Home > Current, Law, Legal, Politics > The Unconstitutionality of the Affordable Care Act: A Comparative Case Study in Enforcement Discretion

The Unconstitutionality of the Affordable Care Act: A Comparative Case Study in Enforcement Discretion

December 31, 2013 Leave a comment Go to comments

The Affordable Care Act already has survived direct and indirect legal challenges in the courts, the early stages of which I analyzed here three years ago.

Facial legal challenges cast aside, the health reform legislation is facing a fresh round of scrutiny in 2013 as the time for implementation of the law has arrived.

In July, the President stated that he was suspending the law’s “employer mandate” provision for one year, meaning that employers would have additional time to meet their obligations under the Act. As former federal judge Michael McConnell explained, however, the president does not have the authority to refuse to enforce certain portions of a law:

President Obama’s decision last week to suspend the employer mandate of the Affordable Care Act may be welcome relief to businesses affected by this provision, but it raises grave concerns about his understanding of the role of the executive in our system of government.

Article II, Section 3, of the Constitution states that the president “shall take Care that the Laws be faithfully executed.” This is a duty, not a discretionary power. While the president does have substantial discretion about how to enforce a law, he has no discretion about whether to do so.

This matter—the limits of executive power—has deep historical roots. During the period of royal absolutism, English monarchs asserted a right to dispense with parliamentary statutes they disliked. King James II’s use of the prerogative was a key grievance that lead to the Glorious Revolution of 1688. The very first provision of the English Bill of Rights of 1689—the most important precursor to the U.S. Constitution—declared that “the pretended power of suspending of laws, or the execution of laws, by regal authority, without consent of parliament, is illegal.”

To make sure that American presidents could not resurrect a similar prerogative, the Framers of the Constitution made the faithful enforcement of the law a constitutional duty.

Michael McConnell, Obama Suspends the Law, Wall Street Journal, July 8, 2013 (emphasis added).

McConnell closed his article by explaining that such unauthorized executive action is likely to remain unchecked and could have ongoing, troublesome consequences:

The courts cannot be counted on to intervene in cases like this. As the Supreme Court recently held in Hollingsworth v. Perry, the same-sex marriage case involving California’s Proposition 8, private citizens do not have standing in court to challenge the executive’s refusal to enforce laws, unless they have a personal stake in the matter. If a president declines to enforce tax laws, immigration laws, or restrictions on spending—to name a few plausible examples—it is very likely that no one will have standing to sue.

Of all the stretches of executive power Americans have seen in the past few years, the president’s unilateral suspension of statutes may have the most disturbing long-term effects. As the Supreme Court said long ago (Kendall v. United States, 1838), allowing the president to refuse to enforce statutes passed by Congress “would be clothing the president with a power to control the legislation of congress, and paralyze the administration of justice.”

Id.

In support of his selective enforcement approach, subsequently used again to try to make good on his promise that Americans could retain existing health insurance coverage (which the Affordable Care Act actually did not allow in some circumstances), the President relied upon “an expansive reading of Heckler v. Chaney, an important Supreme Court decision from 1985 [in which] the Court held that agencies have wide discretion to decide whether, when, and how to enforce the law“:

No agency, the Court explained, has enough resources to police every technical legal violation. Instead, agencies must set priorities based on a host of factors—the harm caused by the violation, the likelihood of prevailing, the need to conserve scarce resources, and the like. Courts shouldn’t second-guess how an agency weighs all those factors. Enforcement, in the legal jargon, is “committed to agency discretion by law.”

Nicholas Bagley, Is Obama’s “like it/keep it” fix legal?, The Incidental Economist (Nov. 18, 2013, 8:00 AM). Professor Bagley, someone not unsympathetic to the Affordable Care Act, doubts the viability of the President’s discretionary enforcement approach. Echoing McConnell, above, he writes that the President may have stretched Heckler‘s discretionary principle too far: “Although federal agencies have wide discretion to decline to prosecute, they can’t dispense with the law altogether. That would contravene the President’s constitutional duty to ‘take Care that the Laws be faithfully executed.’” Id. In setting out the reasons why he doubted the President’s authority to act in this context and manner, Bagley explained that, in effect, the President simply was rewriting the law:

Heckler’s general assumption that agencies have enforcement discretion can be rebutted where a statute constrains that discretion. Here, the ACA probably does. On Thursday, the president acknowledged that he was trying to “fix” the ACA’s grandfather clause, which, in his view, was drafted too narrowly. But doesn’t that clause stand as persuasive evidence that the plans that it covers are the only ones that Congress wanted to grandfather? Whatever the scope of its enforcement discretion, the administration probably can’t exercise that discretion to deliberately rewrite the statute.

Id. As Professor Jonathan Adler added, the grandfather clause “fix” also imposed new obligations on private insurers, something he is skeptical the President has any authority to do:

Whether or not requiring such disclosure is a good idea, I am aware of no provision in the law that authorizes such a requirement and, more importantly, I do not see how the Administration can impose such a requirement through an exercise of its enforcement discretion outlined in a press conference and a guidance letter.  Put another way, if the Administration wishes to impose such an obligation on insurers, it could conduct a rulemaking and promulgate regulations. What it cannot do is simply announce that it will forbear enforcing the law provided that regulated entities “voluntarily” agree to a new, unauthorized set of regulatory requirements.

