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IN THE SUPREME COURT OF THE UNITED STATES

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- - - - - - - - - - - - - - - - - x

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DEPARTMENT OF HEALTH AND

:

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HUMAN SERVICES, ET AL.,

:

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Petitioners

: No. 11-398

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v.

:

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FLORIDA, ET AL.

:

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- - - - - - - - - - - - - - - - - x

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Washington, D.C.

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Tuesday, March 27, 2012

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The above-entitled matter came on for oral

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argument before the Supreme Court of the United States

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at 10:00 a.m.

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APPEARANCES:

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DONALD B. VERRILLI, JR., ESQ., Solicitor General,

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Department of Justice, Washington, D.C.; on behalf of

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Petitioners.

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PAUL D. CLEMENT, ESQ., Washington, D.C.; on behalf of

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Respondents Florida, et al.

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MICHAEL A. CARVIN, ESQ., Washington, D.C.; on behalf of

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Respondents NFIB, et al.

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C O N T E N T S

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ORAL ARGUMENT OF

PAGE

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DONALD B. VERRILLI, JR., ESQ.

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On behalf of the Petitioners

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ORAL ARGUMENT OF

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PAUL D. CLEMENT, ESQ.

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On behalf of the Respondents Florida, et al.

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ORAL ARGUMENT OF

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MICHAEL A. CARVIN, ESQ.

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On behalf of the Respondents NFIB, et al.

81

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REBUTTAL ARGUMENT OF

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DONALD B. VERRILLI, JR., ESQ.

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On behalf of the Petitioners

108

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P R O C E E D I N G S

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(10:00 a.m.)

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CHIEF JUSTICE ROBERTS: We will continue

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argument this morning in Case 11-398, the Department of

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Health and Human Services v. Florida.

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General Verrilli.

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ORAL ARGUMENT OF DONALD B. VERRILLI, JR.,

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ON BEHALF OF THE PETITIONERS

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GENERAL VERRILLI: Mr. Chief Justice, and

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may it please the Court:

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The Affordable Care Act addresses a

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fundamental and enduring problem in our health care

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system and our economy. Insurance has become the

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predominant means of paying for health care in this

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country. Insurance has become the predominant means of

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paying for health care in this country. For most

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Americans, for more than 80 percent of Americans, the

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insurance system does provide effective access. Excuse

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me.

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But for more than 40 million Americans who

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do not have access to health insurance either through

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their employer or through government programs such as

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Medicare or Medicaid, the system does not work. Those

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individuals must resort to the individual market, and

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that market does not provide affordable health

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insurance. It does not do so because it -- because the

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multibillion dollar subsidies that are available for

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the -- the employer market are not available in the

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individual market. It does not do so because ERISA and

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HIPAA regulations that preclude -- that preclude

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discrimination against people based on their medical

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history do not apply in the individual market. That is

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an economic problem. And it begets another economic

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problem.

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JUSTICE SCALIA: Why aren't those problems

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that the Federal Government can address directly?

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GENERAL VERRILLI: They can address it

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directly, Justice Scalia, and they are addressing it

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directly through this -- through this Act by regulating

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the means by which health care -- by which health care

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is purchased. That is the way this Act works.

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Under the Commerce Clause, what Congress has

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done is to enact reforms of the insurance market,

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directed at the individual insurance market, that

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preclude -- that preclude discrimination based on

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pre-existing conditions, that require guaranteed issue

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and community rating. And it uses -- and the minimum

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coverage provision is necessary to carry into execution

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those insurance reforms -25

JUSTICE KENNEDY: Can you create commerce in

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order to regulate it?

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GENERAL VERRILLI: That's not what's going

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on here, Justice Kennedy, and we're not seeking to

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defend the law on that basis.

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In this case, the -- what is being regulated

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is the method of financing health -- the purchase of

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health care. That itself is economic activity with

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substantial effects on interstate commerce. And -9

JUSTICE SCALIA: So, any self-purchasing?

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Anything I -- you know, if I'm in any market at all, my

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failure to purchase something in that market subjects me

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to regulation.

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GENERAL VERRILLI: No. That's not our

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position at all, Justice Scalia. In the health care

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market -- the health care market is characterized by the

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fact that aside from the few groups that Congress chose

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to exempt from the minimum coverage requirement -- those

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who for religious reasons don't participate, those who

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are incarcerated, Indian tribes -- virtually everybody

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else is either in that market or will be in that market,

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and the distinguishing feature of that is that they

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cannot -- people cannot generally control when they

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enter that market or what they need when they enter that

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market.

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CHIEF JUSTICE ROBERTS: Well, the same, it

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seems to me, would be true, say, for the market in

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emergency services: police, fire, ambulance, roadside

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assistance, whatever.

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You don't know when you're going to need it;

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you're not sure that you will. But the same is true for

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health care. You don't know if you're going to need a

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heart transplant or if you ever will. So, there's a

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market there. In some extent, we all participate in it.

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So, can the government require you to buy a

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cell phone because that would facilitate responding when

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you need emergency services? You can just dial 911 no

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matter where you are?

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GENERAL VERRILLI: No, Mr. Chief Justice. I

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think that's different. It's -- we -- I don't think we

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think of that as a market. This is a market. This is

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market regulation. And, in addition, you have a

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situation in this market not only where people enter

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involuntarily as to when they enter and won't be able to

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control what they need when they enter, but when they -20

CHIEF JUSTICE ROBERTS: It seems to me

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that's the same as in my hypothetical. You don't know

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when you're going to need police assistance. You can't

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predict the extent to emergency response that you'll

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need, but when you do -- and the government provides it.

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I thought that was an important part of your argument,

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that when you need health care, the government will make

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sure you get it.

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Well, when you need police assistance or

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fire assistance or ambulance assistance, the government

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is going to make sure to the best extent it can that you

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get it.

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GENERAL VERRILLI: I think the fundamental

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difference, Mr. Chief Justice, is that that's not an

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issue of market regulation. This is an issue of market

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regulation, and that's how Congress -- that's how

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Congress looked at this problem. There is a market.

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Insurance is provided through a market system -13

JUSTICE ALITO: Do you think there is a

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market for burial services?

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GENERAL VERRILLI: For burial services?

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JUSTICE ALITO: Yes.

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GENERAL VERRILLI: Yes, Justice Alito, I

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think there is.

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JUSTICE ALITO: All right. Suppose that you

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and I walked around downtown Washington at lunch hour

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and we found a couple of healthy young people and we

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stopped them and we said: You know what you're doing?

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You are financing your burial services right now because

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eventually you're going to die, and somebody is going to

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have to pay for it, and if you don't have burial

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insurance and you haven't saved money for it, you're

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going to shift the cost to somebody else.

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Isn't that a very artificial way of talking

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about what somebody is doing?

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GENERAL VERRILLI: No -6

JUSTICE ALITO: And if that's true, why

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isn't it equally artificial to say that somebody who is

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doing absolutely nothing about health care is financing

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health care services.

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GENERAL VERRILLI: It's -- I think it's

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completely different. The -- and the reason is that the

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burial example is not -- the difference is here you are

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regulating the method by which you are paying for

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something else -- health care -- and the insurance

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requirement I think -- I mean, the key thing here is my

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friends on the other side acknowledge that it is within

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the authority of Congress under Article I under the

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commerce power to impose guaranteed-issue and

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community-rating reforms, to end -- to impose a minimum

20

coverage provision. Their argument is just that it has

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to occur at the point of sale, and -22

JUSTICE ALITO: I don't see the difference.

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You can get burial insurance. You can get health

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insurance. Most people are going to need health care,

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almost everybody. Everybody is going to be buried or

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cremated at some point.

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GENERAL VERRILLI: Well, one big

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difference -4

JUSTICE ALITO: What's the difference?

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GENERAL VERRILLI: One big difference,

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Justice Alito, is the -- you don't have the cost

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shifting to other market participants. Here -8

JUSTICE ALITO: Sure you do, because if you

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don't have money, then the State is going to pay for it

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or some -11

GENERAL VERRILLI: But that's different.

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JUSTICE ALITO: A family member is going to

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pay for it.

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GENERAL VERRILLI: That's a difference, and

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it's a significant difference. That in this situation,

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one of the economic effects Congress is addressing is

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that the -- there -- the many billions of dollars of

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uncompensated costs are transferred directly to other

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market participants. It's transferred directly to other

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market participants because health care providers charge

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higher rates in order to cover the cost of uncompensated

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care, and insurance companies reflect those higher rates

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in higher premiums, which Congress found translates to a

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thousand dollars per family in additional health

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insurance costs.

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JUSTICE ALITO: But isn't that really a

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small part of what the mandate is doing? You can

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correct me if these figures are wrong, but it appears to

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me that the CBO has estimated that the average premium

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for a single insurance policy in the non-group market

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would be roughly $5,800 in -- in 2016.

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Respondents -- the economists who have

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supported the Respondents estimate that a young, healthy

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individual targeted by the mandate on average consumes

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about $854 in health services each year. So the mandate

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is forcing these people to provide a huge subsidy to the

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insurance companies for other purposes that the Act

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wishes to serve, but isn't -- if those figures are

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right, isn't it the case that what this mandate is

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really doing is not requiring the people who are subject

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to it to pay for the services that they are going to

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consume? It is requiring them to subsidize services

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that will be received by somebody else.

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GENERAL VERRILLI: No, I think that -- I do

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think that's what the Respondents argue. It's just not

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right. I think it -- it really gets to a fundamental

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problem with their argument.

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JUSTICE GINSBURG: If you're going to have

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insurance, that's how insurance works.

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GENERAL VERRILLI: A, it is how insurance

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works, but, B, the problem that they -- that they are

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identifying is not that problem. The guaranteed issue

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and community rating reforms do not have the effect of

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forcing insurance companies to take on lots of

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additional people who they then can't afford to cover

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because they're -- they tend to be the sick, and that

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is -- in fact, the exact opposite is what happens here.

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The -- when you enact guaranteed issue and

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community rating reforms, and you do so in the absence

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of a minimum coverage provision, it's not that insurance

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companies take on more and more people and then need a

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subsidy to cover it, it's that fewer and fewer people

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end up with insurance because their rates are not

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regulated. Insurance companies, when -- when they have

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to offer guaranteed issue and community rating, they are

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entitled to make a profit. They charge rates sufficient

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to cover only the sick population because health -18

JUSTICE KENNEDY: Could you help -- help me

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with this. Assume for the moment -- you may disagree.

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Assume for the moment that this is unprecedented, this

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is a step beyond what our cases have allowed, the

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affirmative duty to act to go into commerce. If that is

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so, do you not have a heavy burden of justification?

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I understand that we must presume laws are

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constitutional, but, even so, when you are changing the

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relation of the individual to the government in this,

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what we can stipulate is, I think, a unique way, do you

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not have a heavy burden of justification to show

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authorization under the Constitution?

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GENERAL VERRILLI: So two things about that,

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Justice Kennedy. First, we think this is regulation of

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people's participation in the health care market, and

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all -- all this minimum coverage provision does is say

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that, instead of requiring insurance at the point of

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sale, that Congress has the authority under the commerce

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power and the necessary and proper power to ensure that

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people have insurance in advance of the point of sale

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because of the unique nature of this market, because

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this is a market in which -- in which you -- although

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most of the population is in the market most of the

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time -- 83 percent visit a physician every year; 96

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percent over a five-year period -- so virtually

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everybody in society is in this market.

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And you've got to pay for the health care

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you get, the predominant way in which it's -- in which

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it's paid for is insurance, and -- and the Respondents

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agree that Congress could require that you have

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insurance in order to get health care or forbid health

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care from being provided -25

JUSTICE SCALIA: Why do you -- why do you

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define the market that broadly? Health care. It may

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well be that everybody needs health care sooner or

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later, but not everybody needs a heart transplant, not

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everybody needs a liver transplant. Why -5

GENERAL VERRILLI: That's correct, Justice

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Scalia, but you never know whether you're going to be

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that person.

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JUSTICE SCALIA: Could you define the

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market -- everybody has to buy food sooner or later, so

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you define the market as food, therefore, everybody is

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in the market; therefore, you can make people buy

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broccoli.

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GENERAL VERRILLI: No, that's quite

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different. That's quite different. The food market,

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while it shares that trait that everybody's in it, it is

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not a market in which your participation is often

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unpredictable and often involuntary. It is not a market

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in which you often don't know before you go in what you

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need, and it is not a market in which, if you go in

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and -- and seek to obtain a product or service, you will

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get it even if you can't pay for it. It doesn't have -22

JUSTICE SCALIA: Is that a principled basis

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for distinguishing this from other situations? I mean,

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you know, you can also say, well, the person subject to

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this has blue eyes. That would indeed distinguish it

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from other situations. Is it a principled basis? I

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mean, it's -- it's a basis that explains why the

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government is doing this, but is it -- is it a basis

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which shows that this is not going beyond what -- what

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the -- the system of enumerated powers allows the

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government to do.

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GENERAL VERRILLI: Yes, for two reasons.

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First, this -- the test, as this Court has articulated

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it, is: Is Congress regulating economic activity with a

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substantial effect on interstate commerce?

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The way in which this statute satisfies the

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test is on the basis of the factors that I have

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identified. If -14

JUSTICE GINSBURG: Mr. Verrilli, I thought

15

that your main point is that, unlike food or any other

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market, when you made the choice not to buy insurance,

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even though you have every intent in the world to

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self-insure, to save for it, when disaster strikes, you

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may not have the money. And the tangible result of it

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is -- we were told there was one brief that Maryland

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Hospital Care bills 7 percent more because of these

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uncompensated costs, that families pay a thousand

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dollars more than they would if there were no

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uncompensated costs.

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I thought what was unique about this is it's

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not my choice whether I want to buy a product to keep me

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healthy, but the cost that I am forcing on other people

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if I don't buy the product sooner rather than later.

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GENERAL VERRILLI: That is -- and that is

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definitely a difference that distinguishes this market

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and justifies this as a regulation.

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JUSTICE BREYER: All right. So if that is

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your difference -- if that is your difference, I'm

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somewhat uncertain about your answers to -- for example,

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Justice Kennedy asked, can you, under the Commerce

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Clause, Congress create commerce where previously none

12

existed.

13

Well, yes, I thought the answer to that was,

14

since McCulloch versus Maryland, when the Court said

15

Congress could create the Bank of the United States

16

which did not previously exist, which job was to create

17

commerce that did not previously exist, since that time

18

the answer has been, yes. I would have thought that

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your answer -- can the government, in fact, require you

20

to buy cell phones or buy burials that, if we propose

21

comparable situations, if we have, for example, a

22

uniform United States system of paying for every burial

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such as Medicare Burial, Medicaid Burial, Ship Burial,

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ERISA Burial and Emergency Burial beside the side of the

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road, and Congress wanted to rationalize that system,

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wouldn't the answer be, yes, of course, they could.

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GENERAL VERRILLI: So -3

JUSTICE BREYER: And the same with the

4

computers, or the same with the -- the cell phones, if

5

you're driving by the side of the highway and there is a

6

federal emergency service just as you say you have to

7

buy certain mufflers for your car that don't hurt the

8

environment, you could -- I mean, see, doesn't it depend

9

on the situation?

10

GENERAL VERRILLI: It does, Justice Breyer,

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and if Congress were to enact laws like that, we -12

JUSTICE BREYER: Would be up here defending

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it -14

GENERAL VERRILLI: It would be my

15

responsibility to then defend them, and I would defend

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them on a rationale like that, but I do think that we

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are advancing a narrower rationale.

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JUSTICE KENNEDY: Well, then your question

19

is whether or not there are any limits on the Commerce

20

Clause. Can you identify for us some limits on the

21

Commerce Clause?

22

GENERAL VERRILLI: Yes. The -- the

23

rationale purely under the Commerce Clause that we're

24

advocating here would not justify forced purchases of

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commodities for the purpose of stimulating demand.

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We -- the -- it would not justify purchases of insurance

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for the purposes -- in situations in which insurance

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doesn't serve as the method of payment for service -4

JUSTICE KENNEDY: But why not? If

5

Congress -- if Congress says that the interstate

6

commerce is affected, isn't, according to your view,

7

that the end of the analysis.

8

GENERAL VERRILLI: No. The -- we think that

9

in a -- when -- the difference between those situations

10

and this situation is that in those situations, Your

11

Honor, Congress would be moving to create commerce.

12

Here Congress is regulating existing commerce, economic

13

activity that is already going on, people's

14

participation in the health care market, and is

15

regulating to deal with existing effects of existing

16

commerce.

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CHIEF JUSTICE ROBERTS: That, it seems to

18

me, is -- and it's a passage in your reply brief that I

19

didn't quite grasp. It's the same point. You say

20

health insurance is not purchased for its own sake, like

21

a car or broccoli; it is a means of financing health

22

care consumption and covering universal risks. Well, a

23

car or broccoli aren't purchased for their own sake,

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either.

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They're purchased for the sake of

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transportation or, in broccoli, covering the need for

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food.

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GENERAL VERRILLI: No -4

CHIEF JUSTICE ROBERTS: I don't understand

5

that distinction.

6

GENERAL VERRILLI: The difference, Mr. Chief

7

Justice, is that health insurance is the means of

8

payment for health care, and broccoli is -9

CHIEF JUSTICE ROBERTS: Well, now that's a

10

significant -- I'm sorry.

11

GENERAL VERRILLI: And broccoli is not the

12

means of payment for anything else. And an automobile

13

is not -14

CHIEF JUSTICE ROBERTS: It's the means of

15

satisfying a basic human need -16

GENERAL VERRILLI: But -17

CHIEF JUSTICE ROBERTS: -- just as insurance

18

is the means of satisfying -19

GENERAL VERRILLI: But I do think that's the

20

difference between existing commerce, activity in the

21

market already occurring -- the people in the health

22

care market purchasing, obtaining health care

23

services -- and the creation of commerce. And the

24

principle that we're advocating here under the Commerce

25

Clause does not take the step of justifying the creation

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of commerce.

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JUSTICE GINSBURG: General Verrilli, can

3

we -4

GENERAL VERRILLI: This is a regulation of

5

existing commerce.

6

JUSTICE GINSBURG: Can we go back to --

7

Justice Breyer asked a question, and it kind of

8

interrupted your answer to my question. And tell me if

9

I'm wrong about this, but I thought a major, major point

10

of your argument was that the people who don't

11

participate in this market are making it much more

12

expensive for the people who do; that is, they will

13

get -- a goodly number of them will get services that

14

they can't afford at the point when they need them, and

15

the result is that everybody else's premiums get raised.

16

So, you're not -- it's not your free choice

17

just to do something for yourself. What you do is going

18

to affect others, affect them in a major way.

19

GENERAL VERRILLI: That -- that absolutely

20

is a justification for Congress's action here. That is

21

existing economic activity that Congress is regulating

22

by means of this rule.

23

JUSTICE SCALIA: Mr. Verrilli, you could say

24

that about buying a car. If people don't buy cars, the

25

price that those who do buy cars pay will have to be

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higher. So, you could say in order to bring the price

2

down, you're hurting these other people by not buying a

3

car.

4

GENERAL VERRILLI: That is not what we're

5

saying, Justice Scalia.

6

JUSTICE SCALIA: That's not -- that's not

7

what you're saying.

8

GENERAL VERRILLI: That's not -- not -9

JUSTICE SCALIA: I thought it was. I

10

thought you're saying other people are going to have to

11

pay more for insurance because you're not buying it.

12

GENERAL VERRILLI: No. It's because you're

13

going -- in the health care market, you're going into

14

the market without the ability to pay for what you get,

15

getting the health care service anyway as a result of

16

the social norms that allow -- that -- to which we've

17

obligated ourselves so that people get health care.

18

JUSTICE SCALIA: Well, don't obligate

19

yourself to that. Why -- you know?

20

GENERAL VERRILLI: Well, I can't imagine

21

that that -- that the Commerce Clause would -- would

22

forbid Congress from taking into account this deeply

23

embedded social norm.

24

JUSTICE SCALIA: You could do it. But does

25

that expand your ability to issue mandates to -- to the

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people?

