Jonathan Cohn

Oral arguments for the Supreme Court on Monday were supposed to be boring. The subject wasn’t the individual mandate, after all. It was the Anti-Injunction Act, a relatively obscure law that prevents courts from hearing legal challenges to taxes until after somebody has paid them.

But while the session was not always exciting, the justices did drop two hints about their thinking. All the justices seem eager to decide this case, rather than punting on jurisdictional grounds. And even some of the liberals are questioning whether the individual mandate qualifies as a tax, although, as always, it’s hard to know whether their comments today signal how they’d vote in the end.

The tax issue is important because the law’s defenders, including the administration, have cited the federal government’s authority to tax as one justification for the individual mandate. But when Robert Long, the court-appointed attorney, tried to make the argument that the mandate was a tax – at least for the purposes of the anti-Injunction Act – Justice Stephen Breyer pointedly asked about that assertion

Now, here, Congress has nowhere used the word ‘tax.’ What it says is penalty. Moreover, this is not in the Internal Revenue Code ‘but for purposes of collection.’
Moments late, Justice Ruth Bader Ginsburg chimed in with a similar sentiment:

The Tax Injunction Act does not apply to penalties that are designed to induce compliance with the law rather than to raise revenue. And this is not a revenue-raising measure, because, if it’s successful, they won’t — nobody will pay the penalty and there will be no revenue to raise.
The huge, big caveat here is that the Court could decide that the mandate is not a tax, for the purposes of the anti-injunction act, but that it is a tax, for purposes of the mandate’s constitutionality. In fact, that’s what the administration has been arguing.

Neither Breyer nor Ginsburg made clear how they thought about that. But one of their conservative colleagues, Justice Samuel Alito, expressed some skepticism when he put a question directly to Don Verrilli, solicitor general: “Has the Court ever held that something that is a tax for purposes of the taxing power under the Constitution is not a tax under the Anti-Injunction Act?” Verrilli said, no, although he argued that other precedents suggested the government’s reading was correct.

After the hearing, at least one attorney who was present for oral argument agreed that the justices seemed to be telegraphing skepticism of the tax argument. “Several asked questions that made it clear they were going to give the government a workout tomorrow on whether the mandate is a tax,” said Elizabeth Wydra, chief counsel to the Constitutional Accountability Center, who has filed an amicus belief on behalf of state legislators who support the law. But other close observers of the Court, like Lyle Denniston, of SCOTUSblog, seemed less convinced the justices were sending a signal with their comments.

If, indeed, the justices are skeptical of the tax argument, it’s hardly fatal to the government’s case. Although many defenders of the law (including me) have argued the mandate is a tax, the lower courts have generally ruled against that argument – and attorneys close to the case have said, for some time, it is the least likely of the three justifications to pass judicial muster.

The stronger grounds for the mandate, they have been saying, are the government’s power to regulate interstate commerce and to do whatever is “necessary and proper” for carrying out its duties. The justices did not offer any clear hints on how they’re thinking along those lines, although, as George Washington University Professor Orin Kerr noticed, Chief Justice John Roberts did start one intriguing exchange towards the end.

While questioning Gregory Katsas, the lawyer representing the states challenging the mandate, Roberts wondered whether the mandate really qualified as a mandate given the relatively weak penalties. (Remember, the maximum penalty for violating the insurance requirement and failing to pay the fee is a forfeiture of future tax refunds; there is no criminal sanction.) As Kerr notes at the Volokh Conspiracy blog, the whole premise of the lawsuits is that the mandate is a command (in this case, a command to buy insurance). But the Court could rule that the mandate is just a financial incentive for obtaining insurance, presumably rendering it constitutional. 

The justices did offer one other glimpse into their thinking, also during Katsas’ time. And the issue was one that will come up on Wednesday: Whether the Affordable Care Act’s expansion of Medicaid is coercive to the states.

Justice Elana Kagan got Katsas to acknowledge that the states’ worry about the expansion wasn’t simply about adding new people to Medicaid – it was about enrolling people who were already eligible but had not enrolled. These new numbers, he suggested, would deplete state treasuries. Said Kagan:

…that does seem odd, to suggest that the State is being injured because people who could show up tomorrow with or without this law will — will show up in greater numbers. I mean, presumably the State wants to cover people whom it has declared eligible for this benefit.
This is consistent with the argument that the government and its supporters have made all along: That the argument against expanding Medicaid would be an argument against the existing Medicaid program.

Note: I updated this item, to emphasize that the implications of Breyer and Ginsbug’s comments were unclear and cite Orin Kerr’s find at Volokh Conspiracy.