Executive Summary: Why the Personal Mandate to Buy Health Insurance Is Unprecedented and Unconstitutional

Report Health Care Reform

Executive Summary: Why the Personal Mandate to Buy Health Insurance Is Unprecedented and Unconstitutional

December 9, 2009 4 min read Download Report

Authors: Todd Gaziano, Randy Barnett and Nathaniel Stewart

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As the Congressional Budget Office explained: "A mandate requiring all individuals to purchase health insurance would be an unprecedented form of federal action. The government has never required people to buy any good or service as a condition of lawful residence in the United States." Yet, all of the House and Senate health-care bills being debated require Americans to either obtain or purchase expensive health insurance, estimated to cost up to $15,000 per year for a typical family, or pay substantial tax penalties for not doing so.

The purpose of this compulsory contract, coupled with the arbitrary price ratios and controls, is to require some people to buy artificially high-priced policies as a way of subsidizing coverage for others and an industry saddled with the costs of other government regulations. Rather than appropriate funds for higher federal health-care spending, the sponsors of the current bills are attempting, through the personal mandate, to keep the forced wealth transfers entirely off budget.

This takes congressional power and control to a strikingly new level. An individual mandate to enter into a contract with or buy a particular product from a private party is literally unprecedented, not just in scope but in kind, and unconstitutional either as a matter of first principles or under any reasonable reading of judicial precedents.

The Commerce Clause. Advocates of the individual mandate have claimed that the Supreme Court's Commerce Clause jurisprudence leaves "no doubt" that the insurance requirement is a constitutional exercise of that power. They are wrong.

Although the Supreme Court has upheld some far-reaching regulations of economic activity, most notably in Wickard v. Filburn and Gonzales v. Raich, neither case supports the individual health insurance mandate. In these cases, the Court held that Congress's power to regulate the interstate commerce in a fungible good--for example, wheat or marijuana--as part of a comprehensive regulatory scheme included the power to regulate or prohibit the intrastate possession and production of this good. In both cases, Congress was allowed to reach intrastate economic activity as a means to the regulation of interstate commerce in goods.

Yet, the mandate to purchase health insurance is not proposed as a means to the regulation of interstate commerce; nor does it regulate or prohibit activity in either the health insurance or health care industry. Indeed, the health care mandate does not purport to regulate or prohibit activity of any kind, whether economic or noneconomic. By its own plain terms, the individual mandate provision regulates no action. To the contrary, it purports to "regulate" inactivity by converting the inactivity of not buying insurance into commercial activity. Proponents of the individual mandate are contending that, under its power to "regulate commerce...among the several states," Congress may reach the doing of nothing at all!

In recent years, the Court invalidated two congressional statutes that attempted to regulate non-economic activities. In United States v. Lopez (1995), it struck down the Gun-Free School Zones Act, which attempted to reach the activity of possessing a gun within a thousand feet of a school. In United States v. Morrison (2000), it invalidated part of the Violence Against Women Act, which regulated gender-motivated violence. Because the Court found the regulated activity in each case to be noneconomic, it was outside the reach of Congress's Commerce power, regardless of its effect on interstate commerce.

To uphold the insurance purchase mandate, the Supreme Court would have to concede that the Commerce Clause has no limits, a proposition that it has never affirmed, that it rejected in Lopez and Morrison, and from which it did not retreat in Raich. Although Congress may possibly regulate the operations of health care or health insurance companies directly, given that they are economic activities with a substantial effect on interstate commerce, it may not regulate the individual's decision not to purchase a service or enter into a contract.

If Congress can mandate this, then it can mandate anything. Congress could require every American to buy a new Chevy Impala every year, or a pay a "tax" equivalent to its blue book value, because such purchases would stimulate commerce and help repay government loans. Congress could also require all Americans to buy a certain amount of wheat bread annually to subsidize farmers.

Even during wartime, when war production is vital to national survival, Congress has never claimed such a power, nor could it. No farmer was ever forced to grow food for the troops; no worker was forced to build tanks. And what Congress cannot do during wartime, with national survival at stake, it cannot do in peacetime simply to avoid the political cost of raising taxes to pay for desired government programs.

Other Constitutional Problems. Senators and Representatives should also know that:

  • There are four constitutionally relevant differences between a universal federal mandate to obtain health insurance and the state requirements that automobile drivers carry liability insurance for their injuries to others on public roads;
  • A review of the tax provisions in the House and Senate bills raises serious questions about the constitutionality of using the taxing power in this manner; and
  • Since there literally is no legal precedent for this decidedly unprecedented assertion of federal power, it is highly unlikely that the Supreme Court would break new constitutional ground to save an unpopular personal mandate.

Members of Congress have a responsibility, pursuant to their oath, to determine the constitutionality of legislation independently of how the Supreme Court has ruled or may rule in the future. But Senators and Representatives also should know that, despite what they have been told, the health insurance mandate is highly vulnerable to challenge because it is, in truth, unconstitutional. And all other considerations aside, the highest obligation of each Member of Congress is fidelity to the Constitution.

Randy Barnett is the Carmack Waterhouse Professor of Legal Theory at the Georgetown University Law Center. Nathaniel Stewart is a lawyer at the firm of White & Case, LLP. Todd Gaziano is the Director of the Center for Legal and Judicial Studies at The Heritage Foundation.


Todd Gaziano

Former Director, Center for Legal & Judicial Studies

Randy E. Barnett
Randy Barnett

Constitutional Law Professor, Georgetown Law, and Director, Georgetown Center for the Constitution

Nathaniel Stewart

F.M. Kirby Research Fellow in National Security Policy