Wednesday, March 28, 2012

Would You Like Broccoli With That Health Insurance Plan? The Supremes Discuss The Slippery Slope Of ObamaCare

Broccoli, cell phones and burial services, oh my! What will the government force us to buy next? The parade of horribles was the topic du jour at Tuesday's oral argument before the US Supreme Court on the constitutionality of the individual mandate contained in the Affordable Care Act. The Supremes expressed concern over the slippery slope potentially created by the ACA and where the line should be drawn. At issue is whether the individual mandate of the ACA is authorized by the United States Constitution art. 1 sec. 8 clause 3, the Commerce Clause, which gives Congress the power to regulate interstate commerce. The Supreme Court has, over the past 190 years, interpreted the Commerce Clause to allow congress to regulate all sorts of industries, from ship navigation, to the Chicago meat industry, to wheat production for personal use.

Justice Scalia, notorious for his conservative legal opinions, asked the first question of Solicitor General Donald Verrilli, setting the tone for the day. Scalia queried, perhaps disingenuously, why couldn't the federal government just directly address the problems of individual access to health care rather than the individual mandate to purchase health insurance. The answer of course, is that the present Congress will not create a public health care option. Appropriately, Mr. Verrilli did not give this answer, but offered instead that the ACA is in fact addressing the problem directly.

The Justices' questions centered around the concern that if Congress can require individuals to purchase health care, why can't Congress require the purchase of a cell phone, of broccoli, of health club memberships or of funeral services? Verrilli;s answer to these questions pointed out the health care market is different because (a) it is the only market where you can show up without the means to pay and you will still be provided the service at the expense of those who do pay; (b) everyone will eventually need health care and thus everyone is a market participant; (c) the ACA seeks to regulate the health care industry, not the insurance industry, and requires the method of payment for health care be through health insurance; (d) the ACA uses the most efficient method that allows consumer choice among insurance policies; and (e) the ACA does not provide any enforcement powers--if insurance is not purchased, the penalty is not anymore than what one would have paid for the insurance.

The respondents arguing to strike the mandate did not have any easier a time with the Justices. Attorney Paul Clemente, arguing for the respondent 26 states, argued the ACA forces individuals to purchase a product. Clemente argued that defining the market as those who access health care was improper, and that the market being regulated was those that purchased insurance. Clemente suggested it would be constitutional for the ACA instead to only require that insurance be purchased at the point of sale; i.e. only when one gets sick and shows up to the Emergency Room. The Justices focused their questions to Clemente on issues regarding the definition of the market being regualted (insurance versus health care), the fact that uninsured patients already shift the cost of their health care to paying patients, and what difference does it make if the ACA requires the purchase of insurance prior to getting sick or at the time of receiving health care services.

Justice Breyer proposed a hypothetical situation several times to the respondent attorneys, asking, what if "a disease is sweeping the United States, and 40 million people are susceptible, of whom 10 million will die; can't the federal Government say all 40 million get inoculated?" Mr. Clemente avoided answering, which perhaps accounts for Justice Breyer's attempt three more times to get an answer. Justice Breyer then changed the hypothetical to whether the EPA could require all automobiles have anti pollution equipment if it turned out 60% of them caused pollution. Attorney Carvin conceded the commerce clause authorized Congress to enact such a law but pointed out only those who bought automobiles would be required to do so.

The problem with the respondents' argument is they attempt to limit the individuals affected in the market being regulated by the ACA to those purchasing insurance, leading to their protest that Congress is requiring an affirmative purchase of a product that would not otherwise be purchased. To hear the respondents say it, the 40 million uninsured are uninsured by choice, rather than because they cannot afford the premiums, and thus should not be forced to purchase an unwanted product. Justice Ginsberg's comparison of the ACA to the social security system is well taken, albiet, social security is funded by a tax, making it a different animal. The truth is, as many of the Justices pointed out, every person from the time they are born will at some point need to use health care. That is the industry that the ACA targets. The ACA mandates that health care is paid for by insurance, which the respondents concede is a proper Congressional power under the commerce clause. As Justice Kennedy pointed out, "the young [healthy] person is uniquely proximately very close to affecting the rates of insurance and the costs of providing medical care in a way that s not true in other industries." Thus their participation directly affects the price others will pay not just for insurance, but for health care. Health care costs go up because hospitals are required by federal law to treat those who cannot pay for their services, thus shifting the costs to everyone else. The respondents' solution that those who "choose" not to purchase insurance can be required to purchase it at the time they do need health cares serices, is not only unreasonable and naive, but implausible.

