Justice Ginsburg | PPACA | Obamacare | Shared Responsibility Payment

Discussion in 'Judicial Interpretation' started by Dante, Jan 22, 2015.

  1. Dante
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    2 = “the broccoli horrible.”:alcoholic:

    Underlying THE CHIEF JUSTICE’s view that the Commerce Clause must be confined to the regulation of active participants in a commercial market is a fear that the commerce power would otherwise know no limits.
    See, e.g., ante, at 23 (Allowing Congress to compel an individual not engaged in commerce to purchase a product would “permi[t] Congress to reach beyond the natural extent of its authority, everywhere extending the sphere of its activity, and drawing all power into its impetuous vortex.”(internal quotation marks omitted)).

    The joint dissenters express a similar apprehension.
    See post, at 8 (If the minimum coverage provision is upheld under the commerce power then “the Commerce Clause becomes a font of unlimited power, . . . the hideous monster whose devouring jaws . . . spare neither sex nor age, nor high nor low,nor sacred nor profane.” (internal quotation marks omitted)). This concern is unfounded.

    First, THE CHIEF JUSTICE could certainly uphold the individual mandate without giving Congress carte blanche to enact any and all purchase mandates. As several times noted, the unique attributes of the health-care market render everyone active in that market and give rise to a significant free-riding problem that does not occur in other markets. See supra, at 3–7, 16–18, 21.

    Nor would the commerce power be unbridled, absent THE CHIEF JUSTICE’s “activity” limitation.
    Congress would remain unable to regulate noneconomic conduct that has only an attenuated effect on interstate commerce and is traditionally left to state law. See Lopez, 514 U. S., at 567; Morrison, 529 U. S., at 617–619.

    In Lopez, for example, the Court held that the Federal Government lacked power, under the Commerce Clause, to criminalize the possession of a gun in a local school zone. Possessing a gun near a school, the Court reasoned, “is in no sense an economic activity that might, through repetition elsewhere, substantially affect any sort of interstate commerce.” 514 U. S., at 567; ibid. (noting that the Court would have “to pile inference upon inference” to conclude that gun possession has a substantial effect on commerce). Relying on similar logic, the Court concluded in Morrison that Congress could not regulate gender-motivated violence, which the Court deemed to have too “attenuated [an] effect upon interstate commerce.” 529 U. S., at 615.

    An individual’s decision to self-insure, I have explained, is an economic act with the requisite connection to interstate commerce. See supra, at 16–17. Other choices individuals make are unlikely to fit the same or similar description.

    As an example of the type of regulation he fears, THE CHIEF JUSTICE cites a Government mandate to purchase green vegetables. Ante, at 22–23. One could call this concern “the broccoli horrible.” Congress, THE CHIEF JUSTICE posits, might adopt such a mandate, reasoning that an individual’s failure to eat a healthy diet, like the failure to purchase health insurance, imposes costs on others. See ibid.

    Consider the chain of inferences the Court would have to accept to conclude that a vegetable-purchase mandate was likely to have a substantial effect on the health-care costs borne by lithe Americans. The Court would have to believe that individuals forced to buy vegetables would then eat them (instead of throwing or giving them away),would prepare the vegetables in a healthy way (steamed or raw, not deep-fried), would cut back on unhealthy foods, and would not allow other factors (such as lack of exercise or little sleep) to trump the improved diet. [9]

    [9] The failure to purchase vegetables in THE CHIEF JUSTICE’s hypothetical, then, is not what leads to higher health-care costs for others; rather, it is the failure of individuals to maintain a healthy diet, and the resulting obesity, that creates the cost-shifting problem. See ante, at 22–23. Requiring individuals to purchase vegetables is thus several steps removed from solving the problem. The failure to obtain health insurance, by contrast, is the immediate cause of the cost-shifting Congress sought to address through the ACA. See supra, at 5–7. Requiring individuals to obtain insurance attacks the source of the problem directly, in a single step.

    Such “pil[ing of] inference upon inference” is just what the Court refused to do in Lopez and Morrison.
    Other provisions of the Constitution also check congressional overreaching. A mandate to purchase a particular product would be unconstitutional if, for example, the edict impermissibly abridged the freedom of speech, interfered with the free exercise of religion, or infringed on a liberty interest protected by the Due Process Clause.

    Supplementing these legal restraints is a formidable check on congressional power: the democratic process. See Raich, 545 U. S., at 33; Wickard, 317 U. S., at 120 (repeating Chief Justice Marshall’s “warning that effective restraints on [the commerce power’s] exercise must proceed from political rather than judicial processes” (citing Gibbons v. Ogden, 9 Wheat. 1, 197 (1824)).

    As the controversy surrounding the passage of the Affordable Care Act attests, purchase mandates are likely to engender political resistance. This prospect is borne out by the behavior of state legislators. Despite their possession of unquestioned authority to impose mandates, state governments have rarely done so. See Hall, Commerce Clause Challenges to Health Care Reform, 159 U. Pa. L. Rev. 1825, 1838 (2011).

    When contemplated in its extreme, almost any power looks dangerous. The commerce power, hypothetically,would enable Congress to prohibit the purchase and home production of all meat, fish, and dairy goods, effectively compelling Americans to eat only vegetables. Cf. Raich, 545 U. S., at 9; Wickard, 317 U. S., at 127–129. Yet no one would offer the “hypothetical and unreal possibilit[y],” Pullman Co. v. Knott, 235 U. S. 23, 26 (1914), of a vegetarian state as a credible reason to deny Congress the authority ever to ban the possession and sale of goods.

