STATE OF FLORIDA et al v. UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES et al
Filing
132
AMICUS CURIAE BRIEF by Governor Tim Pawlenty re 80 MOTION for Summary Judgment. (BADER, HANS)
IN THE UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF FLORIDA PENSACOLA DIVISION
) ) ) ) Plaintiffs, ) ) v. ) ) ) UNITED STATES DEPARTMENT OF ) HEALTH AND HUMAN SERVICES, e t al., ) ) Defenda nts. ) __________________________________________)
STATE OF FLORIDA, by and through BILL McCOLLUM, ATTORNEY GENERAL OF THE STATE OF FLORIDA, et al.,
Case No.: 3:10-CV-91-RV/EMT
BRIEF OF GOVERNORS TIM PAWLENTY AND DONALD L. CARCIERI AS AMICI CURIAE IN SUPPORT OF PLAINTI FFS' MOTION FOR SUMMARY JUDGMENT
Hans F. Bader (D.C. Bar # 466545) Counsel of Record Sam Kazman Competitive Enterprise Institute 1899 L Street, NW, 12 th Floor Washington, DC 20036 Telephone: (202) 331-2278 Facsimile: (202) 331-0640 Counsel for Amici Curiae Governors Tim Pawlenty and Donald L. Carcieri
TABLE OF CONTENTS
I. INTEREST OF AMICI ...................................................................................1
II. ARGUMENT ....................................................................................................2 The Affordable Care Act is Unconstitutionally Vague and Indefinite ..............2 A. The ACA's Ambiguity Renders It Illegitimate Under Spending-Clause Jurisprudence, Which Requires That Federal Conditions Be Clear and Definite Enough to Be Contractually Valid and Enforceable .......................... 2 B. The ACA's Complexity Accentuates Its Vagueness .......................................... 4 C. The ACA's Vagueness Is Aggravated by the Vast Discretion and Virtual Blank Check It Gives to the Federal Officials Who Implement It ...............6 D. The Law's Expansive Reach Makes Its Nebulousness More Grave ............. 10 E. By Leaving the Federal Government With Unbridled Power to Expand States' Medicaid Obligations, the ACA Violates Principles Forbidding Illusory and Indeterminate Contracts.................................................................. 13
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TABLE OF AUTHORITIES
Cases
Arlington Cent. Sch. Dist. Bd. of Educ. v. Murphy, 548 U.S. 291 (2006) .............................. 3, 4, 6 Association Ben. Services, Inc. v. Caremark RX, Inc., 493 F.3d 841 (7th Cir. 2007) ..................... 3 Barnes v. Gorman, 536 U.S. 181 (2002) .................................................................................. 3, 4 Botts v. State, 604 S.E.2d 512 (Ga. 2004) .................................................................................. 10 Cheek v. U.S., 498 U.S. 192 (1991) ............................................................................................. 6 Livermore v. Heckler, 743 F.2d 1396, 1403 (9th Cir. 1984) .......................................................... 4 Matter of T & B General Contracting, 833 F.2d 1455 (11th Cir. 1987) ........................................ 3 Nebraska v. E.P.A., 331 F.3d 995 (D.C. Cir. 2003) ...................................................................... 4 New York v. United States, 505 U.S. 144 (1992) .......................................................................... 2 Pennhurst State School & Hosp. v. Halderman, 451 U.S. 1 (1981) ........................................ 3, 14 Purgess v. Sharrock, 33 F.3d 134 (2d Cir. 1994) ....................................................................... 13 Reno v. ACLU, 521 U.S. 844 (1997) .......................................................................................... 12 South Dakota v. Dole, 483 U.S. 203 (1987) ......................................................................... 1, 3, 6 Virginia v. Riley, 106 F.3d 559 (4th Cir. 1997) ........................................................................... 12 Young & Vann Supply Co. v. Gulf F. & A. Ry. Co., 5 F.2d 421 (5th Cir.1925)............................ 13
Constitutional Provisions
Minn. Const., Art. IV, § 23.......................................................................................................... 1 Minn. Const., Art. XIII, § 1 ......................................................................................................... 1 Rhode Island Const., Art. IX, § 15............................................................................................... 1 Rhode Island Const., Art. XII ...................................................................................................... 1 Spending Clause................................................................................................................ 1, 3, 15 Tenth Amendment....................................................................................................................... 2
Treatises