Jonathan Adler, More on the Legality of the Latest ObamaCare Fix, The Volokh Conspiracy (Nov. 18, 2013, 11:52 PM).

The simple lesson here is that, while the executive branch has some discretion in how it enforces laws, it generally must live with the terms of laws as passed by Congress and signed by the President.

_______________________________________________________________

Beyond the the primary question of enforcement discretion is the question of the President’s discretion to exercise that discretion. While he was willing to do so in July to ease the burden of the Affordable Care Act on businesses, as described above, he was not willing to short circuit Congress in November, when he was asked to ease the burden on immigrant families being split up as a result of deportation. Perhaps the criticism he received about his handling of the Affordable Care Act imparted upon him a newfound respect for congressional authority, the Constitution’s separation of powers, and Article II, Section 3′s Take Care Clause.

President Barack Obama renewed his call for the House to pass immigration legislation, framing the issue as crucial to boosting the U.S. economy in remarks that also included an unscripted exchange with a young man protesting deportations.

“When it comes to immigration reform, we have to have the confidence to believe we can get this done, and we should get it done,” Mr. Obama said. “The only thing standing in our way right now is the unwillingness of certain Republicans in Congress to catch up with the rest of the country.”

During his speech, the president was interrupted by a protester who urged him to take immediate executive action to halt deportations, saying that his own family had been separated.

The president told the man—who later identified himself to reporters as 24-year-old Ju Hong —that he couldn’t take direct action without the cooperation of Congress.

“The easy way out is to try to yell and pretend like I can do something by violating our laws,” Mr. Obama replied. “And what I’m proposing is the harder path, which is to use our democratic processes to achieve the same goal that you want to achieve. But it won’t be as easy as just shouting.”

Deportations have become a central issue for immigrant-rights groups as prospects for legislation have dimmed. Nearly 12 million immigrants live in the U.S. illegally, according to the nonpartisan Pew Hispanic Center. The Obama administration has been deporting about 400,000 immigrants annually, more than during the Bush administration.

Alejandro Lazo, Obama Immigration Speech Gets Heated Input, Wall Street Journal, Nov. 25, 2013.

This secondary level of discretion practically illustrates the danger to democracy this brand of selective enforcement presents. To place President Obama’s exercise of this discretion in context,

Attorneys general under Presidents Carter, Reagan, both Bushes and Clinton all agreed [that the president may decline to enforce laws he believes are unconstitutional, but that he has no authority to refuse to enforce a statute he opposes for policy reasons]. With the exception of Richard Nixon, whose refusals to spend money appropriated by Congress were struck down by the courts, no prior president has claimed the power to negate a law that is concededly constitutional.

McConnell, supra.

Categories: Current, Law, Legal, Politics
  1. January 1, 2014 at 11:57 am

    Very nice post.

    On the comparison of the immigration and the ACA situations there is the fact that the discretion used for the ACA applies over a fixed period of time while any immigration changes would presumably apply forever until changed (when a republican president is elected).

    One other thought is to move this from the theoretical to the practical which is that the ACA is Obama’s baby. Him relaxing some of the pressure it applies appears to be a practical matter for implementation that may not have been realized during the writing of the bill. Of course this could open the door to future ignoring of laws at will by the executive branch, but I don’t know how to predict what presidents or the SC will do with this in the future.

    This was a fun topic. How long have you been writing this post? (WSJ July reference)

    • AD
      January 2, 2014 at 7:26 am

      Thank you. Yes, it’s true that the ACA modifications are only supposed to be over a fixed period of time, but who knows? It’s not as if those time periods are prescribed in law. And yes, I understand why he did it; the point is that he did not have the authority to do it.

      Thanks. I saved the McConnell article when I read it in July, and when I saw the November immigration story, the concept of the post came together for me.

  2. AD
    February 11, 2014 at 8:58 am

    The Obama Administration has further delayed the implementation of the Affordable Care Act with respect to midsized (50-99 employees) employers.

    Professor Eugene Kontorovich writes that this move is an “aggressive and constitutionally dubious exercise of executive power,” and that, taken together, these executive modifications of the Act are beginning to look like the products of “a new permanent form of executive lawmaking.”

    Professor Adler agrees:

    Whatever the stated reason for the new delay, it is illegal. The text of the PPACA is quite clear. The text of the Patient Protection and Affordable Care Act provides that the employer mandate provisions “shall apply” after December 31, 2013. The Treasury Department claims that it has broad authority to offer “transition relief” in implementing the law. That may often be true, but not here. The language of the statute is clear, and it is well established that when Congress enacts explicit deadlines into federal statutes, without also providing authority to waive or delay such deadlines, federal agencies are obligated to stay on schedule.
    . . .
    The Obama Administration is not the first to take liberties with the laws it is charged with executing, and it will not be the last. Yet the increasing brazenness with which the Administration is disregarding inconvenient or ill-conceived portions of its signature legislative achievement lowers the bar to a disturbing degree. Even where ad hoc administrative revisions seem justified to ease the law’s implementation, such moves are illegal if not authorized by Congress. The Executive Branch is supposed to faithfully execute the laws Congress enacts, not rewrite them.

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