    THE CHIEF JUSTICE accepts just such specious logic when he cites the broccoli horrible as a reason to deny Congress the power to pass the individual mandate. Cf. R. Bork, The Tempting of America 169 (1990) (“Judges and lawyers live on the slippery slope of analogies; they are not supposed to ski it to the bottom.”). But see, e.g., post, at 3 (joint opinion of SCALIA, KENNEDY, THOMAS, and ALITO, JJ.) (asserting, outlandishly, that if the minimum coverage provision is sustained, then Congress could make “breathing in and out the basis for federal prescription”).​
     
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    3
    To bolster his argument that the minimum coverage provision is not valid Commerce Clause legislation, THE CHIEF JUSTICE emphasizes the provision’s novelty. See ante, at 18 (asserting that “sometimes the most telling indication of [a] severe constitutional problem . . . is the lack of historical precedent for Congress’s action” (internal quotation marks omitted)). While an insurance-purchase mandate may be novel, THE CHIEF JUSTICE’s argument certainly is not. “In almost every instance of the exercise of the [commerce] power differences are asserted from previous exercises of it and made a ground of attack.” Hoke v. United States, 227 U. S. 308, 320 (1913). See, e.g., Brief for Petitioner in Perez v. United States, O. T. 1970, No. 600, p. 5 (“unprecedented exercise of power”); Supplemental Brief for Appellees in Katzenbach v. McClung, O. T. 1964, No. 543, p. 40 (“novel assertion of federal power”); Brief for Appellee in Wickard v. Filburn, O. T. 1941, No. 59, p. 6 (“complete departure”).

    For decades, the Court has declined to override legislation because of its novelty, and for good reason.
    As our national economy grows and changes, we have recognized, Congress must adapt to the changing “economic and financial realities.” See supra, at 14–15. Hindering Congress’ ability to do so is shortsighted; if history is any guide, today’s constriction of the Commerce Clause will not endure. See supra, at 25–26.
     
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    III
    A
    For the reasons explained above, the minimum coverage provision is valid Commerce Clause legislation. See supra, Part II. When viewed as a component of the entire ACA, the provision’s constitutionality becomes even plainer.

    The Necessary and Proper Clause “empowers Congress to enact laws in effectuation of its [commerce] powe[r] that are not within its authority to enact in isolation.” Raich, 545 U. S., at 39 (SCALIA, J., concurring in judgment). Hence, “[a] complex regulatory program . . . can survive a Commerce Clause challenge without a showing that every single facet of the program is independently and directly related to a valid congressional goal.” Indiana, 452 U. S., at 329, n. 17. “It is enough that the challenged provisions are an integral part of the regulatory program and that the regulatory scheme when considered as a whole satisfies this test.” Ibid. (collecting cases). See also Raich, 545 U. S., at 24–25 (A challenged statutory provision fits within Congress’ commerce authority if it is an “essential par[t] of a larger regulation of economic activity,”such that, in the absence of the provision, “the regulatory scheme could be undercut.” (quoting Lopez, 514 U. S., at 561)); Raich, 545 U. S., at 37 (SCALIA, J., concurring in judgment) (“Congress may regulate even noneconomic local activity if that regulation is a necessary part of a more general regulation of interstate commerce.

    The relevant question is simply whether the means chosen are ‘reasonably adapted’ to the attainment of a legitimate end under the commerce power.” (citation omitted)).

    Recall that one of Congress’ goals in enacting the Affordable Care Act was to eliminate the insurance industry’s practice of charging higher prices or denying coverage to individuals with preexisting medical conditions. See supra, at 9–10. The commerce power allows Congress to ban this practice, a point no one disputes. See United States v. South-Eastern Underwriters Assn., 322 U. S. 533, 545, 552–553 (1944) (Congress may regulate “the methods by which interstate insurance companies do business.”).

    Congress knew, however, that simply barring insurance companies from relying on an applicant’s medical history would not work in practice. Without the individual mandate, Congress learned, guaranteed-issue and community-rating requirements would trigger an adverse-selection death-spiral in the health-insurance market: Insurance premiums would skyrocket, the number of uninsured would increase, and insurance companies would exit the market. See supra, at 10–11.

    When complemented by an insurance mandate, on the other hand, guaranteed issue and community rating would work as intended, increasing access to insurance and reducing uncompensated care.
    See supra, at 11–12.

    The minimum coverage provision is thus an “essential par[t] of a larger regulation of economic activity”; without the provision, “the regulatory scheme [w]ould be undercut.” Raich, 545 U. S., at 24–25 (internal quotation marks omitted). Put differently, the minimum coverage provision, together with the guaranteed issue and community-rating requirements, is “‘reasonably adapted’ to the attainment of a legitimate end under the commerce power”: the elimination of pricing and sales practices that take an applicant’s medical history into account. See id., at 37 (SCALIA, J., concurring in judgment).
     
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    B

    Asserting that the Necessary and Proper Clause does not authorize the minimum coverage provision, THE CHIEF JUSTICE focuses on the word “proper.”
    A mandate to purchase health insurance is not “proper” legislation, THE CHIEF JUSTICE urges, because the command “undermines the structure of government established by the Constitution.” Ante, at 28.

