In Reversal, Democrats Defend Mandate To Buy Health Coverage as Tax
In legal challenges of the constitutionality of the new health reform law, the Obama administration has defended Congress' ability to enact an individual insurance mandate as a tax on U.S. residents, despite its insistence during the debate over the law that it was not a tax, the New York Times reports.
According to Democrats, the tax argument is a crucial component of their defense of the reform law and the mandate to have health insurance.
Power Through Interstate Commerce
Congress anticipated a constitutional challenge to the mandate while crafting the law, the Times reports. As a result, lawmakers developing the overhaul designed the provision around a regulation of commercial activity.
The law includes 10 detailed findings designed to show that the mandate is legal under Congress' power to regulate interstate commerce.
The legislation does not cite Congress' ability to tax as a defense of the measure.
Justice Department Weighs In
Last September, President Obama said of the mandate, "For us to say that you've got to take a responsibility to get health insurance is absolutely not a tax."
However, the Department of Justice in legal proceedings has said the penalty for not acquiring insurance is a tax because it will raise substantial revenue -- $4 billion each year by 2017, according to the Congressional Budget Office -- and because the penalty is imposed and collected by the Internal Revenue Service.
The department notes that people must report it on their tax returns "as an addition to income tax liability" and that Congress can use its taxing power for reasons that would exceed its authority under other measures.
DOJ officials have said that because the mandate is a tax, no one can challenge it in court before paying it and seeking a refund (Pear, New York Times, 7/16).
Opinion Piece Criticizes Individual Mandate for Regulating 'Absence of Commerce'
The individual mandate "has its origins in the Commerce Clause of the Constitution," but instead it is "being used to regulate the absence of commerce," Eric Novack, an orthopedic surgeon and chair of Arizonans for Health Care Freedom and the U.S. Health Care Freedom Coalition, writes in a Washington Times opinion piece.
Novack continues that the distinction is "noteworthy" because "if Congress can compel the purchase of a product -- health insurance -- under its authority to regulate and stabilize the interstate market for health care, then, using the same legal theory, what transaction can't it compel?" (Novack, Washington Times, 7/16).