Tying together strands from the legal reasoning in the twin Supreme Court cases on Obamacare, we find a principle that just might shield individual Americans from the coercive force of the federal government if it were ever properly applied.

It’s a simple fact in the insurance business: the more policyholders file claims, the more pressure there is for companies to raise the price of premiums.

Insurance companies cope with such pressure through several tactics. They can raise the premiums of those who file claims, and they can raise the premiums of those who pose higher-than-average risk, like teenage drivers. They can also refuse to insure those who could file particularly expensive claims, such as refusing to offer flood insurance to those who live in ocean-side communities, especially if they’re below sea level, like parts of New Orleans. Such tactics aim at keeping the average premium affordable.

However, the standard practices used by insurance businesses to keep the price of premiums affordable have been disallowed in one sector of the industry: health insurance. Both state and federal governments have instituted twin policies of “guaranteed issue” and “community rating” into health insurance markets. The former stipulates that nobody can be denied health insurance due to “preexisting conditions,” and the latter ordains that everybody pays the same for premiums. Both policies put an upward pressure on premium prices, and have led to serious problems when tried in the states.

It may seem a strange link, but in his recent ruling in King v. Burwell, Chief Justice Roberts wrote a concise little history of what happened in states that instituted the twin policies.

“This cycle happened repeatedly during the 1990s. For example, in 1993, the State of Washington reformed its individual insurance market by adopting the guaranteed issue and community rating requirements. Over the next three years, premiums rose by 78 percent and the number of people enrolled fell by 25 percent. By 1999, 17 of the State’s 19 private insurers had left the market, and the remaining two had announced their intention to do so. […]

“For another example, also in 1993, New York adopted the guaranteed issue and community rating requirements. Over the next few years, some major insurers in the indi­vidual market raised premiums by roughly 40 percent. By1996, these reforms had “effectively eliminated the com­mercial individual indemnity market in New York with the largest individual health insurer exiting the market.”

As Roberts chronicles, the twin policies of guaranteed issue and community rating tore up the health insurance business in states adopting them; premiums soared due to “adverse selection,” and companies fled the states in fearsome “death spirals.”

However, Massachusetts developed a solution in 2006, and it was later cemented into ObamaCare. The solution involved two new policies: tax credit subsidies, the issue in King, and the “individual mandate,” one of the issues in NFIB v. Sebelius.

The individual mandate posed a problem for Justice Roberts. In NFIB, he wrote on PDF-page 50: “The Federal Government does not have the power to order people to buy health insurance. Section 5000A would therefore be unconstitutional if read as a command.”

Yes. But why is the individual command unconstitutional? Roberts contends that the Commerce Clause doesn’t extend that far. But could it have something to do with the Tenth Amendment?

Roberts mentions the Tenth only once in NFIB, when he referred to the Court of Appeals on PDF-page 17.

“And the court rejected the States’ claim that the threatened loss of all federal Medicaid funding violates the Tenth Amendment by coercing them into complying with the Medicaid expansion.” The Supreme Court reversed that and held that the States would not lose all Medicaid funding if they did not expand Medicaid. Furthermore, on PDF-page 53, Roberts wrote: “That insight has led this Court to strike down federal legislation that commandeers a State’s legislative or administrative apparatus for federal purposes.” To back that up, Roberts cites Printz v. United States and New York v. United States, and both those cases touch on the Tenth and commandeering, especially New York.

So, there may be a link between the Medicaid expansion issue and the individual mandate issue: the Tenth Amendment.

You see; the Tenth Amendment reserves undelegated powers not only to the States but to the people as well. So, if Congress cannot commandeer the States for federal purposes, how can they commandeer the people? But that’s what the individual mandate does; it commandeers the people in order to make a federal program, Obamacare, workable. Without the individual mandate, the twin policies of community rating and guaranteed issue would make health insurance unaffordable.

Justice Roberts rescued the individual mandate by bringing it into the ambit of the power to tax. By Roberts’s reasoning, Congress can tax the people for not doing what Congress cannot command the people to do, yet Congress cannot punish States for not doing what Congress cannot commandeer the States to do.

The Ninth Amendment refers to rights “retained by the people.” And the Tenth Amendment refers to powers “reserved to the States respectively, or to the people.” So it doesn’t seem too crazy to wonder whether “commandeering” the States might be akin to commanding the people if both are for furthering a federal program, like Obamacare.

Tenth Amendment Center national communications director Mike Maharrey explores the “anti-commandeering doctrine” and reminds us the “James Madison asserted in Federalist 45, the powers of the federal government are “few and defined.” So, federal power actually extends into only a few spheres. Most power and authority was left to the states and the people.”

The 10th Amendment asserts the sovereignty of not only the states, but the people as well, and protects it from federal encroachment. If the feds can’t coerce the states, they shouldn’t be able to coerce the people either.

The 10th Amendment

“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”



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