2

GENERAL VERRILLI: I -- this is not a

3

purchase mandate. This is a -- this is a law that

4

regulates the method of paying for a service that the

5

class of people to whom it applies are either

6

consuming -7

JUSTICE SOTOMAYOR: General -8

GENERAL VERRILLI: -- or inevitably will

9

consume.

10

JUSTICE SOTOMAYOR: General, I see or have

11

seen three strands of arguments in your briefs, and one

12

of them is echoed today. The first strand that I've

13

seen is that Congress can pass any necessary laws to

14

effect those powers within its rights, i.e., because it

15

made a decision that to effect -- to effect mandatory

16

issuance of insurance, that it could also obligate the

17

mandatory purchase of it.

18

The second strand I see is self-insurance

19

affects the market; and so, the government can regulate

20

those who self-insure.

21

And the third argument -- and I see all of

22

them as different -- is that what the government is

23

doing -- and I think it's the argument you're making

24

today -- that what the -- what the government is saying

25

is if you pay for -- if you use health services, you

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have to pay with insurance, because only insurance will

2

guarantee that whatever need for health care that you

3

have will be covered, because virtually no one, perhaps

4

with the exception of 1 percent of the population, can

5

afford the massive cost if the unexpected happens.

6

This third argument seems to be saying what

7

we're regulating is health care, and when you go for

8

health services, you have to pay for insurance, and

9

since insurance won't issue at the moment that you

10

consume the product, we can reasonably, necessarily tell

11

you to buy it ahead of time, because you can't buy it at

12

the moment that you need it.

13

Is that -- which of these three is your

14

argument? Are all of them your argument? I'm just not

15

sure what the -16

GENERAL VERRILLI: So, let me try to state

17

it this way: The Congress enacted reforms of the

18

insurance market, the guaranteed-issue and

19

community-rating reforms. It did so to deal with a very

20

serious problem that results in 40 million people not

21

being able to get insurance and therefore not access to

22

the health care environment. Everybody agrees in this

23

case that those are within Congress's Article I powers.

24

The minimum coverage provision is necessary

25

to carry those provisions into execution, because

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without them, without those provisions, without minimum

2

coverage, guaranteed issue and community rating will, as

3

the experience in the States showed, make matters worse,

4

not better. There will be fewer people covered; it will

5

cost more. Now, the -6

JUSTICE SOTOMAYOR: So, on that ground -7

GENERAL VERRILLI: So -8

JUSTICE SOTOMAYOR: -- you're answering

9

affirmatively to my colleagues that have asked you the

10

question, can the government force you into commerce?

11

GENERAL VERRILLI: So -- no. No.

12

JUSTICE SOTOMAYOR: And there's no limit to

13

that power.

14

GENERAL VERRILLI: No, because that's -15

that's the first part of our argument.

16

The second part of our argument is that the

17

means here that Congress has chosen, the minimum

18

coverage provision, is a means that regulates the -19

that regulates economic activity, namely your

20

transaction in the health care market, with substantial

21

effects on interstate commerce; and it is the

22

conjunction of those two that we think provides the

23

particularly secure foundation for this statute under

24

the commerce power.

25

JUSTICE KAGAN: General, you've talked on -23

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a couple of times about other alternatives that Congress

2

might have had, other alternatives that the Respondents

3

suggest to deal with this problem, in particular, the

4

alternative of mandating insurance at the point at which

5

somebody goes to a hospital or an emergency room and

6

asks for care.

7

Did Congress consider those alternatives?

8

Why did it reject them? How should we think about the

9

question of alternative ways of dealing with these

10

problems?

11

GENERAL VERRILLI: I do think, Justice

12

Kagan, that the point of difference between my friends

13

on the other side and the United States is about one of

14

timing. They've agreed that Congress has Article I

15

authority to impose an insurance requirement or other -16

or other penalty at the point of sale, and they have

17

agreed that Congress has the authority to do that to

18

achieve the same objectives that the minimum coverage

19

provision in the Affordable Care Act is designed to

20

achieve.

21

This is a situation in which we are talking

22

about means. Congress gets a substantial deference in

23

the choice of means, and if one thinks about the

24

difference between the means they say Congress should

25

have chosen and the means Congress did choose, I think

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you can see why it was eminently more sensible for

2

Congress to choose the means that it chose.

3

JUSTICE KENNEDY: I'm not sure which way it

4

cuts, if the Congress has alternate means. Let's assume

5

that it could use the tax power to raise revenue and to

6

just have a national health service, single payer. How

7

does that factor into our analysis? In one sense, it

8

can be argued that this is what the government is doing;

9

it ought to be honest about the power that it's using

10

and use the correct power.

11

On the other hand, it means that since the

12

Court can do it anyway -- Congress can do it anyway, we

13

give a certain amount of latitude. I'm not sure which

14

the way the argument goes.

15

GENERAL VERRILLI: Let me try to answer that

16

question, Justice Kennedy, and get back to the question

17

you asked me earlier. The -- the -- I do think one

18

striking feature of the argument here that this is a

19

novel exercise of power is that what Congress chose to

20

do was to rely on market mechanisms and efficiency and a

21

method that has more choice than would the traditional

22

Medicare/Medicaid type model. And so, it seems a little

23

ironic to suggest that that counts against it.

24

But beyond that, in the sense that it's

25

novel, this provision is novel in the same way, or

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unprecedented in the same way, that the Sherman Act was

2

unprecedented when the Court upheld it in the Northern

3

Securities case; or the Packers and Stockyards Act was

4

unprecedented when the Court upheld it, or the National

5

Labor Relations Act was unprecedented when the Court

6

upheld it in Jones & Laughlin; or the dairy price

7

supports in Wrightwood Dairy and Rock Royal. And -8

JUSTICE SCALIA: Oh, no, it's not. They all

9

involved commerce. There was no doubt that what was

10

being regulated was commerce. And here you're

11

regulating somebody who isn't covered.

12

By the way, I don't agree with you that the

13

relevant market here is health care. You're not

14

regulating health care. You're regulating insurance.

15

It's the insurance market that you're addressing and

16

you're saying that some people who are not in it must be

17

in it, and that's -- that's different from regulating in

18

any manner commerce that already exists out there.

19

GENERAL VERRILLI: Well, to the extent that

20

we are looking at the comprehensive scheme, Justice

21

Scalia, it is regulating commerce that already exists

22

out there. And the means in which that regulation is

23

made effective here, the minimum coverage provision, is

24

a regulation of the way in which people participate, the

25

method of their payment in the health care market. That

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is what it is.

2

And I do think, Justice Kennedy, getting

3

back to the question you asked before, what -- what

4

matters here is whether Congress is choosing a tool

5

that's reasonably adapted to the problem that Congress

6

is confronting. And that may mean that the tool is

7

different from a tool that Congress has chosen to use in

8

the past. That's not something that counts against the

9

provision in a Commerce Clause analysis.

10

JUSTICE SCALIA: Wait. That's -- it's both

11

"Necessary and Proper." What you just said addresses

12

what's necessary. Yes, has to be reasonably adapted.

13

Necessary does not mean essential, just reasonably

14

adapted. But in addition to being necessary, it has to

15

be proper. And we've held in two cases that something

16

that was reasonably adapted was not proper, because it

17

violated the sovereignty of the States, which was

18

implicit in the constitutional structure.

19

The argument here is that this also is -- may be

20

necessary, but it's not proper, because it violates an

21

equally evident principle in the Constitution, which is

22

that the Federal Government is not supposed to be a

23

government that has all powers; that it's supposed to be

24

a government of limited powers. And that's what all

25

this questioning has been about. What -- what is left?

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If the government can do this, what -- what else can it

2

not do?

3

GENERAL VERRILLI: This does not violate the

4

norm of proper as this Court articulated it in Printz or

5

in New York because it does not interfere with the

6

States as sovereigns. This is a regulation that -- this

7

is a regulation -8

JUSTICE SCALIA: No, that wasn't my point.

9

That is not the only constitutional principle that

10

exists.

11

GENERAL VERRILLI: But it -12

JUSTICE SCALIA: An equally evident

13

constitutional principle is the principle that the

14

Federal Government is a government of enumerated powers

15

and that the vast majority of powers remain in the

16

States and do not belong to the Federal Government. Do

17

you acknowledge that that's a principle?

18

GENERAL VERRILLI: Of course we do, Your

19

Honor.

20

JUSTICE SCALIA: Okay. That's what we are

21

talking about here.

22

GENERAL VERRILLI: And the way in which this

23

Court in its cases has policed the boundary that -- of

24

what's in the national sphere and what's in the local

25

sphere is to ask whether Congress is regulating economic

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activity with a substantial effect on interstate

2

commerce.

3

And here I think it's really impossible, in

4

view of our history, to say that Congress is invading

5

the State sphere. This is a -- this is a market in

6

which 50 percent of the people in this country get their

7

health care through their employer. There is a massive

8

Federal tax subsidy of $250 billion a year that makes

9

that much more affordable. ERISA and HIPAA regulate

10

that to ensure that the kinds of bans on pre-existing

11

condition discrimination and pricing practices that

12

occur in the individual market don't occur.

13

JUSTICE SCALIA: I don't understand your

14

point -15

GENERAL VERRILLI: This is in -16

JUSTICE SCALIA: Whatever the States have

17

chosen not to do, the Federal Government can do?

18

GENERAL VERRILLI: No, not at all.

19

JUSTICE SCALIA: I mean, the Tenth Amendment

20

says the powers not given to the Federal Government are

21

reserved, not just to the States, but to the States and

22

the people. And the argument here is that the people

23

were left to decide whether they want to buy insurance

24

or not.

25

GENERAL VERRILLI: But this -- but, Your

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Honor, this is -- what the Court has said, and I think

2

it would be a very substantial departure from what the

3

Court has said, is that when Congress is regulating

4

economic activity with a substantial effect on

5

interstate commerce, that will be upheld. And that is

6

what is going on here. And to embark on -- I would

7

submit with all due respect, to embark on the kind of

8

analysis that my friends on the other side suggest the

9

Court ought to embark on is to import Lochner-style

10

substantive due process -11

CHIEF JUSTICE ROBERTS: The key in Lochner

12

is that we were talking about regulation of the States,

13

right, and the States are not limited to enumerated

14

powers. The Federal Government is. And it seems to me

15

it's an entirely different question when you ask

16

yourself whether or not there are going to be limits on

17

the Federal power, as opposed to limits on the States,

18

which was the issue in Lochner.

19

GENERAL VERRILLI: I agree, except,

20

Mr. Chief Justice, that what the Court has said, as I

21

read the Court's cases, is that the way in which you

22

ensure that the Federal Government stays in its sphere

23

and the sphere reserved for the States is protected is

24

by policing the boundary. Is the national government

25

regulating economic activity with a substantial effect

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on interstate commerce?

2

JUSTICE KENNEDY: But the reason, the reason

3

this is concerning is because it requires the individual

4

to do an affirmative act. In the law of torts, our

5

tradition, our law has been that you don't have the duty

6

to rescue someone if that person is in danger. The

7

blind man is walking in front of a car and you do not

8

have a duty to stop him, absent some relation between

9

you. And there is some severe moral criticisms of that

10

rule, but that's generally the rule.

11

And here the government is saying that the

12

Federal Government has a duty to tell the individual

13

citizen that it must act, and that is different from

14

what we have in previous cases, and that changes the

15

relationship of the Federal Government to the individual

16

in a very fundamental way.

17

GENERAL VERRILLI: I don't think so, Justice

18

Kennedy, because it is predicated on the participation

19

of these individuals in the market for health care

20

services. Now, it happens to be that this is a market

21

in which, aside from the groups that the statute

22

excludes, virtually everybody participates. But it is a

23

regulation of their participation in that market.

24

CHIEF JUSTICE ROBERTS: Well, but it's

25

critical how you define the market. If I understand the

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law, the policies that you're requiring people to

2

purchase involve -- must contain provision for maternity

3

and newborn care, pediatric services, and substance use

4

treatment. It seems to me that you cannot say that

5

everybody is going to need substance use treatment -6

substance use treatment or pediatric services, and yet

7

that is part of what you require them to purchase.

8

GENERAL VERRILLI: Well, it's part of what

9

the statute requires the insurers to offer. And I think

10

the reason is because it's trying to define minimum

11

essential coverage because the problem -12

CHIEF JUSTICE ROBERTS: But your theory is

13

that there is a market in which everyone participates

14

because everybody might need a certain range of health

15

care services, and yet you're requiring people who are

16

not -- never going to need pediatric or maternity

17

services to participate in that market.

18

GENERAL VERRILLI: The -- with respect to

19

what insurance has to cover, Your Honor, I think

20

Congress is entitled the latitude of making the

21

judgments of what the appropriate scope of coverage is.

22

And the problem here in this market is that for -- you

23

may think you're perfectly healthy and you may think

24

that you're not -- that you're being forced to subsidize

25

somebody else, but this is not a market in which you can

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say that there is a immutable class of healthy people

2

who are being forced to subsidize the unhealthy. This

3

is a market in which you may be healthy one day and you

4

may be a very unhealthy participant in that market the

5

next day, and that is a fundamental difference, and

6

you're not going to know in which -7

CHIEF JUSTICE ROBERTS: I think you're

8

posing the question I was posing, which is that doesn't

9

apply to a lot of what you're requiring people to

10

purchase. Pediatric services, maternity services. You

11

cannot say that everybody is going to participate in the

12

substance use treatment market and yet you require

13

people to purchase insurance coverage for that.

14

GENERAL VERRILLI: Congress has got --

15

Congress is enacting economic regulation here. It has

16

latitude to define essential -- the attributes of

17

essential coverage. That doesn't -- that doesn't seem

18

to me to implicate the question of whether Congress is

19

engaging in economic regulation and solving an economic

20

problem here, and that is what Congress is doing.

21

JUSTICE ALITO: Are you denying this? If

22

you took the group of people who are subject to the

23

mandate and you calculated the amount of health care

24

services this whole group would consume and figured out

25

the cost of an insurance policy to cover the services

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that group would consume, the cost of that policy would

2

be much, much less than the kind of policy that these

3

people are now going to be required to purchase under

4

the Affordable Care Act?

5

GENERAL VERRILLI: Well, while they are

6

young and healthy, that would be true. But they are not

7

going to be young and healthy forever. They are going

8

to be on the other side of that actuarial equation at

9

some point. And of course, you don't know which among

10

that group is the person who's going to be hit by the

11

bus or get the definitive diagnosis. And that -12

JUSTICE ALITO: The point is -- no, you take

13

into account that some people in that group are going to

14

be hit by a bus, some people in that group are going to

15

unexpectedly contract or be diagnosed with a disease

16

that -- that is very expensive to treat. But if you

17

take their costs and you calculate that, that's a lot

18

less than the amount that they are going to be required

19

to pay.

20

So that you can't just justify this on the

21

basis of their trying to shift their costs off to other

22

people, can you?

23

GENERAL VERRILLI: Well, no, the people in

24

that class get benefits, too, Justice Alito. They get

25

the guaranteed-issue benefit that they would not

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otherwise have, which is an enormously valuable benefit.

2

And in terms of the -- the subsidy

3

rationale, I don't think -- I think it's -- it would be

4

unusual to say that it's an illegitimate exercise of the

5

commerce power for some people to subsidize others.

6

Telephone rates in this country for a century were set

7

via the exercise of the commerce power in a way in which

8

some people paid rates that were much higher than their

9

costs in order to subsidize -10

JUSTICE SCALIA: Only if you make phone

11

calls.

12

GENERAL VERRILLI: Well, right. But -- but

13

everybody -- to live in the modern world, everybody

14

needs a telephone. And the same thing with respect to

15

the -- you know, the dairy price supports that -- that

16

the Court upheld in Wrightwood Dairy and Rock Royal.

17

You can look at those as disadvantageous contracts, as

18

forced transfers, that -- you know, I suppose it's

19

theoretically true that you could raise your kids

20

without milk, but the reality is you've got to go to the

21

store and buy milk. And the commerce power -- as a

22

result of the exercise of the commerce power, you're

23

subsidizing somebody else -24

JUSTICE KAGAN: And this is especially true,

25

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GENERAL VERRILLI: -- because that's a

2

judgment Congress has made.

3

JUSTICE KAGAN: -- Verrilli, because in this

4

context, the subsidizers eventually become the

5

subsidized?

6

GENERAL VERRILLI: Well, that was the point

7

I was trying to make, Justice Kagan, that you're young

8

and healthy one day, but you don't stay that way, and

9

the system works over time. And so, I just don't think

10

it's a fair characterization of it. And it does get

11

back to, I think, a problem I think is important to

12

understand -13

JUSTICE SCALIA: These people not stupid.

14

They're going to buy insurance later. They're young and

15

need the money now.

16

GENERAL VERRILLI: But that's -17

JUSTICE SCALIA: When they think they have a

18

substantial risk of incurring high medical bills,

19

they'll buy insurance, like the rest of us.

20

GENERAL VERRILLI: But that's -- that's -21

JUSTICE SCALIA: I don't know why you think

22

that they're never going to buy it.

23

GENERAL VERRILLI: That's the problem,

24

Justice Scalia. That's -- and that's exactly the

25

experience that the States had that made the imposition

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of guaranteed issue and community rating not only be

2

ineffectual but be highly counterproductive. Rates, for

3

example, in New Jersey doubled or tripled, went from

4

180,000 people covered in this market down to 80,000

5

people covered in this market. In Kentucky, virtually

6

every insurer left the market.

7

And the reason for that is because when

8

people have that guarantee of -- that they can get

9

insurance, they're going to make that calculation that

10

they won't get it until they're sick and they need it.

11

And so, the pool of people in the insurance market gets

12

smaller and smaller. The rates you have to charge to

13

cover them get higher and higher. It helps fewer and

14

fewer -- insurance covers fewer and fewer people until

15

the system ends.

16

This is not a situation in which you're

17

conscripting -- you're forcing insurance companies to

18

cover very large numbers of unhealthy people -19

JUSTICE SCALIA: You could solve that

20

problem by simply not requiring the insurance company to

21

sell it to somebody who has a condition that is going to

22

require medical treatment, or at least not -- not

23

require them to sell it to him at a rate that he sells

24

it to healthy people.

25

But you don't want to do that.

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GENERAL VERRILLI: But that seems to me to

2

say, Justice Scalia, that Congress -- that's the problem

3

here. And that seems to me -4

JUSTICE SCALIA: It's a self-created

5

problem.

6

GENERAL VERRILLI: -- to say that Congress

7

cannot solve the problem through standard economic

8

regulation, and that -- and I do not think that can be

9

the premise of our understanding of the Commerce Clause.

10

JUSTICE SCALIA: Whatever -11

GENERAL VERRILLI: This is an economic

12

problem.

13

JUSTICE SCALIA: -- problems Congress's

14

economic regulation produces, whatever they are, I think

15

Congress can do something to counteract them. Here,

16

requiring somebody to enter -- to enter the insurance

17

market.

18

GENERAL VERRILLI: This is not a -- it's not

19

a problem of Congress's creation. The problem is that

20

you have 40 million people who cannot get affordable

21

insurance through the means that the rest of us get

22

affordable insurance. Congress, after long study and

23

careful deliberation, and viewing the experiences of the

24

States and the way they tried to handle this problem,

25

adopted a package of reforms. Guaranteed issue and

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community rating and subsidies and the minimum coverage

2

provision are a package of reforms that solve that

3

problem.

4

I don't -- I think it's highly artificial to

5

view this as a problem of Congress's own creation.

6

CHIEF JUSTICE ROBERTS: Is your argument

7

limited to insurance or means of paying for health care?

8

GENERAL VERRILLI: Yes. It's limited to

9

insurance.

10

CHIEF JUSTICE ROBERTS: Well, now, why is

11

that? Congress could -- once you -- once you establish

12

that you have a market for health care, I would suppose

13

Congress's power under the Commerce Clause meant they

14

had a broad scope in terms of how they regulate that

15

market. And it would be -- it would be going back to

16

Lochner if we were put in the position of saying, no,

17

you can use your commerce power to regulate insurance,

18

but you can't use your commerce power to regulate this

19

market in other ways. I think that would be a very

20

significant intrusion by the Court into Congress's

21

power.