As Mr. Vermilli pointed out, 40 million Americans can not obtain health care insurance because of the cost of the premiums. If a point of sale requirement were placed on these individuals as argued by the respondents, the cost of insurance would essentially be the cost of the health service. Actuarially, the premium you pay is based on some calculus of the chance you will get sick and how much the health care you might need could cost. If someone shows up at the Emergency Room and endeavors to purchase insurance then and there, the chance that you will get sick is 100% because you are currently sick, and the cost is more or less calculable. So, the premium, from an actuarial point of view and the point of view of the insurance company should be the cost of the treatment you are seeking. Which brings us back to the uninsured showing up to the Emergency Room with no means of paying The cost would still be shifted to others with insurance.


Tuesday, March 27, 2012

Obama Care Oral Arguments Underway

On Monday, March 26, 2012, oral arguments in front of the United States Supreme Court got underway to hear the legal challenge to the Affordable Care Act enacted by Congress and signed into law by President Obama on March 23, 2010.

The Supreme Court scheduled an unprecedented six hours over three days for oral argument this week after granting certiorari. At issue is the Act's individual mandate to purchase health insurance or pay a tax penalty. two federal appellate courts have upheld the mandate, one declared it unconstitutional and one appellate court declined to decide the issue under the Anti-Injunciton Act, ruling the issue could not be decided until tax payers are actually harmed by having to pay the tax/penalty in 2015.

Monday's oral argument focused mainly on whether the Anti-Injunction Act prohibited the present challenge, and whether the requirement that a tax payer who fails to purchase health insurance is assessed a tax or a penalty, which would dictate whether the AIA applies. There was discussion between the Justices and amicus curiae court appointed counsel Robert A. Long whether the Anti-Injunction Act is jurisdictional, thus robbing the courts of the ability to hear the issue, or directed at the Solicitor General, thus prohibiting the litigants from filing suit.

Nomenclature was an issue regarding whether the assessment is actually a tax or a penalty. Right out of the box, Justice Alito quipped to the Solicitor General for the Department of Justice Donald B. Verrilli, "General Verrilli, today you are arging that the penalty is not a tax. Tomorrow You are going to be back and you will be arguing that the penalty is a tax." When Chief Justice Roberts referred to the assessment as a penalty, attorney for challengers to the Act, Gregory G. Katsas, corrected "taxes, Mr. Chief Justice."

The attorneys were peppered with questions mainly from Ginsberg, Scalia, Sotomayor, Breyer, Roberts and Kegan, with a few questions from Alito and Kennedy. Thomas remained characteristically silent during argument.


Tuesday, March 20, 2012

Me and 500 of My Facebook BFFs: A Rambling Stream of Consciousness About Facebook

Okay, so this post is not a legal update. So sue me. Just accept that you will see more nonlegal posts interspersed among my legal analyses from now on.

The other morning I was thinking about how on-line banks and financial institutions these days are requiring users to answer “security questions” to verify identity and keep identity theft at bay.  It then occurred to me,that on-line social sites such as Facebook put their users at risk, because they encourage people to share in a public setting the personal information banks use to verify one’s identity. Perhaps people should not be using Facebook the way we all do because many of the answers to the “security questions” used most often can be found on the Wall of one’s  Facebook page. For example, my home town, my high school, a list of my family members, and now with the new timeline, my job history and places I have lived and the respective dates are all posted for anyone to which I give access to find.  Thus, security questions like mother’s maiden name, city you were born in, first pet’s name, first employer, or even high school mascot  all potentially could easily be found with not too much effort.   To put this in perspective, if one’s security setting allows only friends of friends to see wall posts and information, and one has,  say, 500 friends, each of who have 500 friends, one’s “security” information is potentially accessible to tens of thousands of people.

But maybe the flaw isn’t in the information Facebook has lulled us into voluntarily posting on our accounts, or even in Facebook’s privacy settings.  Yes, I know, this is antithetical to the Facebook bashing of late and accusations that Facebook intentionally makes it difficult to control one’s privacy settings. But it is not as if the type of information posted on Facebook is super secret stuff like one’s social security number. With all the conspiracy theories about Facebook, I have yet to see an accusation that Facebook is gathering social security numbers, ATM PINs, or bank account information.  Realistically, the type of information contained on my Facebook wall is information I would have no problem sharing with a complete stranger I just met.  The usual mindless, boring, get-to-know-you chitchat is not infrequently comprised of where one was born, what high school one attended or what type of embarrassing first car one owned.  I am not often concerned nor do I even consider that the person with whom I might share this type of information is going to steal my identity.  So maybe the flaw isn’t Facebook.  Maybe the real flaw is the type of questions the bank considers “security” inducing.  Maybe the banks should be asking stuff that we do tend to keep super secret, such as what loathsome diseases one has, or one’s criminal history, annual income, number of late payments in the past twelve months.  Maybe using information we would divulge just to be social is not fodder for a security question to verify our identity. After all, it is those mundane details about one’s self that we use to socialize and with which we make friends with one another.  So, maybe Facebook has it right after all.

