Michael E. Rosman
General Counsel, The Center for Individual Rights
Under the Necessary & Proper Clause, Congress has the power "to make all laws which shall be necessary and proper for carrying into execution the foregoing powers." The N&P Argument for the individual mandate is fairly straightforward, and perhaps the government's best argument. Congress relied on its Commerce Clause authority to regulate insurance company practices in the individual market, requiring the companies to adhere to "guaranteed issue" and "community rating" principles. (Everyone gets a policy and those with health issues cannot be charged more because of them.) With those principles, the argument goes, people might wait until they get sick before buying a policy; with only the sick buying policies, the costs to insurers will skyrocket and they will charge more for each policy, making the policies themselves much more expensive. The individual mandate precludes people from gaming the system like that, and thus is a "necessary and proper" addition to the insurance company regulations.
To this, the challengers reply that Congress cannot create the problem that requires fixing, or its powers would be unlimited. As the private challengers noted, Congress could "compel the purchase of any product burdened in any way by federal regulation, which is every product." The challengers and their amici focused on the requirement that laws must be "for carrying into execution the foregoing powers." One can fully execute a law by eliminating barriers to its enforcement, not by regulating third parties outside of the original regulation who can help lower the burdens of that initial law. They argue that the insurance company regulations (and, thus, Congress's Commerce Clause authority) could be perfectly executed without the individual mandate. The N&P Clause may give Congress the authority to punish insurers who fail to comply with its regulations, but it does not give Congress the authority to regulate outside of the enumerated powers solely to make the insurance regulations more desirable.
The authors of a recent scholarly book on the history and origins of the N&P Clause added their own enlightening amicus brief. According to them, the "necessary" requirement meant an "inferior" power deemed a necessary or customary means of executing a greater power - e.g., creating a national bank to collect revenues and make expenditures or adopting criminal laws or civil fines to deter violation of another law. The "proper" requirement invoked certain kinds of fiduciary responsibilities like impartiality and good faith. Under the proper understanding of the clause, they argued, the "individual mandate" failed to meet either requirement.
So the Court has much to choose from in analyzing whether the individual mandate is justified under the Necessary & Proper Clause. We can only hope that its decision will at least address some of the arguments noted here.
* * *
I want to close by responding briefly to Professor Metzger's suggestion that the Court cannot declare the statute facially unconstitutional under its precedents. This ignores the unique posture of Commerce Clause cases in which Congress's power to regulate activities "substantially affecting commerce" are decided. As Professor Metzger's well-known Columbia Law Review article itself noted, the Court's "class of activities" test in that area has rendered as-applied challenges "in practice impossible." (105 Col. L. Rev. at 906.) Moreover, Alfonso Lopez was actually being paid to deliver a gun and Christy Brzonkala (the private plaintiff in Morrison) argued strenuously that the statute there could be upheld as applied because it affected financial transactions she would have made with her college. If the Court ignores any "as applied" possibilities here, it will be nothing new. To the contrary, it will be consistent with its practice in this area.
Thanks to Point of Law and the Manhattan Institute for letting me participate in this excellent discussion!