Restatement (Second) Contracts ............................................................................................ 3, 14 Williston on Contracts (4th ed. Updated 2010) .......................................................................... 14
Other Authorities
Abelson, Health Rules Are Waived More Often, New York Times, Nov. 10, 2010, at B2 ............. 7 Abelson, Waivers Aim at Talk of Dropping Health Coverage, New York Times, Oct. 7, 2010, at B1 ........................................................................................................................................... 8 Chen, How Obamacare Burdens Already Strained State Budgets, Heritage Foundation, Nov. 10, 2010 (Backgrounder #2489) .................................................................................................. 12 Congressional Research Service, Deadlines for the Secretary of Health and Human Services in the Patient Protection and Affordable Care Act, Oct. 1, 2010, at 1 ........................................... 8 Congressional Research Service, Summary of Potential Employer Penalties Under PPACA (P.L. 111-148), Apr. 5, 2010 .......................................................................................................... 11 ii
Department of Health and Human Services, Approved Applications for Waiver of the Annual Limits Requirements of the PHS Act Section 2711 As of Nov. 1, 2010 ...................................... 7 Freire, Dems Admit CEO's Were Right to Report Losses from Obamacare, Washington Examiner, April 27, 2010 ........................................................................................................ 8 Georgetown Health Policy Institute Center for Children and Families, Medicaid and State Budgets: Looking at the Facts (2008) .................................................................................... 12 Hacker, Health Reform 2.0, American Prospect, Sept. 1, 2010, at A25....................................... 14 Haislmaier & Blase, Obamacare: Impact on States, Heritage Foundation, July 1, 2010 (Backgrounder #2433)..................................................................................................... 10, 11 Joint Economic Committee Republicans, America's New Health Care System Revealed: Updated Chart Shows Obamacare's Bewildering Complexity, Committee News, Aug. 2, 2010 .............. 4 Joint Economic Committee, Republican Staff, Your New Health Care System, ............................ 4 Malkin, Creators Syndicate, Repeal Is the Ultimate Obamacare Waiver, Washington Examiner, Nov. 18, 2010, at 43 ............................................................................................................ 7, 8 Sen. Tom Coburn, HHS Administrative Failure: HHS Failed to Meet a Third of Mandated Deadlines Under New Federal Health Care Law, Oct. 4, 2010 ................................................ 9 Senator Tom Harkin, Health Legislation A Solid Foundation to Build Upon, Wilmington NewsJournal, Dec. 30, 2009 ........................................................................................................... 13 Siegel, Obamacare Will Clog America's Medical System, USA Today, Oct. 19, 2010, at 9A ....... 8 Surber, Obamacare Leads to 47% Premium Hike, Charleston Daily Mail, Oct. 16, 2010 ............. 8
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I. INTEREST OF AMICI As the Governors of Minnesota and Rhode Island, respectively, amici Tim Pawlenty and Donald L. Carcieri have a direct interest in this case. The Patient Protection and Affordable Care Act of 2010 ("ACA") fundamentally transforms Medicaid and will effectively co-opt control over the States' budgetary processes and legislative agendas, crowding out spending on other state priorities, including duties that are mandated by state constitutions. 1 Give n their role in shaping and overseeing state budgets, the Governors have a vital stake in ensuring that basic limits on the federal government's spending power are maintained. 2 One of those limits is that any conditions imposed by federal law must be clear, so that States may exercise their choice to accept or reject federal funds "knowingly, cognizant of the consequences of their participation." 3 On November 12, this Court granted the Governors leave to file their amicus brief (Docket # 108).
See, e.g., Minn. Const., Art. XIII, § 1 ( state has "duty" to "establish a general and uniform system of public schools" that is "thorough and efficient"); Rhode Island Const., Art. XII ( state has "duty" to "promote public schools and public libraries" to foster "diffusion of knowledge," a nd to not "divert" education funds). 2 See, e.g., R hode Island Const., Art. IX, § 15 (Gover nor "shall prepare and present" the state budget "to the general assembly"); Minn. Const., Art. IV, § 23 (line-item veto). 3 South Dakota v. Dole, 483 U.S. 203, 207 (1987).