    If long on rhetoric, THE CHIEF JUSTICE’s argument is short on substance. THE CHIEF JUSTICE cites only two cases in which this Court concluded that a federal statute impermissibly transgressed the Constitution’s boundary between state and federal authority: Printz v. United States, 521 U. S. 898 (1997), and New York v. United States, 505 U. S. 144 (1992). See ante, at 29. The statutes at issue in both cases, however, compelled state officials to act on the Federal Government’s behalf. 521 U. S., at 925–933 (holding unconstitutional a statute obligating state law enforcement officers to implement a federal gun-control law); New York, 505 U. S., at 176–177 (striking down a statute requiring state legislators to pass regulations pursuant to Congress’ instructions). “[Federal] laws conscripting state officers,” the Court reasoned, “violate state sovereignty and are thus not in accord with the Constitution.” Printz, 521 U. S., at 925, 935; New York, 505 U. S., at 176.

    The minimum coverage provision, in contrast, acts“directly upon individuals, without employing the States as intermediaries.” New York, 505 U. S., at 164. The provision is thus entirely consistent with the Constitution’s design. See Printz, 521 U. S., at 920 (“[T]he Framers explicitly chose a Constitution that confers upon Congress the power to regulate individuals, not States.” (internal quotation marks omitted)).

    Lacking case law support for his holding, THE CHIEF JUSTICE nevertheless declares the minimum coverage provision not “proper” because it is less “narrow in scope” than other laws this Court has upheld under the Necessary and Proper Clause. Ante, at 29 (citing United States v. Comstock, 560 U. S. ___ (2010); Sabri v. United States, 541 U. S. 600 (2004); Jinks v. Richland County, 538 U. S. 456 (2003)).

    THE CHIEF JUSTICE’s reliance on cases in which this Court has affirmed Congress’ “broad authority to enact federal legislation” under the Necessary and Proper Clause, Comstock, 560 U. S., at ___ (slip op., at 5), is underwhelming.

    Nor does THE CHIEF JUSTICE pause to explain why the power to direct either the purchase of health insurance or, alternatively, the payment of a penalty collectible as a tax is more far-reaching than other implied powers this Court has found meet under the Necessary and Proper Clause.These powers include the power to enact criminal laws, see, e.g., United States v. Fox, 95 U. S. 670, 672 (1878); the power to imprison, including civil imprisonment, see, e.g., Comstock, 560 U. S., at ___ (slip op., at 1); and the power to create a national bank, see McCulloch, 4 Wheat., at 425. See also Jinks, 538 U. S., at 463 (affirming Congress’ power to alter the way a state law is applied in state court, where the alteration “promotes fair and efficient operation of the federal courts”). [10]

    [10] Indeed, Congress regularly and uncontroversially requires individuals who are “doing nothing,” see ante, at 20, to take action. Examples include federal requirements to report for jury duty, 28 U. S. C.§1866(g) (2006 ed., Supp. IV); to register for selective service, 50 U. S. C. App. §453; to purchase firearms and gear in anticipation of service in the Militia, 1 Stat. 271 (Uniform Militia Act of 1792); to turn gold currency over to the Federal Government in exchange for paper currency, see Nortz v. United States, 294 U. S. 317, 328 (1935); and tofile a tax return, 26 U. S. C. §6012 (2006 ed., Supp. IV).

    In failing to explain why the individual mandate threatens our constitutional order, THE CHIEF JUSTICE disserves future courts. How is a judge to decide, when ruling on the constitutionality of a federal statute, whether Congress employed an “independent power,” ante, at 28, or merely a “derivative” one, ante, at 29. Whether the power used is “substantive,” ante, at 30, or just “incidental,” ante, at 29? The instruction THE CHIEF JUSTICE, in effect, provides lower courts: You will know it when you see it.

    It is more than exaggeration to suggest that the minimum coverage provision improperly intrudes on “essential attributes of state sovereignty.” Ibid. (internal quotation marks omitted). First, the Affordable Care Act does not operate “in [an] are[a] such as criminal law enforcement or education where States historically have been sovereign.” Lopez, 514 U. S., at 564. As evidenced by Medicare, Medicaid, the Employee Retirement Income Security Act of1974 (ERISA), and the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Federal Government plays a lead role in the health-care sector, both as adirect payer and as a regulator.

    Second, and perhaps most important, the minimum coverage provision, along with other provisions of the ACA, addresses the very sort of interstate problem that made the commerce power essential in our federal system. See supra, at 12–14. The crisis created by the large number of U. S. residents who lack health insurance is one of national dimension that States are “separately incompetent” to handle. See supra, at 7–8, 13. See also Maryland Brief 15–26 (describing “the impediments to effective state policy making that flow from the interconnectedness of each state’s healthcare economy” and emphasizing that“state-level reforms cannot fully address the problems associated with uncompensated care”).

    Far from trampling on States’ sovereignty, the ACA attempts a federal solution for the very reason that the States, acting separately, cannot meet the need. Notably, the ACA serves the general welfare of the people of the United States while retaining a prominent role for the States. See id., at 31– 36 (explaining and illustrating how the ACA affords States wide latitude in implementing key elements of the Act’s reforms). [11]

    [11] In a separate argument, the joint dissenters contend that the minimum coverage provision is not necessary and proper because it was not the “only . . . way” Congress could have made the guaranteed-issue and community-rating reforms work. Post, at 9–10. Congress could also have avoided an insurance-market death spiral, the dissenters maintain, by imposing a surcharge on those who did not previously purchase insurance when those individuals eventually enter the health insurance system. Post, at 10. Or Congress could “den[y] a full income tax credit” to those who do not purchase insurance. Ibid. Neither a surcharge on those who purchase insurance nor the denial of a tax credit to those who do not would solve the problem created by guaranteed-issue and community-rating requirements. Neither would prompt the purchase of insurance before sickness or injury occurred.

