July 2, 2012 18:11 Age: 2 yrs

Affordable Care Act Ruling A Victory for Children

By Barbara Bennett Woodhouse

The Supreme Court’s ruling in the Affordable Care Act (ACA) cases was a victory for children. The United States ranks near the bottom of developed nations in children’s health and ACA aimed to rectify this situation. 

The Emory Child Rights Project filed an amicus brief on behalf of child advocacy organizations, arguing that national regulation was needed to prevent the states from competing to be the cheapest place to do business and the least protective of vulnerable children. If one state passed a robust universal health insurance scheme, businesses would leave for another state that adopted a cheaper approach. 

ACA was needed to ensure that children and youth in every state have access to affordable health care, despite pre-existing conditions and other barriers to care. But this is not the first time Congress has faced challenges to its power to protect children. In its brief, the Emory Child Rights Project urged the Court to remember the child labor cases and avoid repeating the mistakes of an earlier Court that narrowly interpreted both the commerce and tax clauses to strike down laws intended to protect vulnerable children.

In the beginning of the last century, in response to the evil of child labor, Congress passed a law prohibiting employers from hiring children in dangerous jobs.  In 1918, the Court struck it down in the now infamous case of Hammer v. Dagenhart, 247 U.S. 251. Over an eloquent dissent by Justice Oliver Wendell Holmes Jr., the Court held that the law exceeded federal authority under the Commerce Clause since the activity it sought to regulate occurred entirely within state borders.

Undaunted, children’s advocates secured passage of a federal tax on businesses that shipped goods manufactured with child labor. In Bailey v. Drexel Furniture Co., 259 U.S. 20 (1922), the Court declared that Congress had again exceeded its powers. Although called a “tax” on child labor, the Court interpreted the provision as a “penalty” that was beyond the scope of federal taxing powers. It took 23 years before the Court rectified its mistake in United States v. Darby, 312 U.S. 100 (1941), closing a sad chapter in Supreme Court history and children’s rights. 

Faced with a similar problem of national scope involving protection of vulnerable populations from exploitation in the interstate insurance markets, the modern drafters of the Affordable Care Act relied on both the commerce and taxing powers, although they avoided labeling the provision a tax, since “tax” has become a fighting word. In his pivotal opinion, Chief Justice John Roberts cited Drexel Furniture but distinguished the penalty imposed by ACA for failure to comply with its minimum coverage provision.

By interpreting the ACA payment as a tax, Chief Justice Roberts provided a crucial fifth vote, joining with Justices Stephen Breyer, Ruth Ginsburg, Sonia Sotomayor and Elena Kagan in saving the minimum coverage provision.    

The Child Rights Project was happy to see the minimum coverage provision of ACA survive because it is part of a larger scheme assuring universal coverage of children. But it was troubling to encounter Drexel Furniture as a precedent to be respectfully cited and painstakingly distinguished.

It was also troubling that five justices applied a cramped and rigid reading of the Constitution worthy of Hammer v. Dagenhart to hold Congress had exceeded its commerce clause powers. The difference between regulation of action and inaction on which the Court relied rings hollow when applied to children, who can no more choose whether to participate in the insurance market in 2011 than they could choose whether to participate in the labor market in 1911.    

We had hoped for a clear rejection of the discredited child labor cases and their approach to federal authority. Instead, long dead doctrines appear to have been resurrected. It remains to be seen whether the ACA cases signal a sharp turn away from a pragmatic reading of federal powers and back towards an era when an activist Supreme Court routinely struck down progressive legislation aimed at protecting the vulnerable from exploitation. 

Laws that have successfully run the gauntlet of the democratic process, overcoming powerful and well-funded opposing interests deserve great judicial deference. If the Court reverts to a rigid interpretation of federal powers in the realm of social legislation, it is bad news for children. In this modern world, more than ever, issues that affect the welfare of America’s children, such as child abuse, child sexual exploitation, violence in media, streets and schools, food safety, environmental degradation and health care, transcend state borders and demand national solutions.              

Woodhouse is L.Q.C. Lamar Professor of Law and Faculty Advisor for the Barton Child Law and Policy Center.

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