Day Three Part One — Severability

Good afternoon.  The Court went long today, leaving only about an hour between now and the beginning of today’s final Q&A, so I’m going to be forced to keep my posts short and sweet.

The first issue today, on the final day of the Court’s three-day ACA hearing, was about “severability” — i.e., the question of what parts of the ACA the Court should leave in place, and what parts should fall, in the event the Court strikes down the individual mandate.  That issue arises because when the Court strikes down part of a statute, sometimes what’s left doesn’t make any sense standing alone.  So the Court asks what Congress would have wanted in that circumstance:  Would it have wanted what’s left to remain as a free-standing law?  If so, the Court will “sever” the unconstitutional piece of the law, strike that down, and leave the rest in place.

In this case, no party was arguing that the rest of the ACA should remain in place if the mandate were to be struck down.  The government has argued that two provisions — the guaranteed issue and community rating provisions, which make insurers cover those with pre-existing conditions at market rates — should fall along with the mandate, because the mandate was necessary to make them work properly.  And the law’s challengers have argued that the entire law should fall if the mandate falls — even totally unrelated provisions in the 2700-page law involving funding or reauthorization for existing health programs.  So the court appointed a lawyer, H. Bartow Farr III, to argue the position neither party was taking — that if the mandate falls, Congress would have wanted everything else to remain in place.

Below I’ll summarize today’s arguments.  And to repeat my usual mantra, it is tricky to infer from Justices’ questions at argument exactly where they really stand on issues.  That said, today’s argument suggested that the Court once again is split along partisan lines, with some Justices still in play:  The Court’s liberal wing seemed to agree with the government that only guaranteed issue and community rating should be struck down if the mandate falls; much of the conservative wing appeared to agree with the challengers that the whole law should fall; and Chief Justice Roberts asked tough questions of both sides.  On this issue, too, the outcome is too close to call.  (Of course, bear in mind that if the Court upholds the individual mandate, this issue becomes irrelevant and the Court doesn’t have to discuss it in its opinion.)

To the argument:

The challengers.  Paul Clement argued first on behalf of the law’s challengers.  He argued that the ACA is very interconnected — the mandate affects the guaranteed issue and community rating provisions, and it also affects the exchanges, and the exchanges affect the law’s tax provisions, and so on — and as a result much of the law must fall, because it won’t function correctly without the mandate.  He said what is left — hundreds of unrelated provisions having to do with everything from Indian law to breastfeeding — should also fall in that case because all that would be left of the law is a “hollow shell,” and that’s not what Congress would have wanted.

The conservatives remained largely silent during much of Clement’s argument, as he took fire from the Court’s liberal wing.  Justice Sotomayor asked why the Court shouldn’t “leave it in the hands” of Congress to fix any problems that arise from the bulk of the statute remaining in place.  Justice Kagan suggested there is a “sharp dividing line” between the guaranteed issue and community rating provisions, which appear closely connected to the mandate, and the rest of the statute, which does not.  And Justice Ginsburg asked why the Court should “make Congress redo” the many provisions of the Act that are not related to the mandate.  All of their questions suggested support for the government’s position — strike down guaranteed issue and community rating and leave the rest.

Much of the Court’s conservative wing said nothing during Clement’s argument.  But Chief Justice Roberts, interestingly, made comments suggesting his potential support for the government’s position.  He suggested that Clement’s “hollow shell” argument was wrong because many of the provisions in the statute really don’t have any obvious connection to the mandate.

The government.  Deputy Solicitor General Edwin Kneedler argued for the government.  He echoed Justice Kagan’s comments that guaranteed issue and community rating are intimately connected to the mandate, while the rest of the law is not.  And he was quickly challenged by Justices Scalia, Kennedy, and Alito.  Justice Scalia seemed concerned that, if the Court left a non-workable statute in place and left the ball in Congress’ court to fix it, that would “distort” the legislative process because it’s harder to repeal a law than it is to pass it in the first place.  Justice Kennedy suggested the more restrained judicial approach would be to strike down the whole law and let Congress decide what to enact, rather than picking and choosing for Congress.  And Justices Scalia, Kennedy, and Alito all repeatedly expressed concern about what would happen to insurance companies if the rest of the law remains in place absent the mandate.  Kennedy at one asked whether the best course was for the Court to “assume” that Congress would not have wanted to “impose the risk” of hundreds of millions of dollars in losses on insurers and others who potentially would fare worse under an ACA without the individual mandate.

Chief Justice Roberts, for his part, seemed most concerned during this part of the argument with how exactly the severability process should work.  In questions echoed by other Justices, including Breyer and Scalia, he asked how the Court could pore over a 2700-page law and decide whether Congress would have wanted to keep or jettison each piece absent the mandate.

In the end, Chief Justice Roberts and several other Justices expressed dissatisfaction with the Court’s current severability test; it is difficult or impossible to figure out, they suggested, what Congress would really want to keep in a statute this large and complex.  That leaves open the possibility that the Court will fashion a new severability test.  The one thing it most likely won’t do is reject both parties’ positions and accept the one advanced by Farr, the lawyer the Court appointed to argue that everything should stand if the mandate falls.  No member of the Court expressed audible support for that theory.


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