     
    Last edited: Jan 23, 2015
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    IV

    In the early 20th century, this Court regularly struck down economic regulation enacted by the peoples’ representatives in both the States and the Federal Government. See, e.g., Carter Coal Co., 298 U. S., at 303–304, 309–310; Dagenhart, 247 U. S., at 276–277; Lochner v. New York, 198 U. S. 45, 64 (1905). THE CHIEF JUSTICE’s Commerce Clause opinion, and even more so the joint dissenters’ reasoning, see post, at 4–16, bear a disquieting resemblance to those long-overruled decisions. Ultimately, the Court upholds the individual mandate as a proper exercise of Congress’ power to tax and spend“for the . . . general Welfare of the United States.” Art. I, §8, cl. 1; ante, at 43–44.

    I concur in that determination, which makes THE CHIEF JUSTICE’s Commerce Clause essay all the more puzzling. Why should THE CHIEF JUSTICE strive so mightily to hem in Congress’ capacity to meet the new problems arising constantly in our ever developing modern economy? I find no satisfying response to that question in his opinion. [12]

    [12] THE CHIEF JUSTICE states that he must evaluate the constitutionality of the minimum coverage provision under the Commerce Clause because the provision “reads more naturally as a command to buy insurance than as a tax.” Ante, at 44. THE CHIEF JUSTICE ultimately concludes, however, that interpreting the provision as a tax is a “fairly possible” construction. Ante, at 32 (internal quotation marks omitted). That being so, I see no reason to undertake a Commerce Clause analysis that is not outcome determinative.

    But even assuming there were “practicable” alternatives to the minimum coverage provision, “we long ago rejected the view that the Necessary and Proper Clause demands that an Act of Congress be‘absolutely necessary’ to the exercise of an enumerated power.” Jinks v. Richland County, 538 U. S. 456, 462 (2003) (quoting McCulloch v. Maryland, 4 Wheat. 316, 414–415 (1819)). Rather, the statutory provision at issue need only be “conducive” and “[reasonably] adapted”to the goal Congress seeks to achieve. Jinks, 538 U. S., at 462 (internal quotation marks omitted). The minimum coverage provision meets this requirement. See supra, at 31–33.
     
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    V

    Through Medicaid, Congress has offered the States an opportunity to furnish health care to the poor with the aid of federal financing. To receive federal Medicaid funds, States must provide health benefits to specified categories of needy persons, including pregnant women, children, parents, and adults with disabilities. Guaranteed eligibility varies by category: for some it is tied to the federal poverty level (incomes up to 100% or 133%); for others it depends on criteria such as eligibility for designated state or federal assistance programs.

    The ACA enlarges the population of needy people States must cover to include adults under age 65 with incomes up to 133% of the federal poverty level. The spending power conferred by the Constitution, the Court has never doubted, permits Congress to define the contours of programs financed with federal funds. See, e.g., Pennhurst State School and Hospital v. Halderman, 451 U. S. 1, 17 (1981). And to expand coverage, Congress could have recalled the existing legislation, and replaced it with a new law making Medicaid as embracive of the poor as Congress chose.

    The question posed by the 2010 Medicaid expansion, then, is essentially this: To cover a notably larger population, must Congress take the repeal/reenact route, or may it achieve the same result by amending existing law?

    The answer should be that Congress may expand by amendment the classes of needy persons entitled to Medicaid benefits. A ritualistic requirement that Congress repeal and reenact spending legislation in order to enlarge the population served by a federally funded program would advance no constitutional principle and would scarcely serve the interests of federalism. To the contrary, such a requirement would rigidify Congress’ efforts to empower States by partnering with them in the implementation of federal programs.

    Medicaid is a prototypical example of federal-state cooperation in serving the Nation’s general welfare.


    Rather than authorizing a federal agency to administer a uniform national health-care system for the poor, Congress offered States the opportunity to tailor Medicaid grants to their particular needs, so long as they remain within bounds set by federal law. In shaping Medicaid,Congress did not endeavor to fix permanently the terms participating states must meet; instead, Congress reserved the “right to alter, amend, or repeal” any provision of the Medicaid Act. 42 U. S. C. §1304. States, for their part, agreed to amend their own Medicaid plans consistent with changes from time to time made in the federal law.See 42 CFR §430.12(c)(i) (2011). And from 1965 to the present, States have regularly conformed to Congress’ alterations of the Medicaid Act.

    THE CHIEF JUSTICE acknowledges that Congress may “condition the receipt of [federal] funds on the States’ complying with restrictions on the use of those funds,” ante, at 50, but nevertheless concludes that the 2010 expansion is unduly coercive. His conclusion rests on three premises, each of them essential to his theory.

    First,
    the Medicaid expansion is, in THE CHIEF JUSTICE’s view, a new grant program, not an addition to the Medicaid program existing before the ACA’s enactment. Congress, THE CHIEF JUSTICE maintains, has threatened States with the loss of funds from an old program in an effort to get them to adopt a new one.

