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Defending The Affordable Care Act


I'm Michel Martin and this is TELL ME MORE from NPR News. Coming up, a rally set for the nation's capitol this weekend aims to raise the profile of secular Americans. Organizers are calling it the reason rally and one of the featured speakers will tell you more about it in just a few minutes. But first, we are going to have the latest in a series of conversations we've been having about what may be the most high profile Supreme Court case in years.

Next week, the Supreme Court will hear arguments for and against the Affordable Care Act, that is the landmark law that supporters call one of the most significant pieces of legislation in a generation, but which opponents tend to deride as Obamacare. The justices may decide to throw out key provisions or perhaps the entire health policy law. We spoke yesterday to Michael Cannon of the Cato Institute. That's a libertarian research and policy group that's among the dozens of organizations who filed briefs opposing the law.

We want to get a different perspective now so we've called upon Neal Katyal. He is the former acting solicitor general of the United States under President Obama. He defended the Affordable Care Act in lower courts, including the U.S. Court of Appeals for the 11th Circuit. He's also a professor at the Georgetown Law Center and a partner with the international law firm Hogan Lovells. And he's with us now from his office. Welcome. Thank you so much for joining us.

NEAL KATYAL: Thank you for having me here.

MARTIN: As of course you know, one of the most controversial elements of the Affordable Care Act is the whole question of the individual mandate. Opponents are arguing that this simply exceeds the authority of the federal government to impose such a mandate. What's the argument against that?

KATYAL: I think the most important thing the Supreme Court will be thinking about is kind of can they really remove this issue from the Democratic process and say this law of Congress is unconstitutional. Now with respect to the individual mandate, what Congress was doing in the Affordable Care Act is it said that there are 50 million Americans who lack health insurance right now largely because they're priced out of the health insurance markets.

And the result of that is that when those 50 million Americans get sick, they go to the emergency room and other places and you and I, American taxpayers, basically foot the bill for that in the form of higher insurance premiums. Congress found that it is $43 billion in uncompensated care that happen each year and that the average American family spends $1,000 more in health premiums to pay for this.

So what Congress said in the Affordable Care Act is we've got to get rid of that. And the way to get rid of it is to end this practice of insurers discriminating against those with preexisting conditions. They said we shouldn't have that happen so they prohibited that. But they knew that seven states had done precisely that and it lead to a disaster because in those seven states, what happened is people waited to sign up for insurance until they got sick.

They'd literally wait until they were in the ambulance to sign up. It's kind of like if an insurance company's told you have to issue a policy for fire insurance to anyone who wants one. You'll wait until your house is on fire until you sign up for it. The one state that worked was the state that did something different. And that was Massachusetts. And what they did was they said, OK, we're going to ban discrimination against those with preexisting conditions and require all insurers to insure everyone.

But at the same time, we need to avoid that adverse selection problem, of people waiting to sign up for insurance only when they get sick. So what we're going to do is we're going to require everyone to have some insurance, a minimum amount of insurance to avoid that problem. And that worked much, much better than what happened in the other seven states. And that is really the template for what the federal government is doing here.

MARTIN: First, I want to play a short clip from Michael Cannon of the Cato Institute who spoke to us yesterday as we said. This is a little of what he told us. Here it is.

MICHAEL CANNON: If the Supreme Court were to uphold this unprecedented and really breathtaking assertion of government power, there would be nothing to stop the Congress from forcing Americans to purchase any private product that Congress chose to favor. That could be a gym membership. That could be stock in Exxon Mobil. That could be broccoli if Congress decided that any of these products move in interstate commerce and that forcing you to buy it was essential to the regulatory scheme they wanted to enact.

MARTIN: What is your response to that?

KATYAL: Well, I mean, that's a lot of rhetoric and not really a legal argument because it's not responsive to what the government is asking for here. What the government is saying is, look, everyone consumes healthcare in this country, you and I. And, you know, even if I might say to myself, I don't need health insurance. I won't get sick. The fact is, as human beings with mortality, we are going to get sick and it's unpredictable when.

You could get struck by a heart attack or cancer or hit by a bus and wind up in the emergency room and then it's average Americans who have to pick up the tab for that. And so the government is not saying here we have the power to force people to buy goods. They're saying, look, you're going to already buy the goods. You're going to use it. And the only question is, are you going to have the financing now to pay for it.

