The Supreme Court's landmark decision upholding President Obama's health care law -- while imposing limits on the federal government's ability to withhold Medicaid funding to states – appears likely to drive new litigation challenging environmental programs that similarly withhold money as a sanction for non-compliance, such as EPA-imposed highway funding cuts for states that fail to craft Clean Air Act plans.
But the high court's 5-4 decision in National Federation of Independent Business, et al. v. Department of Health and Human Services, et al., is expected to have less of an impact on environmental statutes grounded in the Constitution's Commerce Clause even though the court found the individual health insurance mandate required by Affordable Care Act (ACA) to be unconstitutional under the clause. The justices upholding the law instead ruled that the ACA mandate is a constitutional tax.
“The Medicaid expansion thus violates the Constitution by threatening states with the loss of their existing Medicaid funding if they declined to comply with the expansion,” the opinion by Chief Justice John Roberts says. “The constitutional violation is fully remedied by precluding the secretary from applying [the section that withdraws] existing Medicaid funds for failure to comply with the requirements set out in the expansion. The other provisions of the Affordable Care Act are not affected.”
Some conservative legal scholars now say the ruling could drive challenges to Clean Air Act provisions that allow EPA to withhold highway money from states and localities that do not develop adequate plants to comply with national ambient air quality limits. EPA rarely if ever actually imposes the sanctions.
“Holding that it would be unconstitutional to terminate existing Medicaid funds to states that refuse to go along with the Medicaid expansion is quite significant, particularly as seven justices joined this result,” Case-Western Reserve University law professor Jonathan Adler says in a June 28 blog on the Volokh Conspiracy. “Going forward, I expect this portion of the opinion to have the greatest practical impact. In fact, I can think of some federal laws, including portions of the Clean Air Act, that are likely to be challenged on these grounds.”
Additionally, Ann Carlson, a law professor of the University of California-Los Angeles (UCLA), writes June 28 on the Legal Planet blog that “the Medicaid portion of the new health care decision could raise some trouble with at least some provisions of federal environmental statutes” such as the Clean Air Act state implementation plan (SIP) requirement.
“States that fail to prepare and implement adequate SIPs, for example, can lose federal highway funds. . . . The threat of losing federal highway funds is a pretty huge one that states simply don't want to face. The question now is whether that condition -- enact a comprehensive and legitimate SIP or lose highway funds -- is constitutional in the wake of the health care law.” She adds that the ruling “could be used by states reluctant to implement fully compliant [SIPs] to play hardball with the EPA in negotiations over whether a SIP is adequate.”
Narrow Commerce Clause Impact
Carlson downplays the ruling's impact on environmental statutes grounded in the Commerce Clause, a concern that was raised after the court heard oral arguments on the health care case in March.
The majority opinion says, “Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority. . . . “Upholding the Affordable Care Act under the Commerce Clause would give Congress the same license to regulate what people do not do.”
Carlson says it is unlikely the holding that the ACA violates the Commerce Clause “will have any real effect on environmental law” because the decision concerns whether Congress can require a person to engage in commerce. “Environmental laws don't force people into commerce; instead they attempt to regulate the negative consequences of commerce.”
However, fellow UCLA law professor Jonathan Zasloff writes in a June 28 post to the same Legal Plant blog, "Environmental lawyers will need to look at this decision very carefully. . . . [I]t appears as if Chief Justice Roberts' opinion has cut back the scope of Commerce Clause authority and under the Necessary and Proper Clause as well as limiting the ability of the federal government to condition federal spending to states' action. All of these provisions very directly concern the scope of environmental statutes. How much the opinion cuts these things back, I don't know.”
The four other justices in the majority -- Ruth Bader Ginsburg, Sonia Sotomayor, Elena Kagan and Stephen Breyer -- would have upheld the ACA on Commerce Clause grounds but had to back off that holding in the opinion to win Roberts' support to uphold the law on other grounds. Justice Anthony Kennedy joined the court's conservative wing -- Justices Antonin Scalia, Clarence Thomas and Samuel Alito -- in dissenting.
Zasloff writes, “Overall: conservatives may have lost the battle here, but General Roberts has laid the groundwork for successful campaigns in the future. Whatever else he is, the Chief Justice is a very smart man.”
Zasloff and others had also warned of Commerce Clause impacts from the ruling on environmental statutes, for example noting that if the high court struck down the mandate, then all bets were off for what it would reject next.