    Second, the expansion was unforeseeable by the States when they first signed on to Medicaid.

    Third, the threatened loss of funding is so large that the States have no real choice but to participate in the Medicaid expansion. THE CHIEF JUSTICE therefore—for the first time ever—finds an exercise of Congress’ spending power unconstitutionally coercive.

    Medicaid, as amended by the ACA, however, is not two spending programs; it is a single program with a constant aim—to enable poor persons to receive basic health care when they need it. Given past expansions, plus express statutory warning that Congress may change the requirements participating States must meet, there can be no tenable claim that the ACA fails for lack of notice.

    Moreover, States have no entitlement to receive any Medicaid funds; they enjoy only the opportunity to accept funds on Congress’ terms. Future Congresses are not bound by their predecessors’ dispositions; they have authority to spend federal revenue as they see fit. The Federal Government, therefore, is not, as THE CHIEF JUSTICE charges, threatening States with the loss of “existing” funds from one spending program in order to induce them to opt into another program. Congress is simply requiring States to do what States have long been required to do to receive Medicaid funding: comply with the conditions Congress prescribes for participation.

    A majority of the Court, however, buys the argument that prospective withholding of funds formerly available exceeds Congress’ spending power. Given that holding, I entirely agree with THE CHIEF JUSTICE as to the appropriate remedy. It is to bar the withholding found impermissible—not, as the joint dissenters would have it, to scrap the expansion altogether, see post, at 46–48.

    The dissenters’ view that the ACA must fall in its entirety is a radical departure from the Court’s normal course. When a constitutional infirmity mars a statute, the Court ordinarily removes the infirmity. It undertakes a salvage operation;it does not demolish the legislation. See, e.g., Brockett v. Spokane Arcades, Inc., 472 U. S. 491, 504 (1985) (Court’s normal course is to declare a statute invalid “to the extent that it reaches too far, but otherwise [to leave the statute]intact”). That course is plainly in order where, as in this case, Congress has expressly instructed courts to leave untouched every provision not found invalid. See 42 U. S. C. §1303.

    Because THE CHIEF JUSTICE finds the withholding—not the granting—of federal funds incompatible with the Spending Clause, Congress’ extension of Medicaid remains available to any State that affirms its willingness to participate.
     
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    A
    Expansion has been characteristic of the Medicaid program. Akin to the ACA in 2010, the Medicaid Act as passed in 1965 augmented existing federal grant programs jointly administered with the States. [13] States were not required to participate in Medicaid. But if they did, the Federal Government paid at least half the costs. To qualify for these grants, States had to offer a minimum level of health coverage to beneficiaries of four federally funded, state-administered welfare programs: Aid to Families with Dependent Children; Old Age Assistance; Aid to the Blind;and Aid to the Permanently and Totally Disabled. See Social Security Amendments of 1965, §121(a), 79 Stat. 343; Schweiker v. Gray Panthers, 453 U. S. 34, 37 (1981). At their option, States could enroll additional “medically needy” individuals; these costs, too, were partially borne by the Federal Government at the same, at least 50%, rate. Ibid.

    [13] Medicaid was “plainly an extension of the existing Kerr-Mills” grant program. Huberfeld, Federalizing Medicaid, 14 U. Pa. J. Const. L. 431, 444–445 (2011). Indeed, the “section of the Senate report dealing with Title XIX”—the title establishing Medicaid—“was entitled,‘Improvement and Extension of Kerr-Mills Medical Assistance Program.’ ” Stevens & Stevens, Welfare Medicine in America 51 (1974)(quoting S. Rep. No. 404, 89th Cong., 1st Sess., pt. 1, p. 9 (1965)). Setting the pattern for Medicaid, Kerr-Mills reimbursed States for a portion of the cost of health care provided to welfare recipients if States met conditions specified in the federal law, e.g., participating States were obliged to offer minimum coverage for hospitalization and physician services. See Huberfeld, supra, at 443–444.
    Since 1965, Congress has amended the Medicaid program on more than 50 occasions, sometimes quite sizably. Most relevant here, between 1988 and 1990, Congress required participating States to include among their beneficiaries pregnant women with family incomes up to 133% of the federal poverty level, children up to age 6 at the same income levels, and children ages 6 to 18 with family incomes up to 100% of the poverty level. See 42 U. S. C. §§1396a(a)(10)(A)(i), 1396a(l); Medicare Catastrophic Coverage Act of 1988, §302, 102 Stat. 750; Omnibus Budget Reconciliation Act of 1989, §6401, 103 Stat. 2258; Omnibus Budget Reconciliation Act of 1990, §4601, 104 Stat.1388–166. These amendments added millions to the Medicaid-eligible population. Dubay & Kenney, Lessons from the Medicaid Expansions for Children and Pregnant Women 5 (Apr. 1997).

