Kate Hicks

The federal government and the states and private respondents will then wage a battle over Congressional intent. Typically, the Court doesn’t concern itself with what Congress meant, but in this case, there are compelling reasons to consider it.

The federal government will argue that most of the law may remain, but that the guaranteed issue and pre-existing conditions clauses were not intended to go into effect with out the mandate to prevent “adverse selection.” Unless the mandate forces healthy people into the insurance market, too, only sick people will jump into the market, thereby exacerbating problems within the healthcare industry, and since the PPACA was intended as a reform, it’s laughable to imagine Congress wanted those provisions to remain if the mandate went.

However, the federal government will also appeal to the Court’s deferential nature, and will argue that it shouldn’t take too heavy of a hand with the law. Cut out the tumor, not the whole organ, so to speak. The mandate had little to do with the rest of the law, so let the remainder stand.

The states and private respondents, on the other hand, will point to the lack of a severability clause as proof that Congress took an all-or-nothing stance on the law. Furthermore, they’ll argue, Congress never would have passed the bill without the mandate. If it went, Congress never intended for the rest of it to stand. The mandate was the star of the show, and when the star is sick, you don’t send the backup singers out on stage anyway. You cancel the show.

When ruling, however, the Justices are likely to take a far more deferential approach to the law. It’s extremely unlikely that they’ll strike down the entire thing. As the 11th Circuit noted (along with many conservatives), most of the law has little to do with private insurance, and doesn’t need the mandate in order to take effect. The Court is much more likely to consider the federal government’s narrower view of severability, and could agree with the fact that certain pieces of the law are inextricable from the mandate. It may only strike down the mandate and nothing else, leaving Congress to undo the potential damage by guaranteed issue and such, but the Justices could likely be persuaded that if the mandate goes, so must the policies it supported.

AFTERNOON: Medicaid and the States

To ensure coverage for those individuals who are too poor for the find-private-insurance-or-pay-a-penalty ultimatum, the federal government expanded Medicaid coverage. First, they said that everyone who is already eligible for Medicaid – i.e. those at the poverty line with dependent children – must enroll. Then, Congress expanded the eligibility requirements to include those at 138% of the poverty line and all adults, not simply those with dependent children.

Medicaid is administered by the states, but they receive funding from the federal government to help cover the costs. In the light of this expansion, the federal government has given the states a choice: accept our expansion, and we will cover 100% of the cost through 2020. After that, you’ll have to chip in some, but only 10% of the cost falls to you. And sure, you can reject the expansion. But if you do, you get no money. Not just the new money to cover the expansion. We’ll cut you off altogether, so the people who were already eligible become entirely your responsibility.

It’s a Vito Corleone-style proposition, to say the least.

Of course, the federal government has the right to attach strings to its money – think speed limits and highway funding – but is there a limit to the requirements the feds issue?

The federal government will argue that Medicaid is a contract, and one that the states have entered voluntarily. The government has always reserved the rights to change the stipulations on granting federal funding to the states. The states knew this when they signed on to Medicaid. Besides, they’re footing the bill for almost all of the new enrollees. In fact, this isn’t a federalism issue at all, they’ll argue. Instead, it’s a partisan one. The states have a dispute over a budgetary matter, not a constitutional one. There are no nefarious coercive elements to the Medicaid funding; the states just want the money without the new enrollees.

The states, by contrast, will argue that this is coercion, and will point to a precedent the Court set a few years ago in a South Dakota v. Dole. In that case, the Court upheld a stipulation – raising South Dakota’s drinking age – attached to a highway bill. However, the opinion pointed to instances where “the financial inducement offered by Congress might be so coercive as to pass the point at which ‘pressure becomes compulsion.’” The states will push the Court to give weight to that statement by arguing that the federal government’s all-or-nothing stance on Medicaid pushes the limits of federalism.

The Court will likely rule against the states, however. Medicaid was, after all, a voluntary program, and even if the states don’t like the current terms for access to funds, they entered into the program on the premise that Congress could change those terms. Again, the Court doesn’t like to step on Congress’ toes, and Dole is a test without an answer key already written. It’s unlikely this will be its limit.

Of course, there’s still nothing stopping Congress from repealing the law. If things go the way of the GOP in November, the Court’s ruling on Medicaid and severability won’t be the final word on the matter. The Court simply arbitrates the limits of Congress’ power. For example, on the severability issue, it doesn’t require the legislative branch to keep the rest of the law. They can get rid of it through their own means, so long as they have the votes.

Kate Hicks

Kate Hicks is one of Townhall.com's web editors. You can follow her on Twitter @KateBHicks.