Supreme Court Health Reform Law: Obama Administration Finds Optimism

WASHINGTON -- It was not the best or easiest of days for Donald Verrilli.

The U.S. solicitor general, arguing the highest profile case to reach the Supreme Court since Bush v. Gore and, before that, the Civil Rights era, stumbled immediately out of the gate. His presentation of the individual mandate's constitutionality was challenged both by the conservative-leaning justices as well as the swing votes on the bench. Even before the adversarial questioning, Verrilli seemed to have difficulty articulating why compelling people to buy health insurance didn't constitute a new and unlimited interpretation of the Constitution's commerce clause.

By the end, a sense of alarm had engulfed Democrats and even seasoned Supreme Court observers. The conventional legal wisdom that this court would easily validate the constitutionality of the mandate was replaced by the realization that the case will most likely be decided on a 5-to-4 vote and likely against the president.

Administration officials were caught off guard as reporter after reporter rushed to the cameras below the Supreme Court steps to announce that the mandate -- and, in turn, the Affordable Care Act -- was on life support. And within minutes President Barack Obama's team began pushing back against the impression that a year-and-a-half of legislative work was about to be upended.

When the dust settled, defenders of the law still maintained some (albeit limited) reason for optimism.

As noted by several administration officials, similarly adversarial questions had been offered by lower court judges, who went on to rule that the mandate should be upheld. That was the case when Judge Laurence Silberman, a leading conservative on the U.S. Circuit Court of Appeals for the District of Columbia, pressed the president's lawyers for 10 minutes to name a single example of how the individual mandate, when applied to another economic activity, would prove unconstitutional. He ended up issuing a critical ruling in favor of the mandate's legality.

The same dynamic took place when Judge Jeffrey Sutton, a George W. Bush appointee to the 6th Circuit Court of Appeals, used portions of the oral argument to question whether customers would be forced to buy something they neither wanted nor needed. Sutton ultimately ruled that the mandate was constitutional, noting that health care was different from other forms of commerce.

Whether surprise rulings along these lines will come from the Supreme Court when it issues its ruling in June is now a matter of intense speculation and word-parsing. A sober reading of the transcript from Tuesday's oral arguments suggest that Verrilli did the administration few favors. At various points, the more liberal members of the court actually interrupted to outline his arguments for him. But he was dealt, far and away, the tougher hand.

"The chief justice’s questions -– for whatever weight one gives to questions -– are systematically favorable to the government’s position, stating it clearly and forcefully, and asking what’s wrong with that argument," wrote Mark Tushnet at Balkanization, a prominent law and policy blog.

In addition, as a top administration official noted to The Huffington Post, by the end of the three-hour affair, Verrilli actually had produced some breakthroughs.

Chief Justice John Roberts was more circumspect with his consideration of the issue than his conservative colleagues on the bench -- though few administration officials felt confident that he would cast a favorable vote. The more telling moment came when Justice Anthony Kennedy seemed to reach a conclusion similar to Judge Sutton's by the end of the hearing.

And the government tells us that's because the insurance market is unique. And in the next case, it'll say the next market is unique. But I think it is true that if most questions in life are matters of degree, in the insurance and health care world, both markets -- stipulate two markets -- the young person who is uninsured is uniquely proximately very close to affecting the rates of insurance and the costs of providing medical care in a way that is not true in other industries. That's my concern in this case.

By homing in on that Kennedy statement, administration officials were, of course, engaging in precisely the same type of word-parsing they had criticized when used by those who rushed to announce the individual mandate's doom. But that doesn't mean the point is invalid. Tom Goldstein, who publishes the influential SCOTUSBlog and has argued for the mandate's constitutionality, noted it too. As did the ACA [Affordable Care Act] litigation blog, which concluded that Kennedy was leaning against upholding the law, but "seemed at least a little torn."

"Everyone running out from the court saying, 'Oh my gosh, it's over,'" one top administration official told The Huffington Post. "I think people stepped back and read the transcript and realized there was a limiting principle [of the mandate] articulated and that Kennedy did end up, by the end, talking about the unique aspects of the market."