    Between 1966 and 1990, annual federal Medicaid spending grew from $631.6 million to $42.6 billion; state spending rose to $31 billion over the same period. See Dept. of Health and Human Services, National Health Expenditures by Type of Service and Source of Funds: Calendar Years 1960 to 2010 (table).[14] And between 1990 and 2010, federal spending increased to $269.5 billion. Ibid. Enlargement of the population and services covered by Medicaid, in short, has been the trend.
    Compared to past alterations, the ACA is notable for the extent to which the Federal Government will pick up the tab. Medicaid’s 2010 expansion is financed largely by federal outlays. In 2014, federal funds will cover 100% of the costs for newly eligible beneficiaries; that rate will gradually decrease before settling at 90% in 2020. 42 U. S. C. §1396d(y) (2006 ed., Supp. IV). By comparison,federal contributions toward the care of beneficiaries eligible pre-ACA range from 50% to 83%, and averaged 57% between 2005 and 2008. §1396d(b) (2006 ed., Supp. IV); Dept. of Health and Human Services, Centers for Medicare and Medicaid Services, C. Truffer et al., 2010 Actuarial Report on the Financial Outlook for Medicaid, p. 20.

    Nor will the expansion exorbitantly increase state Medicaid spending. The Congressional Budget Office (CBO )projects that States will spend 0.8% more than they would have, absent the ACA. See CBO, Spending & Enrollment Detail for CBO’s March 2009 Baseline. But see ante, at 44–45 (“[T]he Act dramatically increases state obligations under Medicaid.”); post, at 45 (joint opinion of SCALIA, KENNEDY, THOMAS, and ALITO, JJ.) (“[A]cceptance of the [ACA expansion] will impose very substantial costs on participating States.”). Whatever the increase in state obligations after the ACA, it will pale in comparison to the increase in federal funding. [15]

    [15] Even the study on which the plaintiffs rely, see Brief for Petitioners 10, concludes that “[w]hile most states will experience some increase in spending, this is quite small relative to the federal matching payments and low relative to the costs of uncompensated care that [the states]would bear if the[re] were no health reform.” See Kaiser Commission on Medicaid & the Uninsured, Medicaid Coverage & Spending in Health Reform 16 (May 2010). Thus there can be no objection to the ACA’s expansion of Medicaid as an “unfunded mandate.” Quite the contrary, the program is impressively well funded.
    Finally, any fair appraisal of Medicaid would require acknowledgment of the considerable autonomy States enjoy under the Act. Far from “conscript[ing] state agencies into the national bureaucratic army,” ante, at 55 (citing FERC v. Mississippi, 456 U. S. 742, 775 (1982) (O’Connor, J., concurring in judgment in part and dissenting in part) (brackets in original and internal quotation marks omitted)), Medicaid “is designed to advance cooperative federalism.” Wisconsin Dept. of Health and Family Servs. v. Blumer, 534 U. S. 473, 495 (2002) (citing Harris v. McRae, 448 U. S. 297, 308 (1980)).

    Subject to its basic requirements, the Medicaid Act empowers States to “select dramatically different levels of funding and coverage,alter and experiment with different financing and delivery modes, and opt to cover (or not to cover) a range of particular procedures and therapies. States have leveraged this policy discretion to generate a myriad of dramatically different Medicaid programs over the past several decades.” Ruger, Of Icebergs and Glaciers, 75 Law & Contemp. Probs. 215, 233 (2012) (footnote omitted). The ACA does not jettison this approach. States, as first-line administrators, will continue to guide the distribution of substantial resources among their needy populations. The alternative to conditional federal spending, it bears emphasis, is not state autonomy but state marginalization. [16]

    [16] In 1972, for example, Congress ended the federal cash-assistance program for the aged, blind, and disabled. That program previously had been operated jointly by the Federal and State Governments, as is the case with Medicaid today. Congress replaced the cooperative federal program with the nationalized Supplemental Security In- come (SSI) program. See Schweiker v. Gray Panthers, 453 U. S. 34, 38 (1981).

    In 1965, Congress elected to nationalize health coverage for seniors through Medicare. It could similarly have established Medicaid as an exclusively federal program. Instead, Congress gave the States the opportunity to partner in the program’s administration and development.

    Absent from the nationalized model, of course, is the state-level policy discretion and experimentation that is Medicaid’s hallmark; undoubtedly the interests of federalism are better served when States retain a meaningful role in the implementation of a program of such importance. See Caminker, State Sovereignty and Subordinacy, 95 Colum. L. Rev. 1001, 1002–1003 (1995) (cooperative federalism can preserve “a significant role for state discretion in achieving specified federal goals, where the alternative is complete federal preemption of any state regulatory role”); Rose-Ackerman, Cooperative Federalism and Co-optation, 92 Yale L. J. 1344, 1346 (1983) (“If the federal government begins to take full responsibility for social welfare spending and preempts the states, the result is likely to be weaker . . . state governments.”). [17]

    [17] THE CHIEF JUSTICE and the joint dissenters perceive in cooperative federalism a “threa[t]” to “political accountability.” Ante, at 48; see post, at 34–35. By that, they mean voter confusion: Citizens upset by unpopular government action, they posit, may ascribe to state officials blame more appropriately laid at Congress’ door. But no such confusion is apparent in this case: Medicaid’s status as a federally funded, state-administered program is hardly hidden from view.

    Although Congress “has no obligation to use its Spending Clause power to disburse funds to the States,” College Savings Bank v. Florida Prepaid Post secondary Ed. Expense Bd., 527 U. S. 666, 686 (1999), it has provided Medicaid grants notable for their generosity and flexibility. “Such funds,” we once observed, “are gifts,” id., at 686– 687, and so they have remained through decades of expansion in their size and scope.
     