22

So, I don't see how we can accept your -23

it's good for you in this case to say, oh, it's just

24

insurance. But once we say that there is a market and

25

Congress can require people to participate in it, as

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some would say, or as you would say, that people are

2

already participating in it, it seems to me that we

3

can't say there are limitations on what Congress can do

4

under its commerce power, just like in any other area -5

given significant deference that we accord to Congress

6

in this area, all bets are off, and you could regulate

7

that market in any rational way.

8

GENERAL VERRILLI: But this is insurance as

9

a method of payment for health care services. And that

10

--

11

CHIEF JUSTICE ROBERTS: Exactly. You're

12

worried -13

GENERAL VERRILLI: And that's -14

CHIEF JUSTICE ROBERTS: That's the area that

15

Congress has chosen to regulate. There's this health

16

care market. Everybody's in it. So, we can regulate

17

it, and we're going to look at a particular serious

18

problem, which is how people pay for it. But next year,

19

they can decide everybody's in this market; we're going

20

to look at a different problem now, and this is how

21

we're going to regulate it. And we can compel people to

22

do things -- purchase insurance, in this case; something

23

else in the next case -- because you've -- we've

24

accepted the argument that this is a market in which

25

everybody participates.

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GENERAL VERRILLI: Mr. Chief Justice, let me

2

answer that, and then if I may, I'd like to move to the

3

tax power argument.

4

JUSTICE SCALIA: Can I tell you what the

5

something else is so -- while you're answering it?

6

(Laughter.)

7

JUSTICE SCALIA: The something else is

8

everybody has to exercise, because there's no doubt that

9

lack of exercise cause -- causes illness, and that

10

causes health care costs to go up. So, the Federal

11

government says everybody has to join a -- an exercise

12

club. That's the something else.

13

GENERAL VERRILLI: No. The position we're

14

taking here would not justify that rule, Justice Scalia,

15

because health club membership is not a means of payment

16

for -- for consumption of anything in a market. And -17

CHIEF JUSTICE ROBERTS: Right. Right.

18

That's exactly right, but it doesn't seem responsive to

19

my concern that there's no reason -- once we say this is

20

within Congress's commerce power, there's no reason

21

other than our own arbitrary judgment to say all they

22

can regulate is the method of payment. They can

23

regulate other things that affect this now-conceded

24

interstate market in health care in which everybody

25

participates.

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GENERAL VERRILLI: But I think it's common

2

ground between us and the Respondents that this is an

3

interstate market in which everybody participates.

4

CHIEF JUSTICE ROBERTS: Right.

5

GENERAL VERRILLI: And they agree that

6

Congress could impose the insurance requirement at the

7

point of sale. And this is just a question of timing

8

and whether Congress's -- whether the necessary and

9

proper authority gives Congress, because of the

10

particular features of this market, the ability to

11

impose the -- the insurance, the need for insurance, the

12

maintenance of insurance before you show up to get

13

health care, rather than at the moment you get up to -14

CHIEF JUSTICE ROBERTS: Right. No, I think

15

you're just -16

GENERAL VERRILLI: -- show up to get health

17

care. And that -18

CHIEF JUSTICE ROBERTS: Unless I'm missing

19

something, I think you're just repeating the idea that

20

this is the regulation of the method of payment. And I

21

understand that argument. And it may be -22

GENERAL VERRILLI: And it is -23

CHIEF JUSTICE ROBERTS: It may be a good

24

one. But what I'm concerned about is, once we accept

25

the principle that everybody is in this market, I don't

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see why Congress's power is limited to regulating the

2

method of payment and doesn't include as it does in any

3

other area.

4

What other area have we said Congress can

5

regulate this market but only with respect to prices,

6

but only with respect to means of travel? No. Once

7

you're -- once you're in the interstate commerce and can

8

regulate it, pretty much all bets are off.

9

GENERAL VERRILLI: But we agree Congress can

10

regulate this market. ERISA regulates this market.

11

HIPAA regulates this market. The market is regulated at

12

the Federal level in very significant ways already. So,

13

I don't think that's the question, Mr. Chief Justice.

14

The question is, is there a limit to the authority that

15

we're advocating here under the commerce power? And the

16

answer is yes, because we are not advocating for a power

17

that would allow Congress to compel purchases.

18

JUSTICE ALITO: Could you just -19

GENERAL VERRILLI: Yes.

20

JUSTICE ALITO: Before you move on, could

21

you express your limiting principle as succinctly as you

22

possibly can? Congress can force people to purchase a

23

product where the failure to purchase the product has a

24

substantial effect on interstate commerce, if what? If

25

this is part of a larger regulatory scheme?

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GENERAL VERRILLI: We've got -2

JUSTICE ALITO: Is that it?

3

GENERAL VERRILLI: We've got -4

JUSTICE ALITO: Is there anything more?

5

GENERAL VERRILLI: We got two and they

6

are -- they are different. Let me state them. First,

7

with respect to the comprehensive scheme. When Congress

8

is regulating -- is enacting a comprehensive scheme that

9

it has the authority to enact that the Necessary and

10

Proper Clause gives it the authority to include

11

regulation, including a regulation of this kind, if it

12

is necessary to counteract risks attributable to the

13

scheme itself that people engage in economic activity

14

that would undercut the scheme. It's like -- it's very

15

much like Wickard in that respect. Very much like Raich

16

in that respect.

17

With respect to the -- with respect to

18

the -- considering the Commerce Clause alone and not

19

embedded in the comprehensive scheme, our position is

20

that Congress can regulate the method of payment by

21

imposing an insurance requirement in advance of the time

22

in which the -- the service is consumed when the class

23

to which that requirement applies either is or virtually

24

most certain to be in that market when the timing of

25

one's entry into that market and what you will need when

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you enter that market is uncertain and when -- when you

2

will get the care in that market, whether you can afford

3

to pay for it or not and shift costs to other market

4

participants.

5

So those -- those are our views as to -6

those are the principles we are advocating for and it's,

7

in fact, the conjunction of the two of them here that

8

makes this, we think, a strong case under the Commerce

9

Clause.

10

JUSTICE SOTOMAYOR: General, could you turn

11

to the tax clause?

12

GENERAL VERRILLI: Yes.

13

JUSTICE SOTOMAYOR: I have looked for a case

14

that involves the issue of whether something denominated

15

by Congress as a penalty was nevertheless treated as a

16

tax, except in those situations where the code itself or

17

the statute itself said treat the penalty as a tax.

18

Do you know of any case where we've done

19

that?

20

GENERAL VERRILLI: Well, I think I would

21

point the Court to the License Tax Case, where it was -22

was denominated a fee and nontax, and the Court upheld

23

it as an exercise of the taxing power, in a situation in

24

which the structure of the law was very much like the

25

structure of this law, in that there was a separate

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stand-alone provision that set the predicate and then a

2

separate provision imposing -3

JUSTICE SCALIA: But fees, you know, license

4

fees, fees for a hunting license, everybody knows those

5

are taxes. I mean, I don't think there is as much of a

6

difference between a fee and a tax as there is between a

7

penalty and a tax.

8

GENERAL VERRILLI: And that, and -- and I

9

think in terms of the tax power, I think it's useful to

10

separate this into two questions. One is a question of

11

characterization. Can this be characterized as a tax;

12

and second, is it a constitutional exercise of the

13

power?

14

With respect to the question of

15

characterization, the -- this is -- in the Internal

16

Revenue Code, it is administered by the IRS, it is paid

17

on your Form 1040 on April 15th, I think -18

JUSTICE GINSBURG: But yesterday you told

19

me -- you listed a number of penalties that are enforced

20

through the tax code that are not taxes and they are not

21

penalties related to taxes.

22

GENERAL VERRILLI: They may still be

23

exercise of the tax -- exercises of the taxing power,

24

Justice Ginsburg, as this is, and I think there isn't a

25

case in which the Court has, to my mind, suggested

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anything that bears this many indicia of a tax can't be

2

considered as an exercise of the taxing power.

3

In fact, it seems to me the License Tax

4

Cases point you in the opposite direction. And beyond

5

that your -- it seems to me the right way to think about

6

this question is whether it is capable of being

7

understood as an exercise of the tax -8

JUSTICE SCALIA: The President said it

9

wasn't a tax, didn't he?

10

GENERAL VERRILLI: Well, Justice Scalia,

11

what the -- two things about that. First, as it seems

12

to me, what matters is what power Congress was

13

exercising. And they were -- and I think it's clear

14

that the -- they were exercising the tax power as well

15

as -16

JUSTICE SCALIA: You're making two

17

arguments. Number one, it's a tax; and number two, even

18

if it isn't a tax, it's within the taxing power. I'm

19

just addressing the first.

20

GENERAL VERRILLI: What the President

21

said -22

JUSTICE SCALIA: Is it a tax or not a tax?

23

The President didn't think it was.

24

GENERAL VERRILLI: The President said it

25

wasn't a tax increase because it ought to be understood

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as an incentive to get people to have insurance. I

2

don't think it's fair to infer from that anything about

3

whether that is an exercise of the tax power or not.

4

JUSTICE GINSBURG: A tax is to raise

5

revenue, tax is a revenue-raising device, and the

6

purpose of this exaction is to get people into the

7

health care risk -- risk pool before they need medical

8

care. And so it will be successful, if it doesn't raise

9

any revenue, if it gets people to buy the insurance,

10

that's -- that's what this penalty is -- this penalty is

11

designed to affect conduct.

12

The conduct is buy health protection, buy

13

health insurance before you have a need for medical

14

care. That's what the penalty is designed to do, not to

15

raise revenue.

16

GENERAL VERRILLI: That -- that is true,

17

Justice Ginsburg. That is also true of the marijuana

18

tax that was upheld in Sanchez. That's commonly true of

19

penalties under the code. They do -- if they raise

20

revenue, they are exercises of the taxing power, but

21

their purpose is not to raise revenue. Their purpose is

22

to discourage behavior.

23

I mean, the mortgage deduction works that

24

way. When the mortgage deduction is -- it's clearly an

25

exercise of the taxing power. When it's successful, it

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raises less revenue for the Federal Government. It's

2

still an exercise of the taxing power. So, I don't -3

JUSTICE KAGAN: I suppose, though, General,

4

one question is whether the determined efforts of

5

Congress not to refer to this as a tax make a

6

difference. I mean, you're suggesting we should just

7

look to the practical operation. We shouldn't look at

8

labels. And that seems right, except that here we have

9

a case in which Congress determinedly said, this is not

10

a tax, and the question is why should that be

11

irrelevant?

12

GENERAL VERRILLI: I don't think that that's

13

a fair characterization of the actions of Congress here,

14

Justice Kagan. On the -- December 23rd, a point of

15

constitutional order was called, too, in fact, with

16

respect to this law. The floor sponsor, Senator Baucus,

17

defended it as an exercise of the taxing power. In his

18

response to the point of order, the Senate voted 60 to

19

39 on that proposition.

20

The legislative history is replete with

21

members of Congress explaining that this law is

22

constitutional as an exercise of the taxing power. It

23

was attacked as a tax by its opponents. So I don't

24

think this is a situation where you can say that

25

Congress was avoiding any mention of the tax power.

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It would be one thing if Congress explicitly

2

disavowed an exercise of the tax power. But given that

3

it hasn't done so, it seems to me that it's -- not only

4

is it fair to read this as an exercise of the tax power,

5

but this Court has got an obligation to construe it as

6

an exercise of the tax power, if it can be upheld on

7

that basis.

8

CHIEF JUSTICE ROBERTS: Why didn't Congress

9

call it a tax, then?

10

GENERAL VERRILLI: Well -11

CHIEF JUSTICE ROBERTS: You're telling me

12

they thought of it as a tax, they defended it on the tax

13

power. Why didn't they say it was a tax?

14

GENERAL VERRILLI: They might have thought,

15

Your Honor, that calling it a penalty as they did would

16

make it more effective in accomplishing its objectives.

17

But it is in the Internal Revenue Code, it is collected

18

by the IRS on April 15th. I don't think this is a

19

situation in which you can say -20

CHIEF JUSTICE ROBERTS: Well, that's the

21

reason. They thought it might be more effective if they

22

called it a penalty.

23

GENERAL VERRILLI: Well, I -- you know, I

24

don't -- there is nothing that I know of that

25

illuminates that, but certainly -50

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JUSTICE SOTOMAYOR: General, the problem

2

goes back to the limiting principle. Is this simply

3

anything that raises revenue, Congress can do?

4

GENERAL VERRILLI: No. There are certain

5

limiting principles under the -6

JUSTICE SOTOMAYOR: So there has to be a

7

limiting principle as to when -8

GENERAL VERRILLI: -- taxing power, and

9

they -- and I think, of course, the Constitution imposes

10

some, got to be uniform, can't be taxed on exports, if

11

it's a direct tax, it's got to be apportioned. Beyond

12

that, the limiting principle, as the Court has

13

identified from Drexel Furniture to Kurth Ranch, is that

14

it can't be punishment, punitive in the guise of a tax.

15

And there are three factors the Court has identified to

16

look at that.

17

The first is the sanction and how

18

disproportionate it is to the conduct; the second is

19

whether there is scienter; and the third is whether

20

there is an administrative apparatus out there to

21

enforce the tax.

22

Now, in Bailey against Drexel Furniture, for

23

example, the tax was 10 percent of the company's

24

profits, even if they had only one child laborer for one

25

day. There was a scienter requirement, and it was

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enforced by the Department of Labor. It wasn't just

2

collected by the Internal Revenue Service.

3

Here you don't have any of those things.

4

This -- the penalty is calculated to be no more than, at

5

most, the equivalent of what one would have paid for

6

insurance if you forgone. There is no scienter

7

requirement, there is no enforcement apparatus out

8

there. So, certain -9

JUSTICE ALITO: Can the -- can the mandate

10

be viewed as a tax if it does impose a requirement on

11

people who are not subject to the penalty or the tax?

12

GENERAL VERRILLI: I think it could, for the

13

reasons I -- I discussed yesterday. I don't think it

14

can or should be read that way. But if there is any

15

doubt about that, Your Honor, if there is -- if it is

16

the view of the Court that it can't be, then I think

17

the right way to handle this case is by analogy to New

18

York against United States, in which the -- the Court

19

read the shall provision, shall handle low level

20

radioactive waste as setting the predicate, and then the

21

other provisions were merely incentives to get the

22

predicate met, and so -23

JUSTICE SCALIA: You're saying that all the

24

discussion we had earlier about how this is one big

25

uniform scheme and the Commerce Clause, blah, blah,

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blah, it really doesn't matter. This is a tax and the

2

Federal Government could simply have said, without all

3

of the rest of this legislation, could simply have said,

4

everybody who doesn't buy health insurance at a certain

5

age will be taxed so much money, right?

6

GENERAL VERRILLI: It -- it used its powers

7

together to solve the problem of the market not -8

JUSTICE SCALIA: Yes, but you didn't need

9

that.

10

GENERAL VERRILLI -- providing affordable

11

coverage -12

JUSTICE SCALIA: You didn't need that. If

13

it's a tax, it's only -- raising money is enough.

14

GENERAL VERRILLI: It is justifiable under

15

its tax power.

16

JUSTICE SCALIA: Okay. Extraordinary.

17

GENERAL VERRILLI: If I may reserve the

18

balance of my time.

19

CHIEF JUSTICE ROBERTS: Thank you, General.

20

We'll take a pause for a minute or so,

21

Mr. Clement.

22

(Pause.)

23

CHIEF JUSTICE ROBERTS: All right. Why

24

don't we get started again.

25

Mr. Clement.

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ORAL ARGUMENT OF PAUL D. CLEMENT

2

ON BEHALF OF THE RESPONDENTS FLORIDA, ET AL.

3

MR. CLEMENT: Mr. Chief Justice, and may it

4

please the Court. The mandate represents an

5

unprecedented effort by Congress to compel individuals

6

to enter commerce in order to better regulate commerce.

7

The Commerce Clause gives Congress the power

8

to regulate existing commerce. It does not give

9

Congress the far greater power to compel people to enter

10

commerce, to create commerce essentially in the first

11

place.

12

Now, Congress when it passed the statute did

13

make findings about why it thought it could regulate the

14

commerce here, and it justified the mandate as a

15

regulation of the economic decision to forgo the

16

purchase of health insurance. That is a theory without

17

any limiting principle.

18

JUSTICE SOTOMAYOR: Do you accept here the

19

General's position that you have conceded that Congress

20

could say, if you're going to consume health services,

21

you have to pay by way of insurance?

22

MR. CLEMENT: That's right,

23

Justice Sotomayor. We say, consistent with 220 years of

24

this Court's jurisprudence, that if you regulate the

25

point of sale, you regulate commerce, that's within

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Congress's commerce power.

2

JUSTICE SOTOMAYOR: All right. So, what do

3

you do with the impossibility of buying insurance at the

4

point of consumption. Virtually, you force insurance

5

companies to sell it to you?

6

MR. CLEMENT: Well, Justice, I think there's

7

two points to make on that. One is a lot of the

8

discussion this morning so far has proceeded on the

9

assumption that the only thing that's at issue here is

10

emergency room visits, and the only thing that's being

11

imposed is catastrophic care coverage. But, as the

12

Chief Justice indicated earlier, a lot of the insurance

13

that's being covered is for ordinary preventive care,

14

ordinary office visits, and those are the kinds of

15

things that one can predict.

16

So, there's a big part of the market that's

17

regulated here that wouldn't pose the problem that

18

you're suggesting; but, even as to emergency room

19

visits, it certainly would be possible to regulate at

20

that point. You could simply say, through some sort of

21

mandate on the insurance companies, you have to provide

22

people that come in -- this will be a high-risk pool,

23

and maybe you'll have to share it amongst yourself or

24

something, but people simply have to sign up at that

25

point, and that would be regulating at the point of

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sale.

2

JUSTICE KAGAN: Well, Mr. Clement, now it

3

seems as though you're just talking about a matter of

4

timing, that Congress can regulate the transaction. And

5

the question is when does it make best sense to regulate

6

that transaction?

7

And Congress surely has it within its

8

authority to decide, rather than at the point of sale,

9

given an insurance-based mechanism, it makes sense to

10

regulate it earlier. It's just a matter of timing.

11

MR. CLEMENT: Well, Justice Kagan, we don't

12

think it's a matter of timing alone, and we think it has

13

very significant substantive effects, because if

14

Congress tried to regulate at the point of sale, the one

15

group that it wouldn't capture at all are the people who

16

don't want to purchase health insurance and also have no

17

plans of using health care services in the near term.

18

And Congress very much wanted to capture those people.

19

I mean, those people are essentially the golden geese

20

that pay for the entire lowering of the premium -21

JUSTICE KENNEDY: Is the government's

22

argument this -- and maybe I won't state it accurately.

23

It is true that the noninsured young adult is, in fact,

24

an actuarial reality insofar as our allocation of health

25

services, insofar as the way health insurance companies

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figure risks. That person who is sitting at home in his

2

or her living room doing nothing is an actuarial reality

3

that can and must be measured for health service

4

purposes; is that their argument?

5

MR. CLEMENT: Well, I don't know,

6

Justice Kennedy, but, if it is, I think there's at least

7

two problems with it.

8

One is, as Justice Alito's question

9

suggested earlier -- I mean, somebody who is not in the

10

insurance market is sort of irrelevant as an actuarial

11

risk. I mean, we could look at the people not in the

12

insurance market, and what we'd find is that they're

13

relatively young, relatively healthy, and they would

14

have a certain pool of actuarial risks that would

15

actually lead to lower premiums.

16

The people that would be captured by

17

guaranteed rating and community issue -- guaranteed

18

issue and community rating would presumably have a

19

higher risk profile, and there would be higher premiums.

20

And one of the things, one of the things,

21

Congress sought to accomplish here was to force

22

individuals into the insurance market to subsidize those

23

that are already in it to lower the rates. And that's

24

just not my speculation, that's Finding (I) at 43a of

25

the Government's brief that -- it has the statute. And

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that's one of the clear findings.

2

JUSTICE GINSBURG: Mr. Clement, doesn't that

3

work -- that work the way Social Security does?

