Virginia, Severability, and the Supreme Court

The Virginia Debacle.

Last week, one of the most important judicial decision of the decade was handed down in Virginia and went virtually un-noticed by the rest of the country.
Virginia is one of the states that is trying the new healthcare law in court. Specifically, they are contesting the thought that the Federal Government has the authority to require a patriot to purchase a product that they don’t want…in this case, health insurance. The fact of the matter is that this will unlikely go to the Supreme Court. The federal court will rule that it IS unconstitutional. The reason is this: the Supreme Court has already argued and ruled this type of requirement ‘unconstitutional’ when a part of the Brady Bill was contested in the late 1980’s. Precedent is already set.
But the fact is, that the states are only sending this through the courts for a single reason: the Healthcare law has no “severability” clause. Most major legislation contains clauses that basically say, ‘if any part of this law is struck down by the courts, the unaffected portions remain law, anyway.’ This was an odd over-sight by the writers of the law. Without severability, if any part of the law is deemed unconstitutional, the entire law could be thrown out. The signers never noticed because, well, they admittedly never read the bill, they just signed it. Since it was passed by reconciliation instead of a vote, it was too late to add it, once it was discovered to be missing.
There are court precedents leaning both ways regarding ‘severability.’ Most often the judgment depends on the effect of the unlawful portion, in regards to the rest of the law. In this case, the portion stating that everyone must purchase insurance seems like a very small part of the law, so it might be overlooked, rather than the cause of declaring the entire law unconstitutional.
I disagree. I believe the requirement to be the hinge upon which the law moves.
By example: let’s say that the court rules that the federal government can’t force its patriots to purchase insurance (as the Supreme Court has already ruled). Once this is applied, we return to the thought of people only having insurance if they want it. The problem is that this undermines many other parts of the law in substantial ways. The biggest and most obvious are the ‘pre-existing condition’ clause and the ‘high risk pools.’ The high risk pools are designed to spread the cost of higher-risk insurees across the lower-risk insurees’ premiums…much the way no-fault insurance works. It doesn’t matter whether you have a good driving record or a bad driving record, everyone pays the same premium. . Couple that with the fact that companies will HAVE to immediately insure people, regardless of pre-existing condition, and here’s what has the potential to happen:
Citizen A chooses not to pay $300/month in premiums for 20 years because he is young and healthy. Rather, he pays out-of-pocket for a routine exam every now and then. One day, he gets sick and goes to his doctor who tells him that he has terminal cancer. Citizen A walks down to his insurance agent and buys insurance. Since there is no waiting period and no pre-existing clause, he is, BY LAW, allowed to do this. The company, BY LAW, has to insure him. He has paid no money into a risk-pool, but BY LAW has the right to take out as much as is deemed necessary for treatment.
Ultimately, this is like being allowed to drive without car insurance, but having a law stating that you can buy insurance after an accident…and they HAVE to cover you.
This will bankrupt every insurance company in a matter of months.
Now my cynical side comes out. Isn’t this what the government really wanted (and proposed) to begin with? To eliminate the insurance companies and force everyone to have government-run insurance? The framers of this law were not stupid…they knew the consequences. That is why, there is a $5 Billion dollar reserve to set up the public insurance option that was reportedly not in the bill. (I know this because, unlike most of congress, I actually READ all 2026 pages of the bill before it was signed into law.)
Every single person in this country, regardless of their stance on healthcare reform, had better understand how this first-level ruling in Virginia will affect them. If this portion of the law is thrown out without the whole law, in a matter of months (of the law taking full effect), Billion-dollar industries will fold, unemploying hundreds of thousands of people, further devastating banks and Wall St.
Someone better get a grip on this law and start directing it before it drags us all into bankruptcy…without any insurance at all.