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    The Spending Clause authorizes Congress “to pay the Debts and provide for the . . . general Welfare of the United States.” Art. I, §8, cl. 1. To ensure that federal funds granted to the States are spent “to ‘provide for the . . . general Welfare’ in the manner Congress intended,” ante, at 46, Congress must of course have authority to impose limitations on the States’ use of the federal dollars. This Court, time and again, has respected Congress’ prescription of spending conditions, and has required States to abide by them. See, e.g., Pennhurst, 451 U. S., at 17 (“[O]ur cases have long recognized that Congress may fix the terms on which it shall disburse federal money to the States.”). In particular, we have recognized Congress’ prerogative to condition a State’s receipt of Medicaid [/I]funding on compliance with the terms Congress set for participation in the program. See, e.g., Harris, 448 U. S., at 301 (“[O]nce a State elects to participate [in Medicaid], it must comply with the requirements of [the MedicaidAct].”); Arkansas Dept. of Health and Human Servs. v. Ahlborn, 547 U. S. 268, 275 (2006); Frew v. Hawkins, 540 U. S. 431, 433 (2004); Atkins v. Rivera, 477 U. S. 154, 156– 157 (1986).

    Congress’ authority to condition the use of federal funds is not confined to spending programs as first launched.The legislature may, and often does, amend the law, imposing new conditions grant recipients henceforth must meet in order to continue receiving funds. See infra, at 54 (describing Bennett v. Kentucky Dept. of Ed., 470 U. S. 656, 659–660 (1985) (enforcing restriction added five years after adoption of educational program)).

    Yes, there are federalism-based limits on the use of Congress’ conditional spending power. In the leading decision in this area, South Dakota v. Dole, 483 U. S. 203 (1987), the Court identified four criteria. The conditions placed on federal grants to States must (a) promote the “general welfare,” (b) “unambiguously” inform States what is demanded of them, (c) be germane “to the federal interest in particular national projects or programs,” and (d)not “induce the States to engage in activities that would themselves be unconstitutional.” Id., at 207–208, 210 (internal quotation marks omitted). [18]

    [18] Although the plaintiffs, in the proceedings below, did not contest the ACA’s satisfaction of these criteria, see 648 F. 3d 1235, 1263 (CA112011), THE CHIEF JUSTICE appears to rely heavily on the second criterion. Compare ante, at 52, 54, with infra, at 52–54.

    The Court in Dole mentioned, but did not adopt, a further limitation, one hypothetically raised a half-century earlier: In “some circumstances,” Congress might be prohibited from offering a “financial inducement . . . so coercive as to pass the point at which ‘pressure turns into compulsion.’” Id., at 211 (quoting Steward Machine Co. v. Davis, 301 U. S. 548, 590 (1937)). Prior to today’s decision, however, the Court has never ruled that the terms of any grant crossed the indistinct line between temptation and coercion.

    Dole involved the National Minimum Drinking Age Act, 23 U. S. C. §158, enacted in 1984. That Act directed the Secretary of Transportation to withhold 5% of the federal highway funds otherwise payable to a State if the State permitted purchase of alcoholic beverages by persons less than 21 years old. Drinking age was not within the authority of Congress to regulate, South Dakota argued, because the Twenty-First Amendment gave the States exclusive power to control the manufacture, transportation, and consumption of alcoholic beverages. The small percentage of highway-construction funds South Dakota stood to lose by adhering to 19 as the age of eligibility to purchase 3.2% beer, however, was not enough to qualify as coercion, the Court concluded.

    This case does not present the concerns that led the Court in Dole even to consider the prospect of coercion. In Dole, the condition—set 21 as the minimum drinking age—did not tell the States how to use funds Congress provided for highway construction. Further, in view of the Twenty-First Amendment, it was an open question whether Congress could directly impose a national minimum drinking age.

    The ACA, in contrast, relates solely to the federally funded Medicaid program; if States choose not to comply, Congress has not threatened to withhold funds earmarked for any other program. Nor does the ACA use Medicaid funding to induce States to take action Congress itself could not undertake. The Federal Government undoubtedly could operate its own health-care program for poor persons, just as it operates Medicare for seniors’ healthcare. See supra, at 44.

    That is what makes this such a simple case, and the Court’s decision so unsettling.
    Congress, aiming to assist the needy, has appropriated federal money to subsidize state health-insurance programs that meet federal standards. The principal standard the ACA sets is that the state program cover adults earning no more than 133% of the federal poverty line. Enforcing that prescription ensures that federal funds will be spent on health care for the poor in furtherance of Congress’ present perception of the general welfare.​
     
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    THE CHIEF JUSTICE asserts that the Medicaid expansion creates a “new health care program.” Ante, at 54. Moreover, States could “hardly anticipate” that Congress would “transform [the program] so dramatically.” Ante, at 55. Therefore, THE CHIEF JUSTICE maintains, Congress’ threat to withhold “old” Medicaid funds based on a State’s refusal to participate in the “new” program is a “threa[t] to terminate [an]other . . . independent gran[t].” Ante, at 50, 52–53. And because the threat to withhold a large amount of funds from one program “leaves the States with no real option but to acquiesce [in a newly created program],” THE CHIEF JUSTICE concludes, the Medicaid expansion is unconstitutionally coercive. Ante, at 52.
     
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    The starting premise on which THE CHIEF JUSTICE’s coercion analysis rests is that the ACA did not really“ extend” Medicaid; instead, Congress created an entirely new program to co-exist with the old.

