U.S. Department of Health and Human Services v. Florida

(1) Whether the Patient Protection and Affordable Care Act is beyond Congress’ powers under Article I because it includes a mandate that individuals must obtain health insurance or pay a monetary fine; and (2) Whether the Anti-Injunction Act, 26 U.S.C. §7421(a), bars suits by challengers to the Act.

Congress passed the Patient Protection and Affordable Care Act (the Act) in an effort to address rising health care costs and to provide affordable insurance coverage for uninsured Americans. Since its enactment, the Act has been widely challenged by twenty-six states, individuals, and private businesses (Respondents) who assert that § 1601, which requires individuals to obtain federally approved health insurance by 2014 or pay a penalty, is outside the scope of Congress’s power granted by the Commerce Clause and the Necessary and Proper Clause. Respondents also claim that the penalty imposed on individuals who fail to maintain minimum health insurance is not a tax, therefore, it is not authorized under the Taxing and Spending Clause. Whether or not the penalty is a tax is relevant to whether the suit could be barred by the Anti-Injunction Act (26 U.S.C. §7421), which prohibits suits restraining the collection of a tax.

The District Court granted summary judgment for Respondents, and held that the Act was unconstitutional as a whole since § 1601 was non-severable and outside the boundaries of Congress’s Commerce Power. The District court further held that the penalty imposed was not a tax. On a motion for clarification by the government, the District Court entered a stay pending appeal. The Court of Appeals for the Eleventh Circuit affirmed in part holding that § 1601 was outside the scope of Congress’s power under the Commerce Clause. It also held that the individual mandate operated as a regulatory penalty, and not as a tax pursuant to the Taxing and Spending Clause, because the goal of the individual mandate was not to raise revenue, but to reduce the number of uninsured Americans and to make health insurance more widely available.

On review, Petitioners argue that the Anti-Injunction Act is not jurisdictional and so does not serve as a barrier to review of the first issue. If the court found the Act jurisdictional, the Court could not rule on the second issue until the Act had been actually enforced against a person. On the first issue, Petitioners renew their arguments from the court below. Petitioners argue that § 1601 is valid under both the Commerce Clause and the Necessary and Proper Clause because healthcare has to do with the regulation of commerce. In the alternative, Petitioners argue that the Act is constitutional as a tax under the General Welfare Clause.