Rob Natelson Obamacare Ruling Renders Republican Health Care Bill Unconstitutional

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Eminent legal scholar Rob Natelson, whose work on the inherent limitations of federal power has been cited often in recent Supreme Court decisions, “now writes that the Supreme Court’s ruling last year on Obamacare renders a bill proposed by House Republicans to limit medical liability unconstitutional. To remind my regular readers, Rob Natelson is the Senior Fellow in Constitutional Jurisprudence for the libertarian-leaning Independence Institute in Colorado and an expert on the original meaning of the Constitution. He co-authored an important amicus brief on the “Necessary and Proper Clause” of the Constitution for the Obamacare case, which is cited by other anti-Obamacare legal experts. I’ve written often here on his work on the unconstitutionality of federal limits on damages in medical malpractice lawsuits. So his conclusion in his new work on the impact of the Obamacare decision on proposed federal medical liability limits should strike a serious blow to efforts to push the bill.

He analyzed Title V of H.R. 3121, the “American Health Reform Act” (hereinafter “AHRA”), and concludes that “for Congress to start micro-managing state courts and state juries should frighten anyone who cares about our American constitutional system.” Natelson briefly describes the bill’s key features: “The bill would rewrite personal injury law extensively–and not just in federal courts administering federal law. It would intrude on state courts applying state law. For example, the bill requires state judges and juries to adopt federal standards of proof, federal standards of guilt, federal damage rules, and federal deadlines. It imposes rules for attorneys’ fees that override both state law and private contracts. It even mandates that some useful information be withheld from juries.”

Natelson first points out that the Founders always intended “that state civil justice systems and tort law would remain free of federal control,” and assertions that the Commerce Clause can be used to justify federal limits on medical liability are not based on original intent. “In 2011, I investigated the issue thoroughly, and reported my findings in a detailed paper entitled The Roots of American Judicial Federalism, available at http://constitution.i2i.org/files/2011/11/Roots_Am_Federalism.pdf… That paper showed that (1) a core reason the Founders fought the American Revolution was to assure local control of courts, (2) the Constitution was structured to achieve the same goal, and (3) leading Founders specifically represented–not merely once or twice, but again and again–that state civil justice systems and tort law would remain free of federal control. Despite a few half-hearted assertions to the contrary, the paper’s conclusions have never been seriously challenged.”

Natelson then discusses why the Obamacare ruling further precludes federal medical liability limits. He reviews the history of the “the other component of the Commerce Power,” the “Necessary and Proper Clause” in Article I, Section 8, Clause 18. He then describes the limits on Congressional power in two important rulings:

The leading Supreme Court case on the Necessary and Proper Clause is McCulloch v. Maryland. In that case, Chief Justice John Marshall also explained that the Clause did not grant to Congress any ‘great substantive and independent powers.’ Moreover, in Gibbons v. Ogden (the first great Commerce Power case) Marshall added that ‘health laws of every description’ were outside the federal sphere and exclusively reserved to the states. In other words, under the view of the greatest chief justice in American history, both Title V and Obamacare are utterly unconstitutional.”

Natelson then quotes from Chief Justice Roberts’ ruling that the Obamacare individual mandate violates the Necessary and Proper Clause: The clause “‘does not license the exercise of any “great substantive and independent power[s]’ beyond those specifically enumerated. . . . Instead, the Clause is merely a declaration, for the removal of all uncertainty, that the means of carrying into execution those [powers] otherwise granted are included in the grant. . . . [T]he individual mandate cannot be sustained under the Necessary and Proper Clause as an essential component of the insurance reforms.”

Natelson then applies Justice Roberts’ reasoning to the proposed federal override in the AHRA of state tort law, concluding that proposal is unconstitutional:

Is control of the state court systems a ‘great substantive and independent power?’ You bet it is. The Founders clearly considered the judiciary a very important aspect of government, and the Constitution addressed it in detail. But while prescribing the rules for the federal courts, the framers deliberately omitted any federal role in the state judiciary… The Founders obviously deemed judicial organization and procedure to be a ‘great and independent’ subject, worthy of much constitutional attention. Yet in all procedural and organizational particulars, they left state courts alone. They certainly granted Congress no power to micro-manage them. They left the ‘great substantive and independent power’ of operating the state courts to the states themselves. Under Justice Roberts’ opinion, that’s where it stays.”

Natelson adds that Chief Justice Roberts’ additional ruling that the forced Medicaid expansion in Obamacare violates state sovereignty “buttresses” his conclusion. “As in previous cases, the Court held that ‘commandeering’ infringes core state sovereignty. Infringing core state sovereignty violates the Necessary and Proper Clause because a federal law attacking core state sovereignty is not ‘proper.’ A federal statute dictating to state legislatures, judges, and juries how they manage lawsuits arising under their own state law is of that kind.”

And what of the section in the AHRA titled, “State Flexibility and Protection of States’ Rights?” Natelson dismisses the title as “misleading” and determines that, “In other words, a state may be ‘flexible’ if it does what Congress likes, but not what Congress doesn’t like.”

Robert Natelson joins fellow anti-Obamacare legal expert Prof. Randy Barnett, who said after the SCOTUS Obamacare ruling that, “I will help lead that challenge if ever enacted, and I think we would actually have an easier time defeating that than defeating the (Obamacare) mandate… In fact, this court would strike that down (referring to federal medmal limits)… I’ll be involved in the lawsuit.”

Republicans who oppose Obamacare and truly intend to uphold the original intent of the Constitution should heed Robert Natelson’s warning that they would be supporting an equally unconstitutional exercise of federal power over the states, and they should oppose the bill.

N.B. In recent months, supporters of federal limits on medical liability have pointed to a November 2012 paper written by Paul Clement, who presented the case against Obamacare before the Supreme Court, as proof that the federal liability limits are allowable under the Commerce Clause. However, in his paper Mr. Clement never discussed the impact of the Obamacare opinion on the issue of federal medical liability limits.