4

Let me put it this way: Congress, in the

5

'30s, saw a real problem of people needing to have old

6

age and survivor's insurance. And, yes, they did it

7

through a tax, but they said everybody has got to be in

8

it because if we don't have the healthy in it, there's

9

not going to be the money to pay for the ones who become

10

old or disabled or widowed. So, they required everyone

11

to contribute.

12

There was a big fuss about that in the

13

beginning because a lot of people said -- maybe some

14

people still do today -- I could do much better if the

15

government left me alone. I'd go into the private

16

market, I'd buy an annuity, I'd make a great investment,

17

and they're forcing me to paying for this Social

18

Security that I don't want.

19

But that's constitutional. So, if Congress

20

could see this as a problem when we need to have a group

21

that will subsidize the ones who are going to get the

22

benefits, it seems to me you're saying the only way that

23

could be done is if the government does it itself; it

24

can't involve the private market, it can't involve the

25

private insurers. If it wants to do this, Social

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Security is its model. The government has to do -2

there has to be government takeover. We can't have the

3

insurance industry in it. Is that your position?

4

MR. CLEMENT: No. I don't think it is,

5

Justice Ginsburg. I think there are other options that

6

are available.

7

The most straightforward one would be to

8

figure out what amount of subsidy to the insurance

9

industry is necessary to pay for guaranteed issue and

10

community rating. And once we calculate the amount of

11

that subsidy, we could have a tax that's spread

12

generally through everybody to raise the revenue to pay

13

for that subsidy. That's the way we pay for most

14

subsidies.

15

JUSTICE SOTOMAYOR: Could we have an

16

exemption? Could the government say everybody pays a

17

shared health care responsibility payment to offset all

18

the money that we're forced to spend on health care, we

19

the government; but anybody who has an insurance policy

20

is exempt from that tax? Could the government do that?

21

MR. CLEMENT: The government might be able

22

to do that. I think it might raise some issues about

23

whether or not that would be a valid exercise of the

24

taxing power.

25

JUSTICE SOTOMAYOR: Under what theory

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wouldn't it be?

2

MR. CLEMENT: Well, I do think that -3

JUSTICE SOTOMAYOR: We get tax credits for

4

having solar-powered homes. We get tax credits for

5

using fuel-efficient cars. Why couldn't we get a tax

6

credit for having health insurance and saving the

7

government from caring for us.

8

MR. CLEMENT: Well, I think it would depend

9

a little bit on how it was formulated, but my concern

10

would be -- the constitutional concern would be that it

11

would just be a disguised impermissible direct tax. And

12

I do think -- you know, I mean, I don't want to suggest

13

we get to the taxing power to soon, but I do think it's

14

worth realizing that the taxing power is limited in the

15

ability to impose direct taxes.

16

And the one thing I think the Framers would

17

have clearly identified as a direct tax is a tax on not

18

having something. I mean, the framing generation was

19

divided over whether a tax on carriages was a direct tax

20

or not. Hamilton thought that was a indirect tax;

21

Madison thought it was a direct tax. I have little

22

doubt that both of them would have agreed that a tax on

23

not having a carriage would have clearly been a direct

24

tax. I also think they would have thought it clearly

25

wasn't a valid regulation of the market in carriages.

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And, you know, I mean, if you look at Hylton

2

v. The United States, that's this Court's first direct

3

tax case.

4

JUSTICE BREYER: Let me ask -- can I go back

5

for a step? Because I don't want to get into a

6

discussion of whether this is a good bill or not. Some

7

people think it's going to save a lot of money. Some

8

people think it won't.

9

So, I'm focusing just on the Commerce

10

Clause; not on the Due Process Clause, the Commerce

11

Clause. And I look back into history, and I think if we

12

look back into history, we see sometimes Congress can

13

create commerce out of nothing. That's the national

14

bank, which was created out of nothing to create other

15

commerce out of nothing.

16

I look back into history, and I see it seems

17

pretty clear that if there are substantial effects on

18

interstate commerce, Congress can act.

19

And I look at the person who's growing

20

marijuana in her house, or I look at the farmer who is

21

growing wheat for home consumption. This seems to have

22

more substantial effects.

23

Is this commerce? Well, it seems to me more

24

commerce than marijuana. I mean, is it, in fact, a

25

regulation? Well, why not? If creating a bank is, why

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isn't this?

2

And then you say, ah, but one thing here out

3

of all those things is different, and that is you're

4

making somebody do something.

5

I say, hey, can't Congress make people drive

6

faster than 45 -- 40 miles an hour on a road? Didn't

7

they make that man growing his own wheat go into the

8

market and buy other wheat for his -- for his cows?

9

Didn't they make Mrs. -- if she married somebody who had

10

marijuana in her basement, wouldn't she have to go and

11

get rid of it? Affirmative action?

12

I mean, where does this distinction come

13

from? It sounds like sometimes you can, and sometimes

14

you can't.

15

So what is argued here is there is a large

16

group of -- what about a person that we discover that

17

there are -- a disease is sweeping the United States,

18

and 40 million people are susceptible, of whom 10

19

million will die; can't the Federal Government say all

20

40 million get inoculation?

21

So here, we have a group of 40 million, and

22

57 percent of those people visit emergency care or other

23

care, which we are paying for. And 22 percent of those

24

pay more than $100,000 for that. And Congress says they

25

are in the midst of this big thing. We just want to

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rationalize this system they are already in.

2

So, there, you got the whole argument, and I

3

would like you to tell me -4

JUSTICE SCALIA: Answer those questions in

5

inverse order.

6

JUSTICE BREYER: Well, no, it's one

7

question. It's looking back at that -- looking back at

8

that history.

9

The thing I can see that you say to some

10

people, go buy. Why does that make a difference in

11

terms of the Commerce Clause?

12

MR. CLEMENT: Well, Justice Breyer, let me

13

start at the beginning of your question with McCulloch.

14

McCulloch was not a commerce power case.

15

JUSTICE BREYER: It was both?

16

MR. CLEMENT: No, the bank was not justified

17

and the corporation was not justified as an exercise of

18

commerce power. So that is not a case that says that

19

it's okay to conjure up the bank as an exercise of the

20

commerce power.

21

And what, of course, the Court didn't say,

22

and I think the Court would have had a very different

23

reaction to, is, you know, we are not just going to have

24

the bank, because that wouldn't be necessary and proper,

25

we are going to force the citizenry to put all of their

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money in the bank, because, if we do that, then we know

2

the Bank of the United States will be secure.

3

I think the framers would have identified

4

the difference between those two scenarios, and I don't

5

think that the great Chief Justice would have said that

6

forcing people to put their deposits in the Bank of the

7

United States was necessary and proper.

8

Now, if you look through all the cases you

9

mentioned, I do not think you will find a case like

10

this. And I think it's telling that you won't. I mean,

11

the regulation of the wheat market in Wickard against

12

Filburn, all this effort to address the supply side and

13

what producers could do, what Congress was trying to do

14

was support the price of wheat. It would have been much

15

more efficient to just make everybody in America buy 10

16

loaves of bread. That would have had a much more direct

17

effect on the price of wheat in the prevailing market.

18

But we didn't do that. We didn't say when

19

we had problems in the automobile industry that we are

20

not just going to give you incentives, not just cash for

21

clunkers, we are going to actually have everybody over

22

100,000 dollars has to buy a new car -23

CHIEF JUSTICE ROBERTS: Well, Mr. Clement,

24

the key to the government's argument to the contrary is

25

that everybody is in this market. It's all right to

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regulate Wickard -- again, in Wickard against Filburn,

2

because that's a particular market in which the farmer

3

had been participating.

4

Everybody is in this market, so that makes

5

it very different than the market for cars or the other

6

hypotheticals that you came up with, and all they're

7

regulating is how you pay for it.

8

MR. CLEMENT: Well, with respect, Mr. Chief

9

Justice, I suppose the first thing you have to say is

10

what market are we talking about? Because the

11

government -- this statute undeniably operates in the

12

health insurance market. And the government can't say

13

that everybody is in that market. The whole problem is

14

that everybody is not in that market, and they want to

15

make everybody get into that market.

16

JUSTICE KAGAN: Well, doesn't that seem a

17

little bit, Mr. Clement, cutting the baloney thin? I

18

mean, health insurance exists only for the purpose of

19

financing health care. The two are inextricably

20

interlinked. We don't get insurance so that we can

21

stare at our insurance certificate. We get it so that

22

we can go and access health care.

23

MR. CLEMENT: Well, Justice Kagan, I'm not

24

sure that's right. I think what health insurance does

25

and what all insurance does is it allows you to

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diversify risk. And so it's not just a matter of I'm

2

paying now instead of paying later. That's credit.

3

Insurance is different than credit. Insurance

4

guarantees you an upfront, locked-in payment, and you

5

won't have to pay any more than that even if you incur

6

much great expenses.

7

And in every other market that I know of for

8

insurance, we let people basically make the decision

9

whether they are relatively risk averse, whether they

10

are relatively non-risk averse, and they can make the

11

judgment based on -12

JUSTICE SOTOMAYOR: But we don't in car

13

insurance, meaning we tell people, buy car -- not we,

14

the States do, although you're going to -- I'll ask you

15

the question, do you think that if some States decided

16

not to impose an insurance requirement, that the Federal

17

Government would be without power to legislate and

18

require every individual to buy car insurance?

19

MR. CLEMENT: Well, Justice Sotomayor, let

20

me say this, which is to say -- you're right in the

21

first point to say that it's the States that do it,

22

which makes it different right there. But it's also -23

JUSTICE SOTOMAYOR: Well, that goes back to

24

the substantive due process question. Is this a Lochner

25

era argument that only the States can do this, even

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though it affects commerce? Cars indisputably affect

2

commerce. So are you arguing that because the States

3

have done it all along, the Federal Government is no

4

longer permitted to legislate in this area?

5

MR. CLEMENT: No. I think you might make a

6

different argument about cars than you would make about

7

health insurance, unless you tried to say -- but, you

8

know, we're -9

JUSTICE SOTOMAYOR: Health insurance -- I

10

mean, I've never gotten into an accident, thankfully,

11

and I hope never. The vast majority of people have

12

never gotten into an accident where they have injured

13

others; yet, we pay for it dutifully every year on the

14

possibility that at some point, we might get into that

15

accident.

16

MR. CLEMENT: But, Justice Sotomayor, what I

17

think is different is there is lots of people in

18

Manhattan, for example, that don't have car insurance

19

because they don't have cars. And so they have the

20

option of withdrawing from that market. It's not a

21

direct imposition from the government.

22

So even the car market is difference from

23

this market, where there is no way to get outside of the

24

regulatory web. And that's, I think, one of the real

25

problems with this because, I mean, we take as a

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given -2

JUSTICE SOTOMAYOR: But you're -- but the

3

given is that virtually everyone, absent some

4

intervention from above, meaning that someone's life

5

will be cut short in a fatal way, virtually everyone

6

will use health care.

7

MR. CLEMENT: At some point, that's right,

8

but all sorts of people will not, say, use health care

9

in the next year, which is the relevant period for the

10

insurance.

11

JUSTICE BREYER: But do you think you can,

12

better than the actuaries or better than the members of

13

Congress who worked on it, look at the 40 million people

14

who are not insured and say which ones next year will or

15

will not use, say, emergency care?

16

Can you do that any better than if we knew

17

that 40 million people were suffering, about to suffer a

18

contagious disease, and only 10 million would get

19

sick -20

MR. CLEMENT: Of course not -21

JUSTICE BREYER: -- and we don't know which?

22

MR. CLEMENT: Of course not, Justice Breyer,

23

but the point is that once Congress decides it's going

24

to regulate extant commerce, it is going to get all

25

sorts of latitude to make the right judgments about

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actuarial predictions, which actuarial to rely on, which

2

one not to rely on.

3

The question that's a proper question for

4

this Court, though, is whether or not, for the first

5

time ever in our history, Congress also has the power to

6

compel people into commerce, because, it turns out, that

7

would be a very efficient things for purposes of

8

Congress's optimal regulation of that market.

9

JUSTICE KAGAN: But, Mr. Clement, this goes

10

back to the Chief Justice's question. But, of course,

11

the theory behind, not just the government's case, but

12

the theory behind this law is that people are in this

13

market right now, and they are in this market because

14

people do get sick, and because when people get sick, we

15

provide them with care without making them pay.

16

And it would be different, you know, if you

17

were up here saying, I represent a class of Christian

18

Scientists. Then you might be able to say, look, you

19

know, why are they bothering me. But absent that,

20

you're in this market. You're an economic actor.

21

MR. CLEMENT: Well, Justice Kagan, once

22

again, it depends on which market we're talking about.

23

If we're talking about the health care insurance

24

market -25

JUSTICE KAGAN: Well, we are talking about

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the health insurance market, which is designed to access

2

the health care market.

3

MR. CLEMENT: And with respect to the health

4

insurance market that's designed to have payment in the

5

health care market, everybody is not in the market. And

6

that's the premise of the statute, and that's the

7

problem Congress is trying to solve.

8

And if it tried to solve it through

9

incentives, we wouldn't be here; but, it's trying to

10

solve it in a way that nobody has ever tried to solve an

11

economic problem before, which is saying, you know, it

12

would be so much more efficient if you were just in this

13

market -14

JUSTICE KENNEDY: But they are in the market

15

in the sense that they are creating a risk that the

16

market must account for.

17

MR. CLEMENT: Well, Justice Kennedy, I don't

18

think that's right, certainly in any way that

19

distinguishes this from any other context. When I'm

20

sitting in my house deciding I'm not going to buy a car,

21

I am causing the labor market in Detroit to go south. I

22

am causing maybe somebody to lose their job, and for

23

everybody to have to pay for it under welfare. So, the

24

cost shifting that the government tries to uniquely

25

associate with this market -- it's everywhere.

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And even more to the point, the rationale

2

that they think ultimately supports this legislation,

3

that, look, it's an economic decision; once you make the

4

economic decision, we aggregate the decision; there's

5

your substantial effect on commerce. That argument

6

works here. It works in every single industry.

7

JUSTICE BREYER: Of course, we do know that

8

there are a few people, more in New York City than there

9

are in Wyoming, who never will buy a car. But we also

10

know here, and we don't like to admit it, that because

11

we are human beings, we all suffer from the risk of

12

getting sick, and we also all know that we'll get

13

seriously sick. And we also know that we can't predict

14

when. And we also know that when we do, there will be

15

our fellow taxpayers through the Federal Government who

16

will pay for this. If we do not buy insurance, we will

17

pay nothing. And that happens with a large number of

18

people in this group of 40 million, none of whom can be

19

picked out in advance.

20

Now, that's quite different from the car

21

situation, and it's different in only this respect: It

22

shows there is a national problem, and it shows there is

23

a national problem that involves money, cost, insurance.

24

So, if Congress could do this, should there be a disease

25

that strikes the United States and they want every one

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inoculated even though 10 million will be hurt, it's

2

hard for me to decide why that isn't interstate

3

commerce, even more so where we know it affects

4

everybody.

5

MR. CLEMENT: Well, Justice Breyer, there

6

are other markets that affect every one -7

transportation, food, burial services -- though we don't

8

like to talk about that either. There also are

9

situations where there are many economic effects from

10

somebody's failure to purchase a product.

11

And if I could -- if I could talk about the

12

difference between the health insurance market and the

13

health care market, I mean, ultimately I don't want you

14

to leave here with the impression that anything turns on

15

that. Because if the government decided tomorrow that

16

they've come up with a great -- somebody -- some private

17

company has come up with a great new wonder drug that

18

would be great for everybody to take, it would have huge

19

health benefits for everybody; and by the way, also, if

20

everybody had to buy it, it would facilitate economies

21

of scale, and the production would be great, and the

22

price would be cheaper -- and force everybody in the

23

health care market, the actual health care market, to

24

buy the wonder drug, I'd be up here making the same

25

argument.

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I'd be saying that's not a power that's

2

within the commerce power of the Federal Government. It

3

is something much greater. And it would have been much

4

more controversial. That's one of the important things.

5

In Federalist 45, Madison says the commerce power -6

that's a new power, but it's not one anyone has any

7

apprehension about.

8

The reason they didn't have any apprehension

9

about it is because it's a power that only operated once

10

people were already in commerce. You see that from the

11

text of the clause. The first kind of commerce Congress

12

gets to regulate is commerce with foreign nations. Did

13

anybody think the fledgling Republic had the power to

14

compel some other nation into commerce with us? Of

15

course not. And in the same way, I think if the Framers

16

had understood the commerce power to include the power

17

to compel people to engage in commerce -18

JUSTICE KAGAN: Well, once again, though,

19

who's in commerce and when are they in commerce?

20

If the effect of all these uninsured people

21

is to raise everybody's premiums, not just when they get

22

sick, if they get sick, but right now in the aggregate,

23

and Wickard and Raich tell us we should look at the

24

aggregate, and the aggregate of all these uninsured

25

people are increasing the normal family premium,

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Congress says, by a thousand dollars a year -- those

2

people are in commerce. They are making decisions that

3

are affecting the price that everybody pays for this

4

service.

5

MR. CLEMENT: Justice Kagan, again, with all

6

due respect, I don't think that's a limiting principle.

7

My unwillingness to buy an electric car is forcing up

8

the price of an electric car. If only more people

9

demanded an electric car, there would be economies of

10

scale, and the price would go down.

11

JUSTICE KAGAN: No, this is very different,

12

Mr. Clement, and it's different because of the nature of

13

the health care service, that you are entitled to health

14

care when you go to an emergency room, when you go to a

15

doctor, even if you can't pay for it. So, the

16

difference between your hypotheticals and the real case

17

is the problem of uncompensated care, which -18

MR. CLEMENT: Justice Kagan, first of all, I

19

do think there -- this is not the only place where

20

there's uncompensated care. If some -- if I don't buy a

21

car and somebody goes on welfare, I'm going to end up

22

paying for that as well.

23

But let me also say that there's a real

24

disconnect then between that focus on what makes this

25

different and the statute that Congresses passed. If

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all we were concerned about is the cost sharing that

2

took place because of uncompensated care in emergency

3

rooms, presumably we'd have before us a statute that

4

only addressed emergency care and catastrophic insurance

5

coverage. But it covers everything, soup to nuts, and

6

all sorts of other things.

7

And that gets at the idea that there's two

8

kinds of cost shifting that are going on here. One is

9

the concern about emergency care and that somehow

10

somebody who gets sick is going to shift costs back to

11

other policy areas -- holders. But there's a much

12

bigger cost shifting going on here, and that's the cost

13

shifting that goes on when you force healthy people into

14

an insurance market precisely because they're healthy,

15

precisely because they're not likely to go to the

16

emergency room, precisely because they're not likely to

17

use the insurance they're forced to buy in the health

18

care insurance. That creates a huge windfall. It

19

lowers the price of premiums.

20

And, again, this isn't just some lawyer up

21

here telling you that's what it does and trying to

22

second-guess the congressional economic decisions. This

23

is Congress's findings, Findings (I) on page 43a of the

24

appendix to the Government's brief.

25

JUSTICE BREYER: All right. But all that

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sounds like you're debating the merits of the bill. You

2

asked really for limiting principles so we don't get

3

into a matter that I think has nothing to do with this

4

case: broccoli. Okay?

5

And the limiting principles -- you've heard

6

three. First, the Solicitor General came up with a

7

couple joined, very narrow ones. You've seen in Lopez

8

this Court say that we cannot -- Congress cannot get

9

into purely local affairs, particularly where they are

10

noncommercial. And, of course, the greatest limiting

11

principle of all, which not too many accept, so I'm not

12

going to emphasize that, is the limiting principle

13

derived from the fact that members of Congress are

14

elected from States and that 95 percent of the law of

15

the United States is State law. That is a principle,

16

though enforced by the legislature. The other two are

17

principles, one written into Lopez and one you just

18

heard.

19

It seems to me all of those eliminate the

20

broccoli possibility, and none of them eliminates the

21

possibility that we're trying to take the 40 million

22

people who do have the medical cost, who do affect

23

interstate commerce, and provide a system that you may

24

like or not like.

25

MR. CLEMENT: Well, Justice Breyer, let me

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take them turn.

2

JUSTICE BREYER: That's where we are in

3

limiting principles.

