Holder and Sebelius on Obamacare

Published December 14, 2010

National Review

In the wake of Judge Hudson’s decision striking down the individual mandate in the health-care law as unconstitutional, Attorney General Eric Holder and HHS Secretary Kathleen Sebelius have an op-ed in today’s Washington Post making the case for the law.

Holder and Sebelius’s case rests on an assertion and two implicit assumptions. The assertion is that the law does things we should want to do, and the assumptions are, first, that there are not other ways to achieve these ends and, second, that the means the law employs should therefore be constitutional. If you don’t think that sounds like much of an argument, you’re right.

They begin with the story of Gail O’Brien, a pre-school teacher in New Hampshire who was denied insurance coverage because she suffers from lymphoma, and now benefits from the high-risk pool New Hampshire created under the new law. Then they argue that suing to overturn a law that helps people like O’Brien is “troubling.” Then they argue that treating people without insurance increases the cost of premiums for people who do have insurance, and that in order to require insurers to cover people with pre-existing conditions we have to make sure everyone buys insurance. This leads them to something like a case for the individual mandate (which they call the “individual responsibility provision”):

Everyone wants health care to be affordable and available when they need it. But we have to stop imposing extra costs on people who carry insurance, and that means everyone who can afford coverage needs to carry minimum health coverage starting in 2014.

If we want to prevent insurers from denying coverage to people with preexisting conditions, it’s essential that everyone have coverage. Imagine what would happen if everyone waited to buy car insurance until after they got in an accident. Premiums would skyrocket, coverage would be unaffordable, and responsible drivers would be priced out of the market.

The same is true for health insurance. Without an individual responsibility provision, controlling costs and ending discrimination against people with preexisting conditions doesn’t work.

This is in no way a legal or constitutional argument, of course. And it’s a very weak policy argument. After all, mandating the purchase of insurance is by no means the only way to address the problem of covering people with pre-existing conditions. As the first paragraph of Holder and Sebelius’s own op-ed makes clear, high-risk pools can achieve this too, and without a mandate. Champions of Obamacare only very grudgingly attached a temporary high-risk pool system to the law so that they would have something to show for themselves before 2014 when the new entitlement system gets going. But as many conservative health-care experts have long argued (here’s a great example), high-risk pools are actually a very good alternative to the kind of command-and-control scheme Obamacare would establish. The Virginia lawsuit would in no way undermine the sort of high-risk pool that is helping Gail O’Brien.

As for the notion that requiring everyone to buy insurance is a way to prevent insured people from paying for the cost of covering the uninsured, surely that is a preposterous way to justify a new entitlement program. Holder and Sebelius say that the new law “regulates how we pay for health care by ensuring that those who have insurance don’t continue to pay for those who don’t.” Actually, the law vastly increases the degree to which some Americans pay for the health insurance of other Americans — through a massive expansion of Medicaid and through an enormous new health-care entitlement in the state exchanges. Maybe there’s a case for such redistribution, but Holder and Sebelius don’t offer such a case; they just assert that the law would do the opposite of what it would actually do.

And then, at last, they turn to the question of whether the Constitution even allows for any of this to be done. They write:

Opponents claim the individual responsibility provision is unlawful because it “regulates inactivity.” But none of us is a bystander when it comes to health care. All of us need health care eventually. Do we pay in advance, by getting insurance, or do we try to pay later, when we need medical care?

Their argument, in essence, is that the government has the right to do anything it wants to in the health-care arena because all human beings get sick, and their getting sick can have economic consequences. The choice of some not to purchase insurance means that when they get sick they might incur some costs that would have to be shouldered by others. “For decades,” Holder and Sebelius write, “Supreme Court decisions have made clear that the Constitution allows Congress to adopt rules to deal with such harmful economic effects.” And the way the new health-care law would “deal with” such harmful effects is to make it illegal to make the choice not to purchase insurance. Simple.

By the same logic, of course, you might argue that the government can require each of us to exercise every day and eat our vegetables. Our choice not to do so has grave economic consequences, after all, and under Obamacare, those consequences will be borne by our fellow citizens to an even greater degree than they are today.

Holder and Sebelius offer an unusually revealing glimpse into the mindset of the left today. Every public problem is understood to be ripe for federal intervention, the intervention is to take the form of mandates to simply make different “choices” that better comport with what policymakers want, and doing what you are told by the government is the new definition of individual responsibility. And for all of this to pass constitutional muster, all you have to show is that the end you’re pursuing is a material end, since the Commerce Clause says that addressing any problem with an economic component is a proper end of government and the Necessary and Proper clause says that such ends justify all means.

This is no way to govern a free people. It utterly fails to contend with the character of our society, basic economics, and the plain meaning of the Constitution.

There is no doubt that we have a health-care financing problem in America. The costs of coverage and care are rising too quickly and so too many people are left unable to afford insurance. The left’s solution to this problem is simply to order those costs not to rise: by imposing price controls on providers and mandating the purchase of the resulting insurance products by all. The right’s solution is to foster the development of a genuine market for health insurance — by changing three government policies (Medicare, Medicaid, and the tax exclusion for employer-provided coverage) that have prevented the development of such a market and so enabling consumers to make actual choices among actual alternatives and encouraging providers to compete by offering better products at lower costs.

This is in one sense a debate between different ways of thinking about economics — command-and-control economics vs. market economics. But as Holder and Sebelius demonstrate today, it is also a debate between different ways of understanding American society, and the American Constitution. Their argument makes it awfully clear why it is so important to win that debate and repeal Obamacare.

Yuval Levin is the editor of National Affairs and the Hertog fellow at the Ethics and Public Policy Center.

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