    THE CHIEF JUSTICE calls the ACA new, but in truth, it simply reaches more of America’s poor than Congress originally covered.
    Medicaid was created to enable States to provide medical assistance to “needy persons.” See S. Rep. No. 404, 89th Cong., 1st Sess., pt. 1, p. 9 (1965). See also §121(a), 79 Stat. 343 (The purpose of Medicaid is to enable States“to furnish . . . medical assistance on behalf of [certain persons] whose income and resources are insufficient to meet the costs of necessary medical services.”). By bringing health care within the reach of a larger population of Americans unable to afford it, the Medicaid expansion is an extension of that basic aim.

    The Medicaid Act contains hundreds of provisions governing operation of the program, setting conditions ranging from “Limitation on payments to States for expenditures attributable to taxes,” 42 U. S. C. §1396a(t) (2006 ed.), to “Medical assistance to aliens not lawfully admitted for permanent residence,” §1396b(v) (2006 ed. and Supp.IV). The Medicaid expansion leaves unchanged the vast majority of these provisions; it adds beneficiaries to the existing program and specifies the rate at which States will be reimbursed for services provided to the added beneficiaries. See ACA §§2001(a)(1), (3), 124 Stat. 271–272.The ACA does not describe operational aspects of the program for these newly eligible persons; for that information, one must read the existing Medicaid Act. See 42
    U. S. C. §§1396–1396v(b) (2006 ed. and Supp. IV).

    Congress styled and clearly viewed the Medicaid expansion as an amendment to the Medicaid Act, not as a “new” health-care program. To the four categories of beneficiaries for whom coverage became mandatory in 1965, and the three mandatory classes added in the late 1980’s, see supra, at 41–42, the ACA adds an eighth: individuals under 65 with incomes not exceeding 133% of the federal poverty level. The expansion is effectuated by §2001 of the ACA, aptly titled: “Medicaid Coverage for the Lowest Income Populations.” 124 Stat. 271. That section amends Title 42, Chapter 7, Subchapter XIX: Grants to States fo rMedical Assistance Programs. Commonly known as the Medicaid Act, Subchapter XIX filled some 278 pages in 2006. Section 2001 of the ACA would add approximately three pages. [19]

    [19] Compare Subchapter XIX, 42 U. S. C. §§1396–1396v(b) (2006 ed. and Supp. IV) with §§1396a(a) (10)(A)(i)(VIII) (2006 ed. and Supp. IV); 1396a(a) (10)(A)(ii)(XX), 1396a(a)(75), 1396a(k), 1396a(gg) to (hh),1396d(y), 1396r–1(e), 1396u–7(b)(5) to (6).

    Congress has broad authority to construct or adjust spending programs to meet its contemporary understanding of “the general Welfare.” Helvering v. Davis, 301 U. S. 619, 640–641 (1937). Courts owe a large measure of respect to Congress’ characterization of the grant programs it establishes. See Steward Machine, 301 U. S., at 594. Even if courts were inclined to second-guess Congress’ conception of the character of its legislation, how would reviewing judges divine whether an Act of Congress, purporting to amend a law, is in reality not an amendment,but a new creation? At what point does an extension become so large that it “transforms” the basic law?

    Endeavoring to show that Congress created a new program, THE CHIEF JUSTICE cites three aspects of the expansion. First, he asserts that, in covering those earning no more than 133% of the federal poverty line, the Medicaid expansion, unlike pre-ACA Medicaid, does not “care for the neediest among us.” Ante, at 53. What makes that so? Single adults earning no more than $14,856 per year—133% of the current federal poverty level—surely rank among the Nation’s poor.

    Second,
    according to THE CHIEF JUSTICE, “Congress mandated that newly eligible persons receive a level of coverage that is less comprehensive than the traditional Medicaid benefit package.” Ibid. That less comprehensive benefit package, however, is not an innovation introduced by the ACA; since 2006, States have been free to use it for many of their Medicaid beneficiaries. [20]

    [20] The Deficit Reduction Act of 2005 authorized States to provide“benchmark coverage” or “benchmark equivalent coverage” to certain Medicaid populations. See §6044, 120 Stat. 88, 42 U. S. C. §1396u–7(2006 ed. and Supp. IV). States may offer the same level of coverage to persons newly eligible under the ACA. See §1396a(k).

    The level of benefits offered therefore does not set apart post-ACA Medicaid recipients from all those entitled to benefits pre-ACA.

    Third, THE CHIEF JUSTICE correctly notes that the reimbursement rate for participating States is different regarding individuals who became Medicaid-eligible through the ACA. Ibid. But the rate differs only in its generosity to participating States. Under pre-ACA Medicaid, the Federal Government pays up to 83% of the costs of coverage for current enrollees, §1396d(b) (2006 ed. and Supp. IV); under the ACA, the federal contribution starts at 100% and will eventually settle at 90%, §1396d(y). Even if one agreed that a change of as little as 7 percentage points carries constitutional significance, is it not passing strange to suggest that the purported incursion on state sovereignty might have been averted, or at least mitigated, had Congress offered States less money to carry out the same obligations?

    Consider also that Congress could have repealed Medicaid. See supra, at 38–39 (citing 42 U. S. C. §1304); Brief for Petitioners in No. 11–400, p. 41. Thereafter, Congress could have enacted Medicaid II, a new program combining the pre-2010 coverage with the expanded coverage required by the ACA. By what right does a court stop Congress from building up without first tearing down?
     

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