The elephant in the courtroom

Those who still believe in our Constitution’s restraints on federal power were rightly delighted by Friday’s 11th Circuit decision striking down the individual mandate in Obama’s health care law. The part of the opinion that deals with the individual mandate is masterful and exhaustive, running to some 89 pages.

But the constitutionality of the individual mandate wasn’t the only issue on appeal before the court. There was another important constitutional issue: whether the federal government can require states to expand their Medicaid programs as a condition of continuing to receive federal Medicaid funds. Here the court gave short shrift, a perfunctory treatment of only 14 pages that it could have copied from any constitutional law textbook. That’s too bad, because the Medicaid issue is at least as vital to the preservation of constitutional government as the individual mandate issue.

In the trial court below, Judge Roger Vinson ruled that the law’s Medicaid provisions are constitutional. The court of appeals affirmed his ruling but totally ignored his provocative reasoning.

The federal government sends huge amounts of money to the states — but imposes strict conditions on that money. This way, the federal government can pressure states into doing things (such as raise their drinking ages to 21) that it could not constitutionally require them to do. In South Dakota v. Dole (1987), the Supreme Court said that the penalty of losing federal funds “might be so coercive as to pass the point at which pressure turns into compulsion,” which is unconstitutional. The Court insisted that compliance with federal conditions must remain “the prerogative of the States not merely in theory but in fact.”

Judge Vinson observed that federal courts routinely pay lip service to Dole’s coercion doctrine but have never in practice found coercion in any case, no matter how onerous the conditions. So he concluded that the plaintiffs’ coercion claim could not succeed “and that the defendants are entitled judgment as a matter of law.”

Now think about that. The 26 states suing to stop Obamacare argued that they simply could not afford the loss of Medicaid funds, so compliance is in no sense voluntary — a violation of Dole. The government countered with evidence that in fact the penalty is less onerous than claimed. And yet, Judge Vinson ruled that there was no issue of material fact, and the government was entitled to judgment as a matter of law. This was a remarkable ruling at the summary judgment stage — before a trial on the facts. Dole plainly requires a factual inquiry into whether federal conditions “pass the point at which pressure turns into compulsion”; compliance must remain a state prerogative “not merely in theory but in fact.” There was at least an issue of material fact as to whether the Medicaid expansion provisions are so onerous that states can’t afford to opt out. The 11th Circuit should at least have reversed that summary judgment and returned the case to Judge Vinson for a trial on the facts.