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II. ARGUMENT The Affordable Care Act is Unconstitutionally Vague and Indefinite A. The ACA's Ambiguity Renders It Illegitimate Under Spending-Clause Jurisprudence, Which Requires That Federal Conditions Be Clear and Definite Enough to Be Contractually Valid and Enforceable As plaintiffs rightly note, the ACA "violates the principle that conditions on federal funds must be unambiguous, so as to `enable the states to exercise their choice knowingly, cognizant of the consequences of their participation.'" 4 This is both because the ACA includes "vast potential liabilities that cannot even be projected as of now," and because "the ACA's sweeping changes could not reasonably have been foreseen by the states when they started their Medicaid programs." 5 As a result, the States could not have voluntarily and knowingly assumed the burdens and liabilities now imposed on them by the ACA. Even looking at the ACA purely from the vantage point of the present, rather than when States began participating in Medicaid, the ACA is so ambiguous and indefinite that it is facially unconstitutional, as we explain below. This vagueness undermines political accountability and thus aggravates the ACA's unduly coercive aspects, in violation of the Tenth Amendment. 6
Memorandum In Support of Plaintiffs' Motion for Summary Judgment at 36. Id.. at 42, 45. 6 See New York v. United States, 505 U.S. 144, 168 (1992) (Spending Clause legislation's legitimacy is rooted in the fact that "where Congress encourages state regulation rather than compelling it, state governments remain responsive to the local electorate's preferences; state officials remain accountable to the people."; " Accou ntability is thus
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The Supreme Court has repeatedly characterized legislation enacted pursuant to the spending power as "much in the nature of a contract: in return for federal funds, the States agree to comply with federally imposed conditions." 7 "The legitimacy of Congress' power to legislate under the spending power thus rests on whether the State voluntarily and knowingly accepts the terms of the contract." Pennhurst State School & Hosp. v. Halderman, 451 U.S. 1, 17 (1981). But even if States could choose to stop participating in the Medicaid program, the ACA is so vague that it does not and cannot allow the States "to exercise their choice knowingly, cognizant of the consequences of their participation." Dole, 483 U.S. at 207 (quoting Pennhurst). The ACA fails to speak "unambiguously," Pennhurst, 451 U.S. at 17, about how a State can opt out of Medicaid's expansion, and what State compliance may mean if it opts in. Because the States are not given a clear and informed choice between participation and non-participation, the Act lacks the hallmarks of contractual enforceability. See, e.g., Matter of T & B General Contracting, 833 F.2d 1455, 1459 (11th Cir. 1987) ("Without a meeting of the minds on all essential terms, no enforceable contract arises."). 8 The Act is indefinite in other key respects as well, so "we cannot fairly say that [a] State could make an informed choice." Pennhurst,
diminished when, due to federal coercion, elected state officials cannot regulate in accordance with the views of the local electorate."). 7 Pennhurst, 451 U.S. 1, 17 (1981); see also Barnes v. Gorman, 536 U.S. 181, 186 (2002); Arlington Cent. Sch. Dist. Bd. of Educ. v. Murphy, 548 U.S. 291, 296 (2006). 8 See also Association Ben. Services, Inc. v. Caremark RX, Inc., 493 F.3d 841, 850 (7th Cir. 2007); Restatement (Second) Contracts, § 33; see Pennhurst, 451 U.S. at 17 (must show states' acceptance of "the terms of the contract'").
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451 U.S. at 25. "There can, of course, be no knowing acceptance if a State is unaware of the conditions or is unable to ascertain what is expected of it." 9 B. The ACA's Complexity Accentuates Its Vagueness The ACA is so mammoth, its provisions are so complex, and its passage was so irregular that the federal attorneys who have spent the past eight months defending it cannot even clearly identify its length. (See Tr. at 8, Docket # 77). Its sheer complexity is aptly, but only partially, captured by the chart provided by minority staff of the Joint Economic Committee, which is found on the next page. 10 (While that "chart displays a bewildering array of new government agencies, regulations and mandates," the reality is even more complicated, since "committee analysts could not fit the entire health care bill on one chart. `This portrays only about one-third of the complexity of the final bill. It's actually worse than this.'" 11
Id. at 17-18; see Arlington Cent. Sch. Dist., 548 U.S. at 296; Barnes, 536 U.S. at 186. See Joint Economic Committee, Republican Staff, Your New Health Care System, available at http://jec.senate.gov/republicans/public/?a=Files.Serve&File_id=5ee16e0f6ee6 -4643-980e-b4 d5f1 d7759a (visited Nov. 18, 2010); Nebraska v. E.P.A., 331 F.3d 995, 998 n.3 (D.C. Cir. 2003) (taking judicial notice of agency materials on web); Air Transport Ass'n v. U.S. Dep't of Transp., 613 F.3d 206, 208 (D.C. Cir. 2010) (citing JEC report); Livermore v. Heckler, 743 F.2d 1396, 1403 (9th Cir. 1984) (repor t by JEC staff). 11 See Joint Economic Committee Republicans, America's New Health Care System Revealed: Updated Chart Shows Obamacare's Bewildering Complexity, Committee News, Aug. 2, 2010 (quoting Rep. Brady), available at http://jec.senate.gov/r epu blicans/pu blic/index.cfm? p=CommitteeN ews&ContentR ecord_i d=bb302d88-3d0 d-4424-8e33-3 c5d2578c2b0 ( visited Nov. 18, 2010).
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