And so the government is regulating financing. It's kind of like a government law that says you've got to pay cash or credit. It's not the government coming in and saying, oh, consume this product you wouldn't otherwise consume. And as for the kind of, you know, ludicrous suggestion that this would somehow lead to the government forcing people to eat broccoli or the like, I mean, I would think that someone from the Cato Institute would know that the Bill of Rights and the privacy protections in the constitution would protect against such drastic hypotheticals.

MARTIN: If you're just joining us, this is TELL ME MORE from NPR News. We are looking ahead to arguments that are expected to be heard in the Supreme Court next week around the healthcare law. We're talking about issues on both sides. Yesterday we spoke with Michael Cannon of the Cato Institute. That's a libertarian think tank. They are among the groups who have filed briefs opposing the law. With us today, Neal Katyal, the former Acting Solicitor General of the United States.

He defended the Affordable Care Act when this case was in the lower courts. He is a professor at Georgetown Law School and a partner in the law firm of Hogan Lovells. Could the law still stand apart from the individual mandate?

KATYAL: Well, there are a variety of different positions on this. I mean, the law is 2400 pages long and has all sorts of stuff that have nothing to do with the individual mandate, things like funding for abstinence education in classrooms and the like. So certainly a good part of the law could stand. I mean, the government's position in the case has been, well, most of the law could stand, but some of it has to go.

If the individual mandate goes so, too, the government says, must the provisions that force insurers to insure everyone at a low cost, the so-called guaranteed issue and community rating provisions. And the logic for that is the logic that I said a few minutes ago, which is seven states had tried to do that, to ban discrimination against those with preexisting conditions and force insurers to insure everyone.

But that actually led to a disaster, to an adverse selection problem whereby people waited to get insurance until it was too late. And so the government's position is, look, if one part goes then the other goes. Obviously, the government's main view is none of it should go, that this is stuff that's political in nature. And if you don't like the individual mandate, there's a very easy solution, which is you vote President Obama out of office.

You know, you vote the members of Congress who voted for it out of office and you change the law. But you don't let some unelected judges in Washington do the hard work of the Democratic process for you.

MARTIN: The Congressional Budget Office is now estimating that the law will cost less than was originally projected, but it still projects a net cost of more than a trillion dollars over the next 10 years. And there are those who argue it's just too expensive, that the free market could do this in a more efficient way, that there's still too much government in healthcare and that the way to bring costs down is to remove the government footprint even more. What's your response to that, if you feel comfortable offering one?

KATYAL: Well, I would say two things. Number one is that's a really great policy argument and that's the kind of debate that we should be having in the halls of Congress and all around the country in classrooms and churches and everywhere else. But those aren't arguments to say something is unconstitutional because it costs too much. Otherwise, you know, we'd be declaring wars unconstitutional and other things like that. And certainly, I don't think that's where the federal court power should lay.

And second thing is, just on that policy point, I think there's a real strong divergence of opinions. As I understand the CBO's projections, yes, the government is required to outlay some money, but in the end the whole thought is it saves a lot of money to American society because it encourages people, for example, to get preventive care so that they take care of themselves before you have the heart attack, before you have the diabetes, which is ultimately far more expensive to the American taxpayer and people.

MARTIN: And, finally, before we let you go, the lawsuit before the Supreme Court involves some 26 states who are opposing the law. There was a smattering of individuals, a business group and groups like the Cato Institute and so forth, a number of states have refused grant money or refused to set up insurance exchanges called for in the Affordable Care Act.

Can you envision a scenario where that might continue, even if the court upholds the law where a number of states might just not comply? And, if so, what happens then?

KATYAL: Well, I think that the terms of the Affordable Care Act do give the states a fair amount of wiggle room and to do things as they see fit. The Affordable Care Act was not designed as some sort of one size fits all solution from Washington. There's lots of discretion given to the states.

But on the kind of fundamental question, which is should our insurance companies be able to discriminate against those with preexisting conditions and thereby price out approximately 50 million Americans from the health insurance markets? The federal government and the Congress said no, you can't do that. That's something that we're not going to leave to the choice of individual states.

MARTIN: Neal Katyal is the former acting solicitor general of the United States. In that role, he defended the Affordable Care Act in lower courts. He's currently a professor at the Georgetown Law Center and a partner at the international law firm, Hogan Lovells in Washington, D.C. and we reached him there.

Mr. Katyal, professor, thank you so much for joining us.

KATYAL: Thank you.

MARTIN: We'll continue our conversation about the healthcare law on Monday as the Supreme Court begins hearing oral arguments and we hope you will join us. Transcript provided by NPR, Copyright NPR.

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