The lawsuit filed by Virginia's Attorney General challenges the authority of Congress acting under the Interstate Commerce clause of the U.S. Constitution to require the purchase of health insurance. The Complaint cites a report by the Congressional Research Service, which analyzes the constitutionality of such a requirement.
What the so-called "Patient Protection and Affordable Healthcare Act" says about the nexus between interstate commerce and the so-called "individual responsibility requirement" is this:
(a) FINDINGS.—Congress makes the following findings:
(1) IN GENERAL.—The individual responsibility requirement
provided for in this section (in this subsection referred to as
the ‘‘requirement’’) is commercial and economic in nature, and
substantially affects interstate commerce, as a result of the
effects described in paragraph (2).
(2) EFFECTS ON THE NATIONAL ECONOMY AND INTERSTATE
COMMERCE.—The effects described in this paragraph are the
(A) The requirement regulates activity that is commercial
and economic in nature: economic and financial
decisions about how and when health care is paid for,
and when health insurance is purchased.
(B) Health insurance and health care services are a
significant part of the national economy. National health
spending is projected to increase from $2,500,000,000,000,
or 17.6 percent of the economy, in 2009 to
$4,700,000,000,000 in 2019. Private health insurance
spending is projected to be $854,000,000,000 in 2009, and
pays for medical supplies, drugs, and equipment that are
shipped in interstate commerce. Since most health insurance
is sold by national or regional health insurance companies,
health insurance is sold in interstate commerce and
claims payments flow through interstate commerce.
(C) The requirement, together with the other provisions
of this Act, will add millions of new consumers to the
health insurance market, increasing the supply of, and
demand for, health care services. According to the Congressional
Budget Office, the requirement will increase the
number and share of Americans who are insured.
(D) The requirement achieves near-universal coverage
by building upon and strengthening the private employerbased
health insurance system, which covers 176,000,000
Americans nationwide. In Massachusetts, a similar requirement
has strengthened private employer-based coverage:
despite the economic downturn, the number of workers
offered employer-based coverage has actually increased.
(E) Half of all personal bankruptcies are caused in
part by medical expenses. By significantly increasing health
insurance coverage, the requirement, together with the
other provisions of this Act, will improve financial security
(F) Under the Employee Retirement Income Security
Act of 1974 (29 U.S.C. 1001 et seq.), the Public Health
Service Act (42 U.S.C. 201 et seq.), and this Act, the Federal
Government has a significant role in regulating health
insurance which is in interstate commerce.
(G) Under sections 2704 and 2705 of the Public Health
Service Act (as added by section 1201 of this Act), if there
were no requirement, many individuals would wait to purchase
health insurance until they needed care. By significantly
increasing health insurance coverage, the requirement,
together with the other provisions of this Act, will
minimize this adverse selection and broaden the health
insurance risk pool to include healthy individuals, which
will lower health insurance premiums. The requirement
is essential to creating effective health insurance markets
in which improved health insurance products that are
guaranteed issue and do not exclude coverage of preexisting
conditions can be sold.
(H) Administrative costs for private health insurance,
which were $90,000,000,000 in 2006, are 26 to 30 percent
of premiums in the current individual and small group
markets. By significantly increasing health insurance coverage
and the size of purchasing pools, which will increase
economies of scale, the requirement, together with the other
provisions of this Act, will significantly reduce administrative
costs and lower health insurance premiums. The
requirement is essential to creating effective health insurance
markets that do not require underwriting and eliminate
its associated administrative costs.
(3) SUPREME COURT RULING.—In United States v. South-
Eastern Underwriters Association (322 U.S. 533 (1944)), the
Supreme Court of the United States ruled that insurance is
interstate commerce subject to Federal regulation.
H.R. 3590, section 1501(a)(1)-(a)(3).