal justices' questions to Carvin only seemed to strengthen his arguments--or at least make them more attractive to the center of the Court.

Again, just some quick impressions. And all of this is probably beside the point. I do not think any of us would really want the constitutionality of the ACA--or the scope of Congress's enumerated powers--actually to turn on who happened to argue the respective sides. In cases like this, the oral argument, while revealing to the listener, is hardly ever relevant to the justices' decisions.

Reading the Kennedy tea leaves

It is no doubt true that during the Solicitor General's turn at the dais, Justice Kennedy asked a number of questions suggesting he was quite skeptical of the minimum coverage provision's constitutionality. Perhaps most tellingly, he commented that he thought the provision "changes the relationship between the Federal Government and the individual in a fundamental way," and thus requires "a heavy burden of justification."

But there were some glimmers of hope for the Government from Kennedy in the second half of the argument. Let me point out three specific exchanges, which will likely be analyzed and re-analyzed thousands of times between now and the end of June.

First, consider this question that Kennedy asked Paul Clement, at pp. 56-57 of the transcript:

Is the government's argument this--and maybe I won't state it accurately. It is true that the noninsured young adult is, in fact, an actuarial reality insofar as our allocation of health services, insofar as the way health insurance companies figure risks. That person who is sitting at home in his or her living room doing nothing is an actuarial reality that can and must be measured for health service purposes; is that their argument?

This hints at, perhaps, some sympathy with the notion that Congress must regulate this group--must force them into the insurance market--because their "actuarial reality" is necessarily having a substantial impact on interstate commerce, and in a market in which those people do generally participate--that for health care services.

Second, consider this exchange with Clement, on p.70 of the transcript:

MR. CLEMENT: And with respect to the health insurance market that's designed to have payment in the health care market, everybody is not in the market. And that's the premise of the statute, and that's the problem Congress is trying to solve. 

And if it tried to solve it through incentives, we wouldn't be here; but, it's trying to solve it in a way that nobody has ever tried to solve an economic problem before, which is saying, you know, it would be so much more efficient if you were just in this market-- 

JUSTICE KENNEDY: But they are in the market in the sense that they are creating a risk that the market must account for. 

MR. CLEMENT: Well, Justice Kennedy, I don't think that's right, certainly in any way that distinguishes this from any other context. . . . 

Again, Kennedy is here revealing at least some sympathy for the notion that the practice of not acquiring health insurance is having a very real and substantial impact on the health care market. This practice of "self-insuring," if you will, is ensuring the existence of uncompensated care, which has a very real and immediate impact on the current pricing of health insurance premiums (and the price of health care services).

Finally, consider this exchange with Michael Carvin on p. 104 of the transcript:

MR. CARVIN: It is clear that the failure to buy health insurance doesn't affect anyone. Defaulting on your payments to your health care provider does. Congress chose, for whatever reason, not to regulate the harmful activity of defaulting on your health care provider. They used the 20 percent or whoever among the uninsured as a leverage to regulate the 100 percent of the uninsured. 

JUSTICE KENNEDY: I agree--I agree that that's what's happening here. 

MR. CARVIN: Okay. 

JUSTICE KENNEDY: And the government tells us that's because the insurance market is unique. And in the next case, it'll say the next market is unique. But I think it is true that if most questions in life are matters of degree, in the insurance and health care world, both markets--stipulate two markets--the young person who is uninsured is uniquely proximately very close to affecting the rates of insurance and the costs of providing medical care in a way that is not true in other industries. 

That's my concern in the case. 

This is probably the most telling passage. It certainly does not indicate that Kennedy is convinced by the Government's argument for constitutionality. But Kennedy has at least expressed a "concern" with the challengers' position--not to mention an admission that this case is not black-and-white, falling into a clear and distinct categorical prohibition. A willingness to tolerate some gray is certainly to the Government's advantage.

Again, taking the argument as a whole, one has to be left with the impression that Kennedy was leaning against upholding the individual mandate. But he seemed at least a little bit torn.

Perhaps just a bit of solace for the federal government, on a day that otherwise seemed quite bleak.

It seems to be on Kennedy

It sure sounded as if the only vote in play is that of Anthony Kennedy. I thought the Chief Justice might well vote to uphold the mandate, in large measure based on his calculation of the long-term interests of the Court as an institution. There was no indication of that today. Roberts seemed decidedly to favor the challengers. So did Justice Kennedy, but less so. And he also expressed some problems with the challengers' arguments. I think it is fair to say--based on what we know--that the whole thing rides on Kennedy's vote.

Again, he seemed to be leaning against the Act's constitutionality. But there was enough ambiguity in his signals that we can hardly be certain.

If you are a liberal . . .

you should probably be a little disappointed in the Democratic appointees on the Court. One of the most striking things to me about the argument is how unstrategic many of the questions were from the liberals. Justice Kagan aside--who, as always, was quite astute in her questioning--many of the questions from the Democratic appointees were not in any way designed to probe matters or elicit answers that might bring around their more conservative colleagues. Instead, far too much time was spent on Justice Breyer's musings, or the possibility that the breadth of Congress's enumerated powers is merely a political question, to be resolved by the elected branches. It was, quite frankly, an uninspired performance.

The ACA on life support

I am now about 75 minutes into the argument, and it seems clear all five Republican appointees are leaning against upholding the minimum coverage provision. I thought the Chief might be the swing vote, but it certainly does not sound that way from what I've heard thus far. Almost all the questions for the SG came from the Republican appointees, and almost all the questions for Clement are coming from the Democratic appointees. Whatever the merits of the constitutional question, this is slowly looking more and more like Bush v. Gore--with potentially more significant long-term damage to the Court's prestige.  

Audio now available

Here.

Signing off for now

My day job calls--I need to go teach 80 students about the dormant Commerce Clause until 10:15 Pacific. By then, the audio will likely be available, and we will all be making our own judgments about where things stand.