4

MR. CLEMENT: Let me take them in turn. I

5

would encourage this Court not to Garcia-ize the

6

Commerce Clause and just simply say it's up to Congress

7

to police the Commerce Clause. So, I don't think that

8

is a limiting principle.

9

Second of all -10

JUSTICE SOTOMAYOR: But that's exactly what

11

Justice Marshall said in Gibbons. He said that it is

12

the power to regulate; the power like all others vested

13

in Congress is complete in itself, may be exercised to

14

its utmost extent, and acknowledges no limitations other

15

than those prescribed in the Constitution. But there is

16

no conscription in the -- set forth in the Constitution

17

--

18

MR. CLEMENT: I agree -19

JUSTICE SOTOMAYOR: -- with respect to

20

regulating commerce.

21

MR. CLEMENT: I agree 100 percent, and I

22

think that was the Chief Justice's point, which was once

23

you open the door to compelling people into commerce

24

based on the narrow rationales that exist in this

25

industry, you are not going to be able to stop that

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process.

2

JUSTICE SOTOMAYOR: Well, see, that's the -3

JUSTICE SCALIA: I would like hear you

4

address Justice Breyer's other two principles.

5

MR. CLEMENT: Well, the other two principles

6

are Lopez -- and this case really is not -- I mean, you

7

know, Lopez is a limit on the affirmative exercise of

8

people who are already in commerce. The question is, is

9

there any other limit to people who aren't in commerce?

10

And so, I think this is the case that really asks that

11

question.

12

And then the first point which was -- I take

13

it to be the Solicitor General's point, is, with all due

14

respect, simply a description of the insurance market.

15

It's not a limiting principle, because the justification

16

for why this is a valid regulation of commerce is in no

17

way limited to this market. It simply says these are

18

economic decisions; they have effect on other people; my

19

failure to purchase in this market has a direct effect

20

on others who are already in the market. That's true of

21

virtually every other market under the sun.

22

CHIEF JUSTICE ROBERTS: And now maybe return

23

to Justice Sotomayor's question.

24

MR. CLEMENT: I'd be delighted to, which is

25

-- I mean, I -- you're absolutely right. Once you're in

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the commerce power, there -- this Court is not going to

2

police that subject maybe to the Lopez limit. And

3

that's exactly why I think it's very important for this

4

Court to think seriously about taking an unprecedented

5

step of saying that the commerce power not only includes

6

the power to regulate, prescribe the rule by which

7

commerce is governed, the rule of Gibbons v. Ogden; but

8

to go further and say it's not just prescribing the rule

9

for commerce that exists but is the power to compel

10

people to enter into commerce in the first place.

11

I'd like to say two very brief things about

12

the taxing power, if I could. There are lots of reasons

13

why this isn't a tax. It wasn't denominated a tax.

14

It's not structured as a tax. If it's any tax at all,

15

though, it is a direct tax. Article I, section 9,

16

clause 4 -- the Framers would have had no doubt that a

17

tax on not having something is not an excise tax but a

18

forbidden direct tax. That's one more reason why this

19

is not proper legislation, because it violates that.

20

The second thing is I would urge you to read

21

the license tax case which the Solicitor General says is

22

his best case for why you ignore the fact that a tax is

23

denominated into something other. Because that's a case

24

where the argument was that because the Federal

25

Government had passed a license, not a tax, that somehow

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that allowed people to take actions that would have been

2

unlawful under State law, that this was some special

3

Federal license to do something that was forbidden by

4

State law. This Court looked beyond the label in order

5

to preserve federalism there.

6

What the Solicitor General and the

7

government ask you to do here is exactly the opposite,

8

which is to look past labels in order to up-end our

9

basic federalist system. In this -10

JUSTICE SOTOMAYOR: Could you tell me, do

11

you think the States could pass this mandate?

12

MR. CLEMENT: I represent 26 States. I do

13

think the States could pass this mandate, but I -14

JUSTICE SOTOMAYOR: Is there any other area

15

of commerce, business, where we have held that there

16

isn't concurrent power between the State and the Federal

17

Government to protect the welfare of commerce?

18

MR. CLEMENT: Well, Justice Sotomayor, I

19

have to resist your premise, because I didn't answer

20

yes, the States can do it because it would be a valid

21

regulation of intrastate commerce. I said yes, the

22

States can do it because they have a police power, and

23

that is the fundamental difference between the States on

24

the one hand and the limited, enumerated Federal

25

Government on the other.

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CHIEF JUSTICE ROBERTS: Thank you,

2

Mr. Clement.

3

Mr. Carvin.

4

ORAL ARGUMENT OF MICHAEL A. CARVIN

5

ON BEHALF OF THE RESPONDENTS NFIB, ET AL.

6

MR. CARVIN: Thank you, Mr. Chief Justice;

7

may it please the Court:

8

I'd like to begin with the Solicitor

9

General's main premise, which is that they can compel

10

the purchase of health insurance in order to promote

11

commerce in the health market because it will reduce

12

uncompensated care. If you accept that argument, you

13

have to fundamentally alter the text of the Constitution

14

and give Congress plenary power.

15

It simply doesn't matter whether or not this

16

regulation will promote health care commerce by reducing

17

uncompensated care. All that matters is whether the

18

activity actually being regulated by the act negatively

19

affects Congress or negatively affects commerce

20

regulation, so that it's within the commerce power. If

21

you agree with us that this is -- exceeds commerce

22

power, the law doesn't somehow become redeemed because

23

it has beneficial policy effects in the health care

24

market.

25

In other words, Congress does not have the

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power to promote commerce. Congress has -- Congress has

2

the power to regulate commerce. And if the power

3

exceeds their permissible regulatory authority, then the

4

law is invalid.

5

CHIEF JUSTICE ROBERTS: Well, surely -6

MR. CARVIN: I'm sorry.

7

CHIEF JUSTICE ROBERTS: Well, surely

8

regulation includes the power to promote. Since the New

9

Deal we've said that regulation in -- there is a market

10

in agricultural products; Congress has the power to

11

subsidize, to limit production, all sorts of things.

12

MR. CARVIN: Absolutely, Chief Justice, and

13

that's the distinction I'm trying to draw. When they

14

are acting within their enumerated power, then obviously

15

they are promoting commerce.

16

But the Solicitor General wants to turn it

17

into a different power. He wants to say we have the

18

power to promote commerce, to regulate anything to

19

promote commerce. And if they have the power to promote

20

commerce, then they have the power to regulate

21

everything, right? Because -22

CHIEF JUSTICE ROBERTS: I don't -- I don't

23

think you're addressing their main point, which is that

24

they are not creating commerce in -- in health care.

25

It's already there, and we are all going to need some

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kind of health care; most of us will at some point.

2

MR. CARVIN: I'd -- I'd like to address that

3

in two ways, if I could, Mr. Chief Justice. In the

4

first place, they keep playing mix and match with the

5

statistics. They say 95 percent of us are in the health

6

care market, okay? But that's not the relevant

7

statistic, even as the government frames the issue. No

8

one in Congress and the Solicitor General is arguing

9

that going to the doctor and fully paying him creates a

10

problem. The problem is uncompensated care, and they

11

say the uncompensated care arises if you have some kind

12

of catastrophe -- hit by a bus, have some prolonged

13

illness. Well, what is the percentage of the uninsured

14

that have those sorts of catastrophes? We know it has

15

got to be a relative small fraction. So in other words,

16

the relevant -17

CHIEF JUSTICE ROBERTS: Yet we don't know

18

who they are.

19

MR. CARVIN: We don't, no, and we don't know

20

in advance, and -- and --

but that doesn't change the

21

basic principle, that you are nonetheless forcing people

22

for paternalistic reasons to go into the insurance

23

market to insure against risk that they have made the

24

voluntary decision that they are not -- have decided not

25

to. But even -83

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JUSTICE GINSBURG: But the problem is -- the

2

problem is that they are making the rest of us pay for

3

it, because as much as they say, well, we are not in the

4

market, we don't know when the -- the timing when they

5

will be.

6

MR. CARVIN: Which is -7

JUSTICE GINSBURG: And the -- the figures of

8

how much more families are paying for insurance because

9

people get sick, they may have intended to self-insure,

10

they haven't been able to meet the bill for -- for

11

cancer, and the rest of us end up paying because these

12

people are getting cost-free health care, and the only

13

way to prevent that is to have them pay sooner rather

14

than later, pay up front.

15

MR. CARVIN: Yes, but my point is this.

16

That, with respect, Justice Ginsburg, conflicts the

17

people who do result in uncompensated care, the free

18

riders. Those are people who default on their health

19

care payments. That is an entirely different group of

20

people, an entirely different activity than being

21

uninsured.

22

So the question is whether or not you can

23

regulate activity because it has a statistical

24

connection to an activity that harms Congress. And my

25

basic point to you is this: the Constitution only gives

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Congress the power to regulate things that negatively

2

affect commerce or commerce regulation. It doesn't give

3

them the power to regulate things that are statistically

4

connected to things that negatively affect the

5

commerce -6

JUSTICE KAGAN: Well, Mr. Carvin -7

MR. CARVIN: Because -- I'm sorry.

8

JUSTICE KAGAN: Please.

9

MR. CARVIN: I was just going to say,

10

because if they have that power, then they obviously

11

have the power to regulate everything, because

12

everything in the aggregate is statistically connected

13

to something that negatively affects commerce, and every

14

compelled purchase promotes commerce.

15

JUSTICE BREYER: So in your view, right

16

there -- in your view right there -17

MR. CARVIN: Justice Breyer -18

JUSTICE BREYER: Can I just -19

MR. CARVIN: I'm sorry.

20

JUSTICE BREYER: I'm just picking on

21

something. I'd like to just -- if it turned out there

22

was some terrible epidemic sweeping the United States,

23

and we couldn't say that more than 40 or 50 percent -- I

24

can make the number as high as I want -- but the -- the

25

-- you'd say the Federal Government doesn't have the

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power to get people inoculated, to require them to be

2

inoculated, because that's just statistical.

3

MR. CARVIN: Well, in all candor, I think

4

Morrison must have decided that issue, right? Because

5

people who commit violence against -6

JUSTICE BREYER: Is your answer to that yes

7

or no?

8

MR. CARVIN: Oh, I'm sorry. My answer is

9

no, they couldn't do it, because Morrison -10

JUSTICE BREYER: No, they could not do it?

11

MR. CARVIN: Yes.

12

JUSTICE BREYER: They cannot require people,

13

even if this disease is sweeping the country, to be

14

inoculated. The Federal Government has no power, and if

15

there's -- okay, fine. Go ahead.

16

MR. CARVIN: May -17

JUSTICE BREYER: Please turn to Justice

18

Kagan.

19

MR. CARVIN: May I just please explain why?

20

JUSTICE BREYER: Yes.

21

MR. CARVIN: Violence against women

22

obviously creates the same negative impression on fellow

23

citizens as this communicable disease, but the --

and

24

it has huge effects on the health care of our country.

25

Congress found that it increased health care costs by -86

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JUSTICE BREYER: I agree with you that -2

MR. CARVIN: Well, but -3

JUSTICE BREYER: -- that it had big effects,

4

but the majority thought that was a local matter.

5

JUSTICE SCALIA: I think that's his point.

6

(Laughter.)

7

MR. CARVIN: I -- I don't know why having a

8

disease is any more local than -- that beating up a

9

woman. But -- but -- my basic point is, is that

10

notwithstanding its very profound effect on the health

11

care market, this Court said the activity being

12

regulated, i.e., violence against women, is outside the

13

Commerce Clause power. So regardless of whether it has

14

beneficial downstream effects, we must say no, Congress

15

doesn't have that power. Why not? Because everything

16

has downstream effects on commerce and every compelled

17

purchase promotes commerce. It by definition helps the

18

sellers of existing -19

JUSTICE ALITO: Mr. Carvin, isn't there this

20

difference between Justice Breyer's hypothetical and the

21

law that we have before us here? In his hypothetical

22

the harm to other people from the communicable disease

23

is the result of the disease. It is not the result of

24

something that the government has done, whereas here the

25

reason why there is cost- shifting is because the

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government has mandated that. It has required hospitals

2

to provide emergency treatment and, instead of paying

3

for that through a tax which would be born by everybody,

4

it has required -- it has set up a system in which the

5

cost is surreptitiously shifted to people who have

6

health insurance and who pay their bills when they go to

7

the hospital.

8

MR. CLEMENT: Justice Alito, that is exactly

9

the government's argument. It's an extraordinarily

10

illogical argument.

11

JUSTICE BREYER: Fine. Then if that's so,

12

is -- let me just change my example under pressure -13

(Laughter.)

14

JUSTICE BREYER: -- and say that in fact it

15

turns out that 90 percent of all automobiles driving

16

interstate without certain equipment put up pollution,

17

which travels interstate -- not 100 percent, maybe only

18

60 percent. Does the EPA have the power then to say

19

you've got to have an antipollution device? It's

20

statistical.

21

MR. CARVIN: What they can't do -- yes, if

22

you have a car, they can require you to have an

23

anti-pollution -24

JUSTICE BREYER: Then you're not going on

25

statistics; you're going on something else, which is

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what I'd like to know what it is.

2

MR. CARVIN: It's this. They can't require

3

you to buy a car with an anti-pollution device. Once

4

you've entered the market and made a decision, they can

5

regulate the terms and conditions of the car that you

6

do, and they can do it for all sorts of reasons. What

7

they can't do it compel you to enter the market.

8

JUSTICE BREYER: Now we -- now you've

9

changed the ground of argument, which I accept as -- as

10

totally legitimate. And then the question is when you

11

are born and you don't have insurance and you will in

12

fact get sick and you will in fact impose costs, have

13

you perhaps involuntarily -- perhaps simply because you

14

are a human being -- entered this particular market,

15

which is a market for health care?

16

MR. CARVIN: If being born is entering the

17

market, then I can't think of a more plenary power

18

Congress can have, because that literally means they can

19

regulate every human activity from cradle to grave. I

20

thought that's what distinguished the plenary police

21

power from the very limited commerce power.

22

I don't disagree that giving the Congress

23

plenary power to mandate property transfers from A to B

24

would be a very efficient way of helping B and of

25

accomplishing Congress's objectives. But the framers -89

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JUSTICE BREYER: I see the point. You can

2

go back to, go back to Justice Kagan. Don't forget her

3

question.

4

JUSTICE KAGAN: I've forgotten my question.

5

(Laughter.)

6

MR. CARVIN: I -- I was facing the same

7

dilemma, Justice Kagan.

8

JUSTICE GINSBURG: Let me -- let me ask a

9

question I asked Mr. Clement. It just seems -10

JUSTICE KAGAN: See what it means to be the

11

junior justice?

12

(Laughter.)

13

JUSTICE GINSBURG: It just seems very

14

strange to me that there's no question we can have a

15

Social Security system besides all the people who say:

16

I'm being forced to pay for something I don't want. And

17

this it seems to me, to try to get care for the ones who

18

need it by having everyone in the pool, but is also

19

trying to preserve a role for the private sector, for

20

the private insurers. There's something very odd about

21

that, that the government can take over the whole thing

22

and we all say, oh, yes, that's fine, but if the

23

government wants to get -- to preserve private insurers,

24

it can't do that.

25

MR. CARVIN: Well I don't think the test of

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a law's constitutionality is whether it more adheres to

2

the libertarian principles of the Cato Institute or the

3

statist principles of someone else. I think the test of

4

a law's constitutionality is not those policy questions;

5

it's whether or not the law is regulating things that

6

negatively affect commerce or don't.

7

And since obviously the failure to purchase

8

an item doesn't create the kind of effects on supply and

9

demand that the market participants in Wickard and Raich

10

did and doesn't in any way interfere with regulation of

11

the insurance companies, I don't think it can pass the

12

basic -13

JUSTICE GINSBURG: I thought -- I thought

14

that Wickard was you must buy; we are not going to let

15

you use the home-grown wheat. You have got to go out in

16

the market and buy that wheat that you don't want.

17

MR. CARVIN: Oh, but let's be careful about

18

what they were regulating in Wickard, Justice Ginsburg.

19

What they were regulating was the supply of wheat. It

20

didn't in any way imply that they could require every

21

American to go out and buy wheat. And yes, one of the

22

consequences of regulating local market participants is

23

it'll affect the supply and the demand for the product.

24

That's why you can regulate them, because those local

25

market participants have the same effect on the

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interstate market that a black market has on a legal

2

market.

3

But none of that is true -- in other words,

4

you can regulate local bootleggers, but that doesn't

5

suggest you can regulate teetotalers, people who stay

6

out of the liquor market, because they don't have any

7

negative effect on the existing market participants or

8

on regulation of those market participants.

9

JUSTICE KAGAN: That's why I suggested, Mr.

10

Carvin, that it might be different if you were raising

11

an as-applied challenge and presenting a class of people

12

whom you could say clearly would not be in the health

13

care market. But you're raising a facial challenge and

14

we can't really know which, which of the many, many,

15

people that this law addresses in fact will not

16

participate in the health care market and in fact will

17

not impose costs on all the rest of us.

18

So the question is can Congress respond to

19

those facts, that we have no crystal ball, that we can't

20

tell who is and isn't going to be in the health

21

insurance market, and say most of these people will be

22

and most of these people will thereby impose costs on

23

the rest of us and that's a problem that we can deal

24

with on a class-wide basis?

25

MR. CARVIN: No again. The people who

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impose the costs on the rest of us are people who engage

2

in a different activity at a different time, which is

3

defaulting on their health care payments. It's not the

4

uninsured. Under your theory you could regulate anybody

5

if they have got a statistical connection to a problem.

6

You could say, since we could regulate people who enter

7

into the mortgage market and impose mortgage insurance

8

on them, we can simply impose the requirement to buy

9

private mortgage insurance on everybody before they have

10

entered the market because we are doing it in this

11

prophylactic way before it develops.

12

CHIEF JUSTICE ROBERTS: No, no, that's not

13

-- I don't think that's fair, because not everybody is

14

going to enter the mortgage market. The government's

15

position is that almost everybody is going to enter the

16

health care market.

17

MR. CARVIN: Two points, one of which

18

Mr. Clement's already made, which is the health

19

insurance market is different than the health care

20

market. But let me take it on full-stride. I think

21

everybody is in the milk market. I think everybody is

22

in the wheat product market. But that doesn't suggest

23

that the government compel you to buy five gallons of

24

meat or five bushels of wheat because they are not

25

regulating commerce.

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Whether you're a market participant or not,

2

they are still requiring you to make a purchase that you

3

don't want to do, and to get back to your facial

4

example -5

JUSTICE SOTOMAYOR: I mean, but that's true

6

of almost every product.

7

MR. CARVIN: I've sorry?

8

JUSTICE SOTOMAYOR: It's true of almost

9

every product, directly or indirectly by government

10

regulation. The government says, borrowing my

11

colleague's example, you can't buy a car without

12

emission control. I don't want a car with emission

13

control. It's less efficient in terms of the

14

horsepower. But I'm forced to do something I don't want

15

to do by government regulation.

16

MR. CARVIN: You are not forced to buy a

17

product you don't want. And I agree with you that since

18

the government regulates all markets there is no

19

limiting principle on their compelled purchase. When

20

they put these environmental controls on the -21

JUSTICE SOTOMAYOR: They force me to buy -22

MR. CARVIN: I'm sorry.

23

JUSTICE SOTOMAYOR: They forced me to buy if

24

I need unpasteurized foods, goods that don't have

25

certain pesticides but have others. There is government

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compulsion in almost every economic decision because the

2

government regulates so much. It's a condition of life

3

that some may rail against, but -4

MR. CARVIN: Let's think about it this way.

5

Yes, when you've entered the marketplace they can impose

6

all sorts of restrictions on you, and they can impose,

7

for example, all kinds of restrictions on States after

8

they have enacted laws. They can wipe out the laws.

9

They can condition them.

10

But what can't they do? They can't compel

11

States to enact laws. They can't compel States to carry

12

out Federal law. And I am arguing for precisely the

13

same distinction, because everyone intuitively

14

understands that regulating participants after A and B

15

have entered into a contract is fundamentally less

16

intrusive than requiring the contract.