So, maybe the problem is the number of people we friend on Facebook.   Do we really need to friend everyone we ever knew and his brother?  Do we really have 500 bffs in this world?  Before on-line social networks, we made friends the old fashioned way; we hung out with them.  According to research conducted by the likes of Festinger (1954), Schachter and Back (1950), and Zajonc (1968), the one factor that most predicted whether two people became friends is propinquity.  Throughout different stages of our lives, we share propinquity with different sets of people: the kids on our street in elementary school; the kids in our class in high school; the kids in our dorms in college; the colleagues and/or neighbors we have as young adults; the people who parent the kids that hang out with our kids; and perhaps inevitably, the people whose rooms are next to ours in the nursing home.

As we moved along life, we drop some friends, keep in touch with a select few, and move on to a new set of friends. Part of what keeps us friends is being in close enough geographic proximity to one another so that we may share the little mundane things about our lives.  For example,“Oh! Did I tell you what so-and-so’s response was to my letter (email post 1990s)?” or “My wife wants me to take her to another bad 70’s/80’s/90’s band/concert this weekend.  Wanna come?” or “Dude, I want a rematch on that racquet ball game last week.”  If we didn’t have this semi regular discourse, most people who were in our circle fell out, with the exception of the one or two with whom we kept in touch regardless of where we were in life or where we moved geographically.

Facebook has really changed all that.  Not only do we keep in contact with more people, perhaps people we would even be happier to have lost contact with, but we are kept up to date on all those mundane details on a regular basis.  We post our status constantly. “Made it to the gym today, did 50 push ups, my personal best.” Or “My three year old knocked out his front tooth.” Or “I was offered a new job at Local Big Firm.” Propinquity is now present not only in real space, but in cyberspace.  I was keenly made aware of this revelation when I updated my own status last week to announce my accepting a job offer at Local Big Firm.  I received comments or “likes” from somewhere around 50 separate people.  In my life, I have never had 50 people in anyone circle of friends to which I would have made this announcement and in return received so many heart warming good wishes.  And of course, these 50 people don’t include those closest to me who don’t even have (gasp!) a Facebook account!  When I saw (what I consider) the large number of good wishes, I started thinking about what the 217 people I have friended on Facebook really mean to me. Like many, my (modest) Facebook posse consists of friends and acquaintances from: elementary school, high school, college, neighbors from old addresses, work, family, present neighbors, friends/acquaintances, friends/acquaintances made because of my kids’ friends, and all their brothers. Surely I don’t have 217 bffs, do I??  The propinquity theory dispels this, doesn’t it? I don’t have regular contact and/or discourse with 217 people, except in cyberspace. Can the propinquity theory be applied to cyberspace?  The answer is yes.  Propinquity explains cyberspace just as well as real space.

Here’s the thing.  Facebook gives us the tool to create propinquity in cyberspace.  I had an epiphany that brought this conclusion into focus for me.  I have a friend Matt E. from college (not to be confused with my close friend Matt G. from grad school).  Matt E. and I were close friends in college and for a few years after until our lives diverged.  He got married, I moved to go to grad school.  I haven’t actually seen Matt E. in person since Bush Sr. was President.  If not for Facebook, I likely would never have (recently) gotten back “in touch” with Matt.  By Facebook standards, “in touch” means we friended each other and said something like, “Long time no see!” and left it at that beyond public status updates. But I have read Matt’s status updates and posts.  I was updated on his trip to Korea and saw pictures of his college-aged daughter I have never met.  And presumably, Matt has seen my posts about my latest work-out session personal bests and has seen pictures of my five year old’s cut finger that resulted to an ER visit, along with the other 216 Facebook friends I have. 

Here’s how my epiphany went.  After making my post about my new job, Matt made a short, tongue-in-cheek comment that reminded me just how well he knew/knows me.  That short comment bridged both time and space to bring him back, if only briefly, to being one of my closest friends. Without Facebook, that would never have happened. Without Facebook, I might have looked him up on a trip back home. Maybe.  I might have suggested that we grab lunch. We might have spent the two hours “catching up.” “So, how’s your daughter? In college?? Really???” and that would have been that for another ten or twenty years, if we were lucky. Facebook dispenses the small talk we engage in on a semi regular basis when we are in proximity to each other and that brings us together and keeps us friends.  Even if we don’t act on the information posted to Facebook, e.g., “How was your trip to Korea?” (and really, Facebook relieves us of that social requisite of feigning interest in some subjects), nonetheless, it keeps us friends.  So when Matt thinks of something short and witty to say to me that he knows only I will get, time and space don’t get in the way of him making that comment to me. All he need do is click on my post and type a comment.  Just like that, we shared an inside joke between two friends.  So yeah, I really do have 217, give or take, bffs. Facebook, and all it’s evil information-gathering, makes it possible for me to do so.

So, really, it’s the banks that need to come up with some other way to make our on-line banking more secure. Using mundane facts to put up firewalls to our financial information is just a dumb idea, even without Facebook putting it all out there.