17

JUSTICE SOTOMAYOR: We let the government

18

regulate the manufacturing process whether or not the

19

goods will enter into interstate commerce, merely

20

because they might statistically. We -- there is all

21

sorts of government regulation of manufacturing plants,

22

of agricultural farms, of all sorts of activity that

23

will be purely intrastate because it might affect

24

interstate activity.

25

MR. CARVIN: I fully agree with you, Justice

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Sotomayor. But I think -2

JUSTICE SOTOMAYOR: So how is that different

3

from saying you are self-insuring today, you're

4

foregoing insurance? Why isn't that a predecessor to

5

the need that you're eventually going to have?

6

MR. CARVIN: The cases you referred to I

7

think effectively eliminated the distinction between

8

participants in the intrastate market vis-à-vis

9

participants in the interstate market. None of those

10

cases suggest that you can regulate people who are

11

outside of the market on both an intrastate and

12

interstate level by compelling them to enter into the

13

market. And that -14

JUSTICE BREYER: What about -- the simplest

15

counter-example for me to suggest is you've undoubtedly

16

read Judge Sutton's concurring opinion. He has about

17

two pages, it seemed to me, of examples where everyone

18

accepts the facts that under these kinds of regulations

19

the government can compel people to buy things they

20

don't otherwise want to buy.

21

For example, he gives, even in that farm

22

case, the farmer who was being forced to go out and buy

23

grain to feed to his animals because he couldn't raise

24

it at home. You know and he goes through one example

25

after another. So what -- what is your response to

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that, which you've read?

2

MR. CARVIN: Judge Sutton is wrong in each

3

and every example. There was no -- there was no

4

compulsion in Raich for him to buy wheat. He could have

5

gotten wheat substitutes or he could have not sold

6

wheat, which is actually what he was doing. There is a

7

huge difference between conditioning regulation, i.e.,

8

conditioning access to the health care market and saying

9

you must buy a product, and forcing you to buy a

10

product. And that, that -- I'm sorry.

11

JUSTICE GINSBURG: I thought it was common

12

ground that the requirement that the insurers -- what

13

was it, the community-based one and they have to insure

14

you despite your health status; they can't refuse

15

because of preexisting conditions. The government tells

16

us and the Congress determined that those two won't work

17

unless you have a pool that will include the people who

18

are now healthy. But so -- well, first, do you agree

19

with your colleague that the community-based -- and

20

what's the name that they give to the other?

21

MR. CARVIN: The guaranteed-issue.

22

JUSTICE GINSBURG: Yes. That that is

23

legitimate Commerce Clause legislation?

24

MR. CARVIN: Oh, sure. And that's why -25

but we don't in any way impede that sort of regulation.

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These nondiscrimination regulations will apply to every

2

insurance company just as Congress intended whether or

3

not we buy insurance.

4

JUSTICE GINSBURG: Well then, what about the

5

determination that they can't possibly work if people

6

don't have to buy insurance until they are -- their

7

health status is such that the insurance company just

8

dealt with them on its -- as it will? They'd say, I

9

won't insure you because you're -- you're already sick.

10

MR. CARVIN: It depends what you mean by

11

"work." It'll work just fine in ensuring that no sick

12

people are discriminated against. What -- what -- but

13

when you do that -- Congress -14

JUSTICE GINSBURG: But the sick people, why

15

would they insure early if they had to be protected if

16

they get insurance late?

17

MR. CARVIN: Yes. Well, that's -- see, this

18

is the government's very illogical argument. They seem

19

to be saying, look, we couldn't just force people to buy

20

insurance to lower health insurance premiums. That

21

would be no good. But we can do it because we've

22

created the problem. We, Congress, have driven up the

23

health insurance premiums, and since we've created that

24

problem, this somehow gives us authority that we

25

wouldn't otherwise have. That can't possibly be right.

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That would -2

JUSTICE SOTOMAYOR: Do you think that

3

there's -- what percentage of the American people who

4

took their son or daughter to an emergency room and that

5

child was turned away because the parent didn't have

6

insurance -- do you think there's a large percentage of

7

the American population who would stand for the death of

8

that child -9

MR. CARVIN: One of the most -10

JUSTICE SOTOMAYOR: -- if they had an

11

allergic reaction and a simple shot would have saved the

12

child?

13

MR. CARVIN: One of the more pernicious,

14

misleading impressions that the government has made is

15

that we are somehow advocating that people could get

16

thrown out of emergency rooms, or that this alternative

17

that they've hypothesized is going to be enforced by

18

throwing people out of emergency rooms. This

19

alternative, i.e., you condition access to health care

20

on buying health insurance, is enforced in precisely the

21

same way that the Act does. You either buy health

22

insurance or you pay a penalty of $695. You don't have

23

doctors throwing people out on the street. And -- and

24

so the only -25

JUSTICE SOTOMAYOR: I'm sorry. Did you say

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the penalty's okay but not the mandate? I'm sorry.

2

Maybe I've misheard you.

3

MR. CARVIN: No, no, no. I was -- they

4

create this strawman that says: Look, the only

5

alternative to doing it the way we've done it, if we

6

condition access to health care on buying health

7

insurance, the only way you can enforce that is making

8

sick people not get care. I'm saying no, no. There's a

9

perfectly legitimate way they could enforce their

10

alternative, i.e., requiring you to buy health insurance

11

when you access health care, which is the same penalty

12

structure that's in the Act.

13

There is no moral dilemma between having

14

people have insurance and denying them emergency

15

service. Congress has made a perfectly legitimate value

16

judgment that they want to make sure that people get

17

emergency care. Since the founding, whenever Congress

18

has imposed that public responsibility on private

19

actors, it has subsidized it from the Federal Treasury.

20

It has not conscripted a subset of the citizenry and

21

made them subsidize the actors who are being hurt, which

22

is what they're doing here.

23

They're making young, healthy people

24

subsidize insurance premiums for the cost that the

25

nondiscrimination provisions have put on insurance

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premiums and insurance companies.

2

JUSTICE SOTOMAYOR: So the -3

MR. CARVIN: And that is the fundamental

4

problem here.

5

JUSTICE SOTOMAYOR: So the -- I -- I want to

6

understand the choices you're saying Congress has.

7

Congress can tax everybody and set up a public health

8

care system.

9

MR. CARVIN: Yes.

10

JUSTICE SOTOMAYOR: That would be okay?

11

MR. CARVIN: Yes. Tax power is -12

JUSTICE SOTOMAYOR: Okay.

13

MR. CARVIN: I would accept that.

14

JUSTICE SOTOMAYOR: Congress can -- are you

15

taking the same position as your colleague, Congress

16

can't say we're going to set up a public health system,

17

but you can get a tax credit if you have private health

18

insurance because you won't access the public system.

19

Are you taking the same position as your colleague?

20

MR. CARVIN: There may have been some

21

confusion in your prior colloquy. I fully agree with my

22

brother Clement that a direct tax would be

23

unconstitutional. I don't think he means to suggest,

24

nor do I, that a tax credit that incentivizes you to buy

25

insurance creates a problem. Congress incentivizes all

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kinds of activities. If they gave us a tax credit for

2

buying insurance, then it would be our choice whether or

3

not that makes economic sense, even though -4

JUSTICE SOTOMAYOR: So how is this different

5

than this Act, which says if a taxpayer fails to meet

6

the requirement of having minimum coverage, then they

7

are responsible for paying the shared responsibility

8

payment?

9

MR. CARVIN: The difference is that the

10

taxpayer is not given a choice. It's the difference

11

between banning cigarettes and saying I'm going to

12

enforce that legal ban through a $5 a pack penalty, and

13

saying, look, if you want to sell cigarettes, fine; I'm

14

going to charge you a tax of $5 a pack. And that's -15

JUSTICE SOTOMAYOR: I think -- I think

16

that's what's happening, isn't it?

17

MR. CARVIN: No. Not -18

JUSTICE SOTOMAYOR: We're paying -- I

19

thought that everybody was paying, what is it, $10 a

20

pack now? I don't even know the price. It's pretty

21

high.

22

MR. CARVIN: Right. And everyone would -23

JUSTICE SOTOMAYOR: I think everybody

24

recognizes that it's all taxation for the purposes of

25

dissuading you to buy it.

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MR. CARVIN: That's precisely my point. And

2

everyone intuitively understands that that system is

3

dramatically different than saying cigarettes tomorrow

4

are illegal.

5

JUSTICE BREYER: It is different. It is

6

different. It is different. I agree with that. But

7

you pointed out, and I agree with you on this, that the

8

government set up these emergency room laws. The

9

government set up Medicaid. The government set up

10

Medicare. The government set up CHIP, and there are 40

11

million people who don't have the private insurance.

12

In that world, the government has set up

13

commerce. It's all over the United States. And in that

14

world, of course, the decision by the 40 million not to

15

buy the insurance affects that commerce and

16

substantially so.

17

So I thought the issue here is not whether

18

it's a violation of some basic right or something to

19

make people buy things they don't want, but simply

20

whether those decisions of that group of 40 million

21

people substantially affect the interstate commerce that

22

has been set up in part through these other programs.

23

So that's the part of your argument I'm not

24

hearing.

25

MR. CARVIN: Let me -103

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JUSTICE BREYER: Please.

2

MR. CARVIN: It is clear that the failure to

3

buy health insurance doesn't affect anyone. Defaulting

4

on your payments to your health care provider does.

5

Congress chose, for whatever reason, not to regulate the

6

harmful activity of defaulting on your health care

7

provider. They used the 20 percent or whoever among the

8

uninsured as a leverage to regulate the 100 percent of

9

the uninsured.

10

JUSTICE KENNEDY: I agree -- I agree that

11

that's what's happening here.

12

MR. CARVIN: Okay.

13

JUSTICE KENNEDY: And the government tells

14

us that's because the insurance market is unique. And

15

in the next case, it'll say the next market is unique.

16

But I think it is true that if most questions in life

17

are matters of degree, in the insurance and health care

18

world, both markets -- stipulate two markets -- the

19

young person who is uninsured is uniquely proximately

20

very close to affecting the rates of insurance and the

21

costs of providing medical care in a way that is not

22

true in other industries.

23

That's my concern in the case.

24

MR. CARVIN: And, Your -- I may be

25

misunderstanding you, Justice Kennedy. I hope I'm not.

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Sure, it would be perfectly fine if they

2

allowed -- you do actuarial risk for young people on the

3

basis of their risk for disease, just like you judge

4

flood insurance on the homeowner's risk of flood. One

5

of the issues here is not only that they're compelling

6

us to enter into the marketplace, they're not -- they're

7

prohibiting us from buying the only economically

8

sensible product that we would want, catastrophic

9

insurance.

10

Everyone agrees the only potential problem

11

that a 30-year-old, as he goes from the healthy 70

12

percent of the population to the unhealthy 5 percent -13

and yet Congress prohibits anyone over 30 from buying

14

any kind of catastrophic health insurance. And the

15

reason they do that is because they needed this massive

16

subsidy.

17

Justice Alito, it's not our numbers. CBO

18

said that injecting my clients into the risk pool lowers

19

premiums by 15 to 20 percent.

20

So, Justice Kennedy, even if we were going

21

to create exceptions for people that are outside of

22

commerce and inside of commerce, surely we'd make

23

Congress do a closer nexus and say, look, we're really

24

addressing this problem; We want these 30-year-olds to

25

get catastrophic health insurance.

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And not only did they -- they deprived them

2

of that option. And I think that illustrates the

3

dangers of giving Congress these plenary powers, because

4

they can always leverage them. They can always come up

5

with some public policy rationale that converts the

6

power to regulate commerce into the power to promote

7

commerce, which, as I was saying before, is the one that

8

I think is plenary.

9

JUSTICE KAGAN: Mr. Carvin, a large part of

10

this argument has concerned the question of whether

11

certain kinds of people are active participants in a

12

market or not active participants in a market. And your

13

test, which is a test that focuses on this

14

activity/inactivity distinction, would force one to

15

confront that problem all the time.

16

Now, if you look over the history of the

17

Commerce Clause, what you see is that there were sort of

18

unhappy periods when the Court used tests like this,

19

direct versus indirect, commerce versus manufacturing.

20

I think most people would say that those things didn't

21

really work. And the question is, why should this test,

22

inactive versus active, work any better?

23

MR. CARVIN: The problem you identify is

24

exactly the problem you would create if you bought the

25

government's bogus limiting principles. You'd have to

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draw a distinction between the insurance industry and

2

the car industry and all of that, returning to the

3

Commerce Clause jurisprudence that bedeviled the Court

4

before the 1930s, where they were drawing all these

5

kinds of distinctions among industries, whereas our test

6

is really very simple. Are you buying the product or is

7

Congress compelling you to buy the product? I can't

8

think of a brighter line.

9

And again, if Congress has the power to

10

compel you to buy this product, then obviously they have

11

got the power to provide you -- to compel you to buy any

12

product, because any purchase is going to benefit

13

commerce, and this Court is never going to second-guess

14

Congress's policy judgments on how important it is this

15

product versus that product.

16

JUSTICE ALITO: Do you think that drawing a

17

line between commerce and everything else that is not

18

commerce is drawing an artificial line, like drawing a

19

line between commerce and manufacturing?

20

MR. CARVIN: The words "inactivity" and

21

"activity" are not in the Constitution. The words

22

"commerce" and "noncommerce" are. And again, it's a

23

distinction that comes, Justice Kagan, directly from the

24

text of the Constitution.

25

The Framers consciously gave Congress the

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ability to regulate commerce, because that's not a

2

particularly threatening activity that deprives you of

3

individual freedom.

4

If you were required, if you were authorized

5

to require A to transfer property to B, you have, as the

6

early cases put it, a monster in legislation which is

7

against all reason and justice, because everyone

8

intuitively understands that regulating people who

9

voluntarily enter into contracts in setting changing

10

conditions does not create the possibility of Congress

11

compelling wealth transfers among the citizenry. And

12

that is precisely why the Framers denied them the power

13

to compel commerce and precisely why they didn't give

14

them plenary power.

15

CHIEF JUSTICE ROBERTS: Thank you,

16

Mr. Carvin.

17

General Verrilli, you have 4 minutes

18

remaining.

19

REBUTTAL ARGUMENT OF DONALD B. VERRILLI, JR.,

20

ON BEHALF OF THE PETITIONERS

21

GENERAL VERRILLI: Thank you, Mr. Chief

22

Justice:

23

Congress confronted a grave problem when it

24

enacted the Affordable Care Act: The 40 million

25

Americans who can't get health insurance and suffered

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often very terrible consequences. Now, we agree, I

2

think, everyone arguing this case agrees, that Congress

3

could remedy that problem by imposing an insurance

4

requirement at the point of sale.

5

That won't work. The reason it won't work

6

is because people will still show up at the hospital or

7

at their physician's office seeking care without

8

insurance, causing the cost-shifting problem. And

9

Mr. Clement's suggestion that they can be signed up for

10

a high risk pool at that point is utterly unrealistic.

11

Think about how much it would cost to get

12

the insurance when you are at the hospital or at the

13

doctor. It would be -- it would be unfathomably high.

14

That will never work. Congress understood that. It

15

chose the means that will work, the means that it saw

16

worked in the States and in the State of Massachusetts,

17

and that -- and that it had every reason to think would

18

work on a national basis.

19

That is the kind of choice of means that

20

McCulloch says that the Constitution leaves to the

21

democratically accountable branches of government.

22

There is no temporal limitation in the Commerce Clause.

23

Everyone subject to this regulation is in or will be in

24

the health care market. They are just being regulated

25

in advance. That's exactly the kind of thing that ought

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to be left to the judgment of Congress and the

2

democratically accountable branches of government.

3

And I think this is actually a paradigm

4

example of the kind of situation that Chief Justice

5

Marshall envisioned in McCulloch itself, that the

6

provisions of the Constitution needed to be interpreted

7

in a manner that would allow them to be effective in

8

addressing the great crises of human affairs that the

9

Framers could not even envision.

10

But if there is any doubt about that under

11

the Commerce Clause, then I urge this Court to uphold

12

the minimum coverage provision as an exercise of the

13

taxing power.

14

Under New York v. United States, this is

15

precisely a parallel situation. If the Court thinks

16

there is any doubt about the ability of Congress to

17

impose the requirement in 5000A(a), it can be treated as

18

simply the predicate to which the tax incentive of

19

5000A(b) seeks accomplishment.

20

And the Court, as the Court said in New

21

York, has a solemn obligation to respect the judgments

22

of the democratically accountable branches of

23

government, and because this statute can be construed in

24

a manner that allows it to be upheld in that way, I

25

respectfully submit that it is this Court's duty to do

110

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so.

2

CHIEF JUSTICE ROBERTS: Thank you, General.

3

Counsel, we'll see you tomorrow.

4

(Whereupon, at 12:02 p.m., the case in the

5

above-entitled matter was submitted.)

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

111

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112

A

77:14

addresses 3:11

26:12 30:19

29:19

ability 20:14,25

act 3:11 4:14,16

27:11 92:15

42:5 43:9 77:18 America 64:15

42:10 60:15

10:12 11:22

addressing 4:13

77:21 81:21

American 91:21

108:1 110:16

24:19 26:1,3,5

9:16 26:15

87:1 94:17

99:3,7

able 6:18 22:21

31:4,13 34:4

47:19 82:23

95:25 97:18

Americans 3:17

59:21 69:18

61:18 81:18

105:24 110:8

101:21 103:6,7

3:17,20 108:25

77:25 84:10

99:21 100:12

adheres 91:1

104:10,10

amount 25:13

above-entitled

102:5 108:24

administered

109:1

33:23 34:18

1:12 111:5

acting 82:14

46:16

agreed24:14,17

59:8,10

absence 11:9

action 19:20

administrative

60:22

analogy 52:17

absent 31:8 68:3

62:11

51:20

agrees 22:22

analysis 17:7

69:19

actions 49:13

admit 71:10

105:10 109:2

25:7 27:9 30:8

absolutely 8:8

80:1

adopted38:25

agricultural

animals 96:23

19:19 78:25

active 106:11,12 adult 56:23

82:10 95:22

annuity 58:16

82:12

106:22

advance 12:12

ah 62:2

answer15:13,18

accept 39:22

activities 102:1

44:21 71:19

ahead 22:11

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activity 5:7 14:9

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advancing 16:17 al 1:4,7,20,22 2:7

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80:19 86:6,8

accepted40:24

29:1 30:4,25

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answering 23:8

accepts 96:18

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45:6 99:15

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41:5

access 3:18,21

84:20,23,24

affairs 76:9

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answers 15:9

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87:11 89:19

110:8

33:21 34:12,24 antipollution

70:1 97:8 99:19

93:2 95:22,24

affect 19:18,18

43:18,20 44:2,4

88:19

100:6,11

104:6 107:21

41:23 48:11

52:9 87:19 88:8 anti-pollution

101:18

108:2

67:1 72:6 76:22

105:17 107:16

88:23 89:3

accident 67:10

activity/inactiv...

85:2,4 91:6,23

Alito's 57:8

anybody 59:19

67:12,15

106:14

95:23 103:21

allergic 99:11

73:13 93:4

accomplish

actor 69:20

104:3

allocation 56:24

anyway 20:15

57:21

actors 100:19,21 affirmative

allow20:16

25:12,12

accomplishing

actual 72:23

11:22 31:4

43:17 110:7

apparatus 51:20

50:16 89:25

actuarial 34:8

62:11 78:7

allowed11:21

52:7

accomplishment

56:24 57:2,10

affirmatively

80:1 105:2

APPEARANC...

110:19

57:14 69:1,1

23:9

allows 14:5 65:25

1:15

accord 40:5

105:2

afford 11:5 19:14

110:24

appears 10:3

account 20:22

actuaries 68:12

22:5 45:2

alter81:13

appendix 75:24

34:13 70:16

adapted27:5,12

affordable 3:11

alternate 25:4

applies 21:5

accountable

27:14,16

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109:21 110:2

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apply 4:7 33:9

110:22

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98:1

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age 53:5 58:6

alternatives 24:1 apportioned

achieve 24:18,20

11:5

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51:11

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address 4:11,12

73:22,24,24

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apprehension

8:16 28:17

64:12 78:4 83:2

85:12

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73:7,8

acknowledges

addressed75:4

agree 12:22

Amendment

appropriate

Alderson Reporting Company

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Official - Subject to Final Review

113

32:21

assistance 6:3

ban 102:12

beyond 11:21

brief 14:20 17:18

April 46:17 50:18

6:22 7:3,4,4

bank 15:15 61:14

14:4 25:24 47:4

57:25 75:24

arbitrary 41:21

associate 70:25

61:25 63:16,19

51:11 80:4

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assume 11:19,20

63:24 64:1,2,6

big 9:2,5 52:24

briefs 21:11

43:3,4 67:4

25:4

banning 102:11

55:16 58:12

brighter107:8

80:14

assumption 55:9

bans 29:10

62:25 87:3

bring 20:1

areas 75:11

as-applied92:11 based4:6,20

bigger75:12

broad 39:14

argue 10:20

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66:11 77:24

bill 61:6 76:1

broadly 13:1

argued25:8

attributable

basement 62:10

84:10

broccoli 13:12

62:15

44:12

basic 18:15 80:9

billion 29:8

17:21,23 18:1,8

arguing 67:2

attributes 33:16

83:21 84:25

billions 9:17

18:11 76:4,20

83:8 95:12

authority 8:17

87:9 91:12

bills 14:21 36:18

brother101:22

109:2

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103:18

88:6

burden11:23

argument 1:13

42:9 43:14 44:9 basically 66:8

bit 60:9 65:17

12:3

2:2,5,8,11 3:4,7

44:10 56:8 82:3 basis 5:4 13:22

black 92:1

burial 7:14,15,23

6:25 8:20 10:22

98:24

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blah 52:25,25

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34:21 50:7

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22:6,14,14

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92:24 105:3

blind 31:7

15:24,24 72:7

23:15,16 25:14 authorized108:4

109:18

blue 13:25

burials 15:20

25:18 27:19

automobile

Baucus 49:16

bogus 106:25

buried8:25

29:22 39:6

18:12 64:19

bears 47:1

bootleggers 92:4 bus 34:11,14

40:24 41:3

automobiles

beating 87:8

born 88:3 89:11

83:12

42:21 54:1

88:15

bedeviled107:3

89:16

bushels 93:24

56:22 57:4 63:2 available 4:2,3

begets 4:8

borrowing 94:10

business 80:15

64:24 66:25

59:6

beginning 58:13

bothering 69:19

buy 6:9 13:9,11

67:6 71:5 72:25 average 10:4,9

63:13

bought 106:24

14:16 15:1,3,20

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averse 66:9,10

behalf 1:17,19

boundary 28:23

15:20 16:7

88:9,10 89:9

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30:24

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98:18 103:23

a.m 1:14 3:2

2:13 3:8 54:2

branches 109:21

22:11 29:23

106:10 108:19

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110:2,22

35:21 36:14,19

arguments 21:11

B

behavior 48:22

bread 64:16

36:22 48:9,12

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71:7 72:5 75:25

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35:1 107:12

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28:4

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85:15,17,18,20

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86:6,10,12,17

91:14,16,21

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bets 40:6 43:8

89:8 90:1 96:14

96:19,20,22

23:9 25:17 27:3 balance 53:18

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103:5 104:1

97:4,9,9 98:3,6

76:2 90:9

ball 92:19

58:14 68:12,12 Breyer's 78:4

98:19 99:21

asks 24:6 78:10

baloney 65:17

68:16 106:22

87:20

100:10 101:24

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102:25 103:15

26:14,25 29:7

86:21 87:2,7,19 causing 70:21,22

65:8 69:10

103:19 104:3

31:19 32:3,15

88:21 89:2,16

109:8

77:22 78:22

107:7,10,11

33:23 34:4 39:7

90:6,25 91:17

CBO 10:4

81:1,6 82:5,7

buying 19:24

39:12 40:9,16

92:10,25 93:17

105:17

82:12,22 83:3

20:2,11 55:3

41:10,24 42:13

94:7,16,22 95:4 cell 6:10 15:20

83:17 93:12

99:20 100:6

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16:4

108:15,21

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110:4 111:2

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100:3 101:3,9

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101:11,13,20

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68:6,8,15 69:15

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choice 14:16

calculate 34:17

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103:1,25 104:2

88:16 94:25

15:1 19:16

59:10

72:13,23,23

104:12,24

106:11

24:23 25:21

calculated33:23

74:13,14,17,20

106:9,23

certainly 50:25

102:2,10

52:4

75:2,4,9,18

107:20 108:16

55:19 70:18

109:19

calculation 37:9

81:12,16,17,23 case 3:4 5:5

certificate 65:21 choices 101:6

call 50:9

82:24 83:1,6,10

10:14 22:23

challenge 92:11

choose 24:25

called49:15

83:11 84:12,17

26:3 39:23

92:13

25:2

50:22

84:19 86:24,25

40:22,23 45:8

change 83:20

choosing 27:4

calling 50:15

87:11 89:15

45:13,18,21

88:12

chose 5:16 25:2

calls 35:11

90:17 92:13,16

46:25 49:9

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cancer84:11

93:3,16,19 97:8

52:17 61:3

changes 31:14

109:15

candor 86:3

99:19 100:6,8

63:14,18 64:9

changing 11:25

chosen23:17

capable 47:6

100:11,17

69:11 74:16

108:9

24:25 27:7

capture 56:15,18

101:8 104:4,6

76:4 78:6,10

characterization

29:17 40:15

captured57:16

104:17,21

79:21,22,23

36:10 46:11,15 Christian 69:17

car 16:7 17:21,23

108:24 109:7

96:22 104:15

49:13

cigarettes

19:24 20:3 31:7

109:24

104:23 109:2

characterized

102:11,13

64:22 66:12,13 careful 38:23

111:4

5:15 46:11

103:3

66:18 67:18,22

91:17

cases 11:21

charge 9:20

citizen31:13

70:20 71:9,20

caring 60:7

27:15 28:23

11:16 37:12

citizenry 63:25

74:7,8,9,21

carriage 60:23

30:21 31:14

102:14

100:20 108:11

88:22 89:3,5

carriages 60:19

47:4 64:8 96:6

cheaper72:22

citizens 86:23

94:11,12 107:2

60:25

96:10 108:6

Chief 3:3,9 5:25

City 71:8

care 3:11,12,14

carry 4:23 22:25

cash 64:20

6:13,20 7:8

class 21:5 33:1

3:16 4:15,15

95:11

catastrophe

17:17 18:4,6,9

34:24 44:22

5:7,14,15 6:6

cars 19:24,25

83:12

18:14,17 30:11

69:17 92:11

7:1 8:8,9,14,24

60:5 65:5 67:1

catastrophes

30:20 31:24

class-wide 92:24

9:20,22 12:7,19

67:6,19

83:14

32:12 33:7 39:6 clause 4:17

12:23,24 13:1,2 Carvin 1:21 2:9

catastrophic

39:10 40:11,14

15:11 16:20,21

14:21 17:14,22

81:3,4,6 82:6

55:11 75:4

41:1,17 42:4,14

16:23 18:25

18:8,22,22

82:12 83:2,19

105:8,14,25

42:18,23 43:13

20:21 27:9 38:9

20:13,15,17

84:6,15 85:6,7

Cato 91:2

50:8,11,20

39:13 44:10,18

22:2,7,22 23:20

85:9,17,19 86:3 cause 41:9

53:19,23 54:3

45:9,11 52:25

24:6,19 26:13

86:8,11,16,19

causes 41:9,10

55:12 64:5,23

54:7 61:10,10

Alderson Reporting Company

Official - Subject to Final Review

115

61:11 63:11

come 55:22

105:22,22

completely 8:11

33:14,15,18,20

73:11 77:6,7

62:12 72:16,17

106:6,7,17,19

comprehensive

36:2 38:2,6,15

79:16 87:13

106:4

107:3,13,17,18

26:20 44:7,8,19

38:22 39:11,25

97:23 106:17

comes 107:23

107:19,22

compulsion 95:1

40:3,5,15 42:6

107:3 109:22

commerce 4:17

108:1,13

97:4

42:9 43:4,9,17

110:11

4:25 5:8 8:18

109:22 110:11

computers 16:4

43:22 44:7,20

clear 47:13 58:1

11:22 12:10

commit 86:5

conceded54:19

45:15 47:12

61:17 104:2

14:10 15:10,11 commodities

concern 41:19

49:5,9,13,21

clearly 48:24

15:17 16:19,21

16:25

60:9,10 75:9

49:25 50:1,8

60:17,23,24

16:23 17:6,11

common 42:1

104:23

51:3 54:5,7,9

92:12

17:12,16 18:20

97:11

concerned42:24

54:12,19 56:4,7

Clement 1:19 2:6

18:23,24 19:1,5 commonly 48:18

75:1 106:10

56:14,18 57:21

53:21,25 54:1,3

20:21 23:10,21 communicable

concerning 31:3

58:4,19 61:12

54:22 55:6 56:2

23:24 26:9,10

86:23 87:22

concurrent 80:16

61:18 62:5,24

56:11 57:5 58:2

26:18,21 27:9

community 4:22

concurring 96:16

64:13 68:13,23

59:4,21 60:2,8

29:2 30:5 31:1

11:3,9,15 23:2

condition 29:11

69:5 70:7 71:24

63:12,16 64:23

35:5,7,21,22

37:1 39:1 57:17

37:21 95:2,9

73:11 74:1 76:8

65:8,17,23

38:9 39:13,17

57:18 59:10

99:19 100:6

76:13 77:6,13

66:19 67:5,16

39:18 40:4

community-ba... conditioning 97:7

81:14,19,25

68:7,20,22 69:9

41:20 43:7,15

97:13,19

97:8

82:1,1,10 83:8

69:21 70:3,17

43:24 44:18

community-rat... conditions 4:21

84:24 85:1

72:5 74:5,12,18

45:8 52:25 54:6

8:19 22:19

89:5 97:15

86:25 87:14

76:25 77:4,18

54:6,7,8,10,10

companies 9:22

108:10

89:18,22 92:18

77:21 78:5,24

54:14,25 55:1

10:12 11:4,11

conduct 48:11,12

97:16 98:2,13

80:12,18 81:2

61:9,10,13,15

11:14 37:17

51:18

98:22 100:15

88:8 90:9

61:18,23,24

55:5,21 56:25

conflicts 84:16

100:17 101:6,7

101:22

63:11,14,18,20

91:11 101:1

confront 106:15

101:14,15,25

Clement's 93:18

67:1,2 68:24

company 37:20

confronted

104:5 105:13

109:9

69:6 71:5 72:3

72:17 98:2,7

108:23

105:23 106:3

clients 105:18

73:2,5,10,11

company's 51:23 confronting 27:6

107:7,9,25

close 104:20

73:12,14,16,17 comparable

confusion 101:21

108:10,23

closer105:23

73:19,19 74:2

15:21

Congress 4:17

109:2,14 110:1

club 41:12,15

76:23 77:6,7,20 compel 40:21

5:16 7:10,11

110:16

clunkers 64:21

77:23 78:8,9,16

43:17 54:5,9

8:17 9:16,23

Congresses

code 45:16 46:16

79:1,5,7,9,10

69:6 73:14,17

12:10,22 14:9

74:25

46:20 48:19

80:15,17,21

79:9 81:9 89:7

15:11,15,25

congressional

50:17

81:11,16,19,20

93:23 95:10,11

16:11 17:5,5,11

75:22

colleague 97:19

81:21 82:1,2,15

96:19 107:10

17:12 19:21

Congress's

101:15,19

82:18,19,20,24

107:11 108:13

20:22 21:13

19:20 22:23

colleagues 23:9

85:2,2,5,13,14

compelled85:14

22:17 23:17

38:13,19 39:5

colleague's

87:13,16,17

87:16 94:19

24:1,7,14,17

39:13,20 41:20

94:11

89:21 91:6

compelling 77:23

24:22,24,25

42:8 43:1 55:1

collected50:17

93:25 95:19

96:12 105:5

25:2,4,12,19

69:8 75:23

52:2

97:23 103:13

107:7 108:11

27:4,5,7 28:25

89:25 107:14

colloquy 101:21

103:15,21

complete 77:13

29:4 30:3 32:20 conjunction

Alderson Reporting Company

Official - Subject to Final Review

116

23:22 45:7

17:22 41:16

37:2

75:5 102:6

danger31:6

conjure 63:19

55:4 61:21

counter-exam...

110:12

dangers 106:3

connected85:4

contagious 68:18

96:15

covered22:3

daughter99:4

85:12

contain 32:2

country 3:15,16

23:4 26:11 37:4 day 33:3,5 36:8

connection 84:24 context 36:4

29:6 35:6 86:13

37:5 55:13

51:25

93:5

70:19

86:24

covering 17:22

deal 17:15 22:19

consciously

continue 3:3

counts 25:23

18:1

24:3 82:9 92:23

107:25

contract 34:15

27:8

covers 37:14

dealing 24:9

conscripted

95:15,16

couple 7:21 24:1

75:5

dealt 98:8

100:20

contracts 35:17

76:7

cows 62:8

death 99:7

conscripting

108:9

course 16:1

cradle 89:19

debating 76:1

37:17

contrary 64:24

28:18 34:9 51:9 create 4:25

December49:14

conscription

contribute 58:11

63:21 68:20,22

15:11,15,16

decide 29:23

77:16

control 5:22 6:19

69:10 71:7

17:11 54:10

40:19 56:8 72:2

consequences

94:12,13

73:15 76:10

61:13,14 91:8

decided66:15

91:22 109:1

controls 94:20

103:14

100:4 105:21

72:15 83:24

consider24:7

controversial

Court 1:1,13

106:24 108:10

86:4

considered47:2

73:4

3:10 14:8 15:14 created61:14

decides 68:23

considering

converts 106:5

25:12 26:2,4,5

98:22,23

deciding 70:20

44:18

corporation

28:4,23 30:1,3

creates 75:18

decision 21:15

consistent 54:23

63:17

30:9,20 35:16

83:9 86:22

54:15 66:8 71:3

Constitution

correct 10:3 13:5

39:20 45:21,22

101:25

71:4,4 83:24

12:4 27:21 51:9

25:10

46:25 50:5

creating 61:25

89:4 95:1

77:15,16 81:13 cost 8:2 9:6,21

51:12,15 52:16

70:15 82:24

103:14

84:25 107:21

15:2 22:5 23:5

52:18 54:4

creation 18:23

decisions 74:2

107:24 109:20

33:25 34:1

63:21,22 69:4

18:25 38:19

75:22 78:18

110:6

70:24 71:23

76:8 77:5 79:1

39:5

103:20

constitutional

75:1,8,12,12

79:4 80:4 81:7

credit 60:6 66:2

deduction 48:23

11:25 27:18

76:22 87:25

87:11 106:18

66:3 101:17,24

48:24

28:9,13 46:12

88:5 100:24

107:3,13

102:1

deeply 20:22

49:15,22 58:19

109:11

110:11,15,20

credits 60:3,4

default 84:18

60:10

costs 9:18,25

110:20

cremated9:1

defaulting 93:3

constitutionality

14:22,24 34:17 Court's 30:21

crises 110:8

104:3,6

91:1,4

34:21 35:9

54:24 61:2

critical 31:25

defend 5:4 16:15

construe 50:5

41:10 45:3

110:25

criticisms 31:9

16:15

construed

75:10 86:25

cover9:21 11:5

crystal 92:19

defended49:17

110:23

89:12 92:17,22

11:12,17 32:19 cut 68:5

50:12

consume 10:17

93:1 104:21

33:25 37:13,18 cuts 25:4

defending 16:12

21:9 22:10

cost-free 84:12

coverage 4:23

cutting 65:17

deference 24:22

33:24 34:1

cost-shifting

5:17 8:20 11:10

40:5

54:20

109:8

12:8 22:24 23:2

D

define 13:1,8,10

consumed44:22

Counsel 111:3

23:18 24:18

D 1:19 2:6 3:1

31:25 32:10

consumes 10:9

counteract 38:15

26:23 32:11,21

54:1

33:16

consuming 21:6

44:12

33:13,17 39:1

dairy 26:6,7

definitely 15:5

consumption

counterproduc...

53:11 55:11

35:15,16

definition 87:17

Alderson Reporting Company

Official - Subject to Final Review

117

definitive 34:11

die 7:24 62:19

disavowed50:2

100:5,22

5:7 9:16 14:9

degree 104:17

difference 7:8

disconnect 74:24 dollar 4:2

17:12 19:21

deliberation

8:12,22 9:3,4,5 discourage 48:22 dollars 9:17,24

23:19 28:25

38:23

9:14,15 15:5,8

discover62:16

14:23 64:22

30:4,25 33:15

delighted78:24

15:8 17:9 18:6

discriminated

74:1

33:19,19 38:7

demand 16:25

18:20 24:12,24

98:12

DONALD 1:16

38:11,14 44:13

91:9,23

33:5 46:6 49:6

discrimination

2:3,12 3:7

54:15 69:20

demanded74:9

63:10 64:4

4:6,20 29:11

108:19

70:11 71:3,4

democratically

67:22 72:12

discussed52:13

door 77:23

72:9 75:22

109:21 110:2

74:16 80:23

discussion 52:24 doubled37:3

78:18 95:1

110:22

87:20 97:7

55:8 61:6

doubt 26:9 41:8

102:3

denied108:12

102:9,10

disease 34:15

52:15 60:22

economically

denominated

different 6:14

62:17 68:18

79:16 110:10

105:7

45:14,22 79:13

8:11 9:11 13:14

71:24 86:13,23

110:16

economies 72:20

79:23

13:14 21:22

87:8,22,23

downstream

74:9

denying 33:21

26:17 27:7

105:3

87:14,16

economists 10:7

100:14

30:15 31:13

disguised60:11

downtown 7:20

economy 3:13

Department 1:3

40:20 44:6 62:3 disproportionate dramatically

effect 11:3 14:10

1:17 3:4 52:1

63:22 65:5 66:3

51:18

103:3

21:14,15,15

departure 30:2

66:22 67:6,17

dissuading

draw82:13 107:1

29:1 30:4,25

depend 16:8 60:8

69:16 71:20,21

102:25

drawing 107:4,16

43:24 64:17

depends 69:22

74:11,12,25

distinction 18:5

107:18,18

71:5 73:20

98:10

82:17 84:19,20

62:12 82:13

Drexel 51:13,22

78:18,19 87:10

deposits 64:6

92:10 93:2,2,19

95:13 96:7

drive 62:5

91:25 92:7

deprived106:1

96:2 102:4

106:14 107:1

driven98:22

effective 3:18

deprives 108:2

103:3,5,6,6

107:23

driving 16:5

26:23 50:16,21

derived76:13

dilemma 90:7

distinctions

88:15

110:7

description

100:13

107:5

drug 72:17,24

effectively 96:7

78:14

direct 51:11

distinguish13:25 due 30:7,10

effects 5:8 9:16

designed24:19

60:11,15,17,19 distinguished

61:10 66:24

17:15 23:21

48:11,14 70:1,4

60:21,23 61:2

89:20

74:6 78:13

56:13 61:17,22

despite 97:14

64:16 67:21

distinguishes

dutifully 67:13

72:9 81:23

determination

78:19 79:15,18

15:5 70:19

duty 11:22 31:5,8

86:24 87:3,14

98:5

101:22 106:19

distinguishing

31:12 110:25

87:16 91:8

determined49:4

directed4:19

5:21 13:23

D.C 1:9,17,19,21 efficiency 25:20

97:16

direction 47:4

diversify 66:1

efficient 64:15

determinedly

directly 4:11,13

divided60:19

E

69:7 70:12

49:9

4:14 9:18,19

doctor 74:15

E 2:1 3:1,1

89:24 94:13

Detroit 70:21

94:9 107:23

83:9 109:13

earlier25:17

effort 54:5 64:12

develops 93:11

disabled58:10

doctors 99:23

52:24 55:12

efforts 49:4

device 48:5

disadvantageo... doing 7:22 8:4,8

56:10 57:9

either3:21 5:20

88:19 89:3

35:17

10:2,15 14:3

early 98:15

17:24 21:5

diagnosed34:15 disagree 11:19

21:23 25:8

108:6

44:23 72:8

diagnosis 34:11

89:22

33:20 57:2

echoed21:12

99:21

dial 6:11

disaster14:18

93:10 97:6

economic 4:8,8

elected76:14

Alderson Reporting Company

Official - Subject to Final Review

118

electric 74:7,8,9

29:10 30:22

estimate 10:8

exception 22:4

explicitly 50:1

eliminate 76:19

ensuring 98:11

estimated10:4

exceptions

exports 51:10

eliminated96:7

enter5:23,23

et 1:4,7,20,22 2:7

105:21

express 43:21

eliminates 76:20

6:17,18,19

2:10 54:2 81:5

excise 79:17

extant 68:24

else's 19:15

38:16,16 45:1

eventually 7:24

excludes 31:22

extent 6:8,23 7:5

embark 30:6,7,9

54:6,9 79:10

36:4 96:5

Excuse 3:18

26:19 77:14

embedded20:23

89:7 93:6,14,15 everybody 5:19

execution 4:23

extraordinarily

44:19

95:19 96:12

8:25,25 12:18

22:25

88:9

emergency 6:2

105:6 108:9

13:2,3,4,9,10

exempt 5:17

Extraordinary

6:11,23 15:24

entered89:4,14

19:15 22:22

59:20

53:16

16:6 24:5 55:10

93:10 95:5,15

31:22 32:5,14

exemption 59:16 eyes 13:25

55:18 62:22

entering 89:16

33:11 35:13,13 exercise 25:19

68:15 74:14

entire 56:20

40:25 41:8,11

35:4,7,22 41:8

F

75:2,4,9,16

entirely 30:15

41:24 42:3,25

41:9,11 45:23

facial 92:13 94:3

88:2 99:4,16,18

84:19,20

46:4 53:4 58:7

46:12,23 47:2,7 facilitate 6:10

100:14,17

entitled11:16

59:12,16 64:15

48:3,25 49:2,17

72:20

103:8

32:20 74:13

64:21,25 65:4

49:22 50:2,4,6

facing 90:6

eminently 25:1

entry 44:25

65:13,14,15

59:23 63:17,19 fact 5:16 11:7

emission 94:12

enumerated14:5

70:5,23 72:4,18

78:7 110:12

15:19 45:7 47:3

94:12

28:14 30:13

72:19,20,22

exercised77:13

49:15 56:23

emphasize 76:12

80:24 82:14

74:3 88:3 93:9

exercises 46:23

61:24 76:13

employer3:22

environment

93:13,15,21,21

48:20

79:22 88:14

4:3 29:7

16:8 22:22

101:7 102:19

exercising 47:13

89:12,12 92:15

enact 4:18 11:8

environmental

102:23

47:14

92:16

16:11 44:9

94:20

everybody's

exist 15:16,17

factor 25:7

95:11

envision 110:9

13:15 40:16,19

77:24

factors 14:12

enacted22:17

envisioned110:5

73:21

existed15:12

51:15

95:8 108:24

EPA 88:18

evident 27:21

existing 17:12,15 facts 92:19 96:18

enacting 33:15

epidemic 85:22

28:12

17:15 18:20

fails 102:5

44:8

equally 8:7 27:21 exact 11:7

19:5,21 54:8

failure 5:11

encourage 77:5

28:12

exaction 48:6

87:18 92:7

43:23 72:10

ends 37:15

equation 34:8

exactly 36:24

exists 26:18,21

78:19 91:7

enduring 3:12

equipment 88:16

40:11 41:18

28:10 65:18

104:2

enforce 51:21

equivalent 52:5

77:10 79:3 80:7

79:9

fair 36:10 48:2

100:7,9 102:12 era 66:25

88:8 106:24

expand 20:25

49:13 50:4

enforced46:19

ERISA 4:4 15:24

109:25

expenses 66:6

93:13

52:1 76:16

29:9 43:10

example 8:12

expensive 19:12 families 14:22

99:17,20

especially 35:24

15:9,21 37:3

34:16

84:8

enforcement

ESQ 1:16,19,21

51:23 67:18

experience 23:3

family 9:12,24

52:7

2:3,6,9,12

88:12 94:4,11

36:25

73:25

engage 44:13

essential 27:13

95:7 96:21,24

experiences

far 54:9 55:8

73:17 93:1

32:11 33:16,17

97:3 110:4

38:23

farm 96:21

engaging 33:19

essentially 54:10 examples 96:17

explain 86:19

farmer61:20

enormously 35:1

56:19

exceeds 81:21

explaining 49:21

65:2 96:22

ensure 12:11

establish39:11

82:3

explains 14:2

farms 95:22

Alderson Reporting Company

Official - Subject to Final Review

119

faster62:6

first 12:6 14:8

forget 90:2

General 1:16 3:6

84:12

fatal 68:5

21:12 23:15

forgo 54:15

3:9 4:12 5:2,13 Gibbons 77:11

feature 5:21

44:6 47:11,19

forgone 52:6

6:13 7:7,15,17

79:7

25:18

51:17 54:10

forgotten90:4

8:5,10 9:2,5,11 Ginsburg 10:23

features 42:10

61:2 65:9 66:21 Form 46:17

9:14 10:19,25

14:14 19:2,6

federal 4:11 16:6

69:4 73:11

formulated60:9

12:5 13:5,13

46:18,24 48:4

27:22 28:14,16

74:18 76:6

forth 77:16

14:7 15:4 16:2

48:17 58:2 59:5

29:8,17,20

78:12 79:10

found 7:21 9:23

16:10,14,22

84:1,7,16 90:8

30:14,17,22

83:4 97:18

86:25

17:8 18:3,6,11

90:13 91:13,18

31:12,15 41:10 five 93:23,24

foundation 23:23

18:16,19 19:2,4

97:11,22 98:4

43:12 49:1 53:2 five-year 12:17

founding 100:17

19:19 20:4,8,12

98:14

62:19 66:16

fledgling 73:13

fraction 83:15

20:20 21:2,7,8

give 25:13 54:8

67:3 71:15 73:2 flood 105:4,4

framers 60:16

21:10 22:16

64:20 81:14

79:24 80:3,16

floor 49:16

64:3 73:15

23:7,11,14,25

85:2 97:20

80:24 85:25

Florida 1:7,20

79:16 89:25

24:11 25:15

108:13

86:14 95:12

2:7 3:5 54:2

107:25 108:12

26:19 28:3,11

given29:20 40:5

100:19

focus 74:24

110:9

28:18,22 29:15

50:2 56:9 68:1

federalism80:5

focuses 106:13

frames 83:7

29:18,25 30:19

68:3 102:10

federalist 73:5

focusing 61:9

framing 60:18

31:17 32:8,18

gives 42:9 44:10

80:9

food 13:9,10,14

free 19:16 84:17

33:14 34:5,23

54:7 84:25

fee 45:22 46:6

14:15 18:2 72:7 freedom 108:3

35:12,25 36:1,6

96:21 98:24

feed 96:23

foods 94:24

friends 8:16

36:16,20,23

giving 89:22

fees 46:3,4,4

forbid 12:23

24:12 30:8

38:1,6,11,18

106:3

fellow71:15

20:22

front 31:7 84:14

39:8 40:8,13

go 11:22 13:18

86:22

forbidden79:18

fuel-efficient

41:1,13 42:1,5

13:19 19:6 22:7

fewer11:12,12

80:3

60:5

42:16,22 43:9

35:20 41:10

23:4 37:13,14

force 23:10

fully 83:9 95:25

43:19 44:1,3,5

58:15 61:4 62:7

37:14,14

43:22 55:4

101:21

45:10,12,20

62:10 63:10

figure 57:1 59:8

57:21 63:25

full-stride 93:20

46:8,22 47:10

65:22 70:21

figured33:24

72:22 75:13

fundamental

47:20,24 48:16

74:10,14,14

figures 10:3,13

94:21 98:19

3:12 7:7 10:21

49:3,12 50:10

75:15 79:8

84:7

106:14

31:16 33:5

50:14,23 51:1,4

83:22 86:15

Filburn 64:12

forced16:24

80:23 101:3

51:8 52:12 53:6

88:6 90:2,2

65:1

32:24 33:2

fundamentally

53:10,14,17,19

91:15,21 96:22

financing 5:6

35:18 59:18

81:13 95:15

76:6 79:21 80:6 goes 24:5 25:14

7:23 8:8 17:21

75:17 90:16

Furniture 51:13

82:16 83:8

51:2 66:23 69:9

65:19

94:14,16,23

51:22

108:17,21

74:21 75:13

find 57:12 64:9

96:22

further79:8

111:2

96:24 105:11

Finding 57:24

forcing 10:11

fuss 58:12

generally 5:22

going 5:2 6:4,6

findings 54:13

11:4 15:2 37:17

31:10 59:12

6:22 7:5,24,24

58:1 75:23,23

58:17 64:6 74:7

G

General's 54:19

8:2,24,25 9:9

fine 86:15 88:11

83:21 97:9

G 3:1

78:13 81:9

9:12 10:16,23

90:22 98:11

foregoing 96:4

gallons 93:23

generation 60:18

13:6 14:4 17:13

102:13 105:1

foreign 73:12

Garcia-ize 77:5

getting 20:15

19:17 20:10,13

fire 6:2 7:4

forever34:7

geese 56:19

27:2 71:12

20:13 30:6,16

Alderson Reporting Company

Official - Subject to Final Review

120

32:5,16 33:6,11

67:3,21 70:24

37:1 38:25

57:3 59:17,18

9:23 20:1 35:8

34:3,7,7,10,13

71:15 72:15

57:17,17 59:9

60:6 65:12,18

37:13,13 57:19

34:14,18 36:14

73:2 79:25 80:7 guaranteed-iss...

65:19,22,24

57:19

36:22 37:9,21

80:17,25 83:7

8:18 22:18

67:7,9 68:6,8

highly 37:2 39:4

39:15 40:17,19

85:25 86:14

34:25 97:21

69:23 70:1,2,3

highway 16:5

40:21 54:20

87:24 88:1

guarantees 66:4

70:5 72:12,13

high-risk 55:22

58:9,21 61:7

90:21,23 93:23 guise 51:14

72:19,23,23

HIPAA 4:5 29:9

63:23,25 64:20

94:9,10,15,18

74:13,13 75:17

43:11

64:21 66:14

94:25 95:2,17

H

81:10,11,16,23 history 4:7 29:4

68:23,24 70:20

95:21 96:19

Hamilton 60:20

82:24 83:1,5

49:20 61:11,12

74:21 75:8,10

97:15 99:14

hand 25:11 80:24

84:12,18 86:24

61:16 63:8 69:5

75:12 76:12

103:8,9,9,10

handle 38:24

86:25 87:10

106:16

77:25 79:1

103:12 104:13

52:17,19

88:6 89:15

hit 34:10,14

82:25 83:9 85:9

109:21 110:2

happening

92:12,16,20

83:12

88:24,25 91:14

110:23

102:16 104:11

93:3,16,18,19

holders 75:11

92:20 93:14,15 government's

happens 11:7

97:8,14 98:7,20 home 57:1 61:21

96:5 99:17

56:21 57:25

22:5 31:20

98:23 99:19,20

96:24

101:16 102:11

64:24 69:11

71:17

99:21 100:6,6

homeowner's

102:14 105:20

75:24 88:9

hard 72:2

100:10,11

105:4

107:12,13

93:14 98:18

harm 87:22

101:7,16,17

homes 60:4

golden56:19

106:25

harmful 104:6

104:3,4,6,17

home-grown

good 39:23 42:23 grain 96:23

harms 84:24

105:14,25

91:15

61:6 98:21

grasp17:19

health 1:3 3:5,12

108:25 109:24

honest 25:9

goodly 19:13

grave 89:19

3:14,16,21,25

healthy 7:21 10:8 Honor 17:11

goods 94:24

108:23

4:15,15 5:6,7

15:2 32:23 33:1

28:19 30:1

95:19

great 58:16 64:5

5:14,15 6:6 7:1

33:3 34:6,7

32:19 50:15

gotten67:10,12

66:6 72:16,17

8:8,9,14,23,24

36:8 37:24

52:15

97:5

72:18,21 110:8

9:20,24 10:10

57:13 58:8

hope 67:11

governed79:7

greater54:9 73:3

11:17 12:7,19

75:13,14 97:18

104:25

government 3:22 greatest 76:10

12:23,23 13:1,2

100:23 105:11

horsepower

4:11 6:9,24 7:1

ground 23:6 42:2

17:14,20,21

hear 78:3

94:14

7:4 12:1 14:3,6

89:9 97:12

18:7,8,21,22

heard 76:5,18

hospital 14:21

15:19 21:19,22 group 33:22,24

20:13,15,17

hearing 103:24

24:5 88:7 109:6

21:24 23:10

34:1,10,13,14

21:25 22:2,7,8

heart 6:7 13:3

109:12

25:8 27:22,23

56:15 58:20

22:22 23:20

heavy 11:23 12:3 hospitals 88:1

27:24 28:1,14

62:16,21 71:18

25:6 26:13,14

held 27:15 80:15 hour 7:20 62:6

28:14,16 29:17

84:19 103:20

26:25 29:7

help 11:18,18

house 61:20

29:20 30:14,22 groups 5:16

31:19 32:14

helping 89:24

70:20

30:24 31:11,12

31:21

33:23 39:7,12

helps 37:13

huge 10:11 72:18

31:15 41:11

growing 61:19,21

40:9,15 41:10

87:17

75:18 86:24

49:1 53:2 58:15

62:7

41:15,24 42:13 hey 62:5

97:7

58:23 59:1,2,16 guarantee 22:2

42:16 48:7,12

high 36:18 85:24 human1:4 3:5

59:19,20,21

37:8

48:13 53:4

102:21 109:10

18:15 71:11

60:7 62:19

guaranteed4:21

54:16,20 56:16

109:13

89:14,19 110:8

65:11,12 66:17

11:2,8,15 23:2

56:17,24,25

higher9:21,22

hunting 46:4

Alderson Reporting Company

Official - Subject to Final Review

121

hurt 16:7 72:1

93:8 95:5,6

4:4,7,19 10:9

42:11,12 44:21 Internal 46:15

100:21

110:17

12:1 29:12 31:3

48:1,9,13 52:6

50:17 52:2

hurting 20:2

imposed55:11

31:12,15 66:18

53:4 54:16,21

interpreted

Hylton 61:1

100:18

108:3

55:3,4,12,21

110:6

hypothesized

imposes 51:9

individuals 3:24

56:16,25 57:10 interrupted19:8

99:17

imposing 44:21

31:19 54:5

57:12,22 58:6

interstate 5:8

hypothetical

46:2 109:3

57:22

59:3,8,19 60:6

14:10 17:5

6:21 87:20,21

imposition 36:25 industries

65:12,18,20,21

23:21 29:1 30:5

hypotheticals

67:21

104:22 107:5

65:24,25 66:3,3

31:1 41:24 42:3

65:6 74:16

impossibility

industry 59:3,9

66:8,13,16,18

43:7,24 61:18

55:3

64:19 71:6

67:7,9,18 68:10

72:2 76:23

I

impossible 29:3

77:25 107:1,2

69:23 70:1,4

88:16,17 92:1

idea 42:19 75:7

impression 72:14 ineffectual 37:2

71:16,23 72:12

95:19,24 96:9

identified14:13

86:22

inevitably 21:8

75:4,14,17,18

96:12 103:21

51:13,15 60:17 impressions

inextricably

78:14 81:10

intervention 68:4

64:3

99:14

65:19

83:22 84:8 88:6 intrastate 80:21

identify 16:20

inactive 106:22

infer48:2

89:11 91:11

95:23 96:8,11

106:23

inactivity 107:20 injecting 105:18

92:21 93:7,9,19 intrusion 39:20

identifying 11:2

incarcerated

injured67:12

96:4 98:2,3,6,7 intrusive 95:16

ignore 79:22

5:19

inoculated72:1

98:16,20,20,23 intuitively 95:13

illegal 103:4

incentive 48:1

86:1,2,14

99:6,20,22

103:2 108:8

illegitimate 35:4

110:18

inoculation 62:20

100:7,10,14,24 invading 29:4

illness 41:9

incentives 52:21 inside 105:22

100:25 101:1

invalid 82:4

83:13

64:20 70:9

insofar 56:24,25

101:18,25

inverse 63:5

illogical 88:10

incentivizes

Institute 91:2

102:2 103:11

investment

98:18

101:24,25

insurance 3:13

103:15 104:3

58:16

illuminates 50:25 include 43:2

3:15,18,21 4:1

104:14,17,20

involuntarily

illustrates 106:2

44:10 73:16

4:18,19,24 7:12

105:4,9,14,25

6:18 89:13

imagine 20:20

97:17

8:1,14,23,24

107:1 108:25

involuntary

immutable 33:1

includes 79:5

9:22,25 10:5,12

109:3,8,12

13:17

impede 97:25

82:8

10:24,24,25

insurance-based involve 32:2

impermissible

including 44:11

11:4,10,13,14

56:9

58:24,24

60:11

increase 47:25

12:9,12,21,23

insure 83:23

involved26:9

implicate 33:18

increased86:25

14:16 17:1,2,20

97:13 98:9,15

involves 45:14

implicit 27:18

increasing 73:25

18:7,17 20:11

insured68:14

71:23

imply 91:20

incur 66:5

21:16 22:1,1,8

insurer37:6

ironic 25:23

import 30:9

incurring 36:18

22:9,18,21 24:4 insurers 32:9

irrelevant 49:11

important 6:25

Indian 5:19

24:15 26:14,15

58:25 90:20,23

57:10

36:11 73:4 79:3 indicated55:12

29:23 32:19

97:12

IRS 46:16 50:18

107:14

indicia 47:1

33:13,25 36:14 intended84:9

issuance 21:16

impose 8:18,19

indirect 60:20

36:19 37:9,11

98:2

issue 4:21 7:9,9

24:15 42:6,11

106:19

37:14,17,20

intent 14:17

11:2,8,15 20:25

52:10 60:15

indirectly 94:9

38:16,21,22

interfere 28:5

22:9 23:2 30:18

66:16 89:12

indisputably 67:1

39:7,9,17,24

91:10

37:1 38:25

92:17,22 93:1,7 individual 3:24

40:8,22 42:6,11 interlinked65:20

45:14 55:9

Alderson Reporting Company

Official - Subject to Final Review

122

57:17,18 59:9

20:9,18,24 21:7

82:12,22 83:3

69:25 73:18

92:14 96:24

83:7 86:4

21:10 23:6,8,12

83:17 84:1,7,16

74:5,11,18 85:6

102:20

103:17

23:25 24:11

85:6,8,15,17

85:8 86:18 90:2 knows 46:4

issues 59:22

25:3,16 26:8,20

85:18,20 86:6

90:4,7,10 92:9

Kurth 51:13

105:5

27:2,10 28:8,12

86:10,12,17,17

106:9 107:23

item91:8

28:20 29:13,16

86:20 87:1,3,5

keep 15:1 83:4

L

it'll 91:23 98:11

29:19 30:11,20

87:19,20 88:8

Kennedy 4:25

label 80:4

104:15

31:2,17,24

88:11,14,24

5:3 11:18 12:6

labels 49:8 80:8

i.e 21:14 87:12

32:12 33:7,21

89:8 90:1,2,4,7

15:10 16:18

labor 26:5 52:1

97:7 99:19

34:12,24 35:10

90:8,10,11,13

17:4 25:3,16

70:21

100:10

35:24 36:3,7,13

91:13,18 92:9

27:2 31:2,18

laborer51:24

36:17,21,24

93:12 94:5,8,21

56:21 57:6

lack 41:9

J

37:19 38:2,4,10

94:23 95:17,25

70:14,17

large 37:18

Jersey 37:3

38:13 39:6,10

96:2,14 97:11

104:10,13,25

62:15 71:17

job 15:16 70:22

40:11,14 41:1,4

97:22 98:4,14

105:20

99:6 106:9

join 41:11

41:7,14,17 42:4

99:2,10,25

Kentucky 37:5

larger43:25

joined76:7

42:14,18,23

101:2,5,10,12

key 8:15 30:11

late 98:16

Jones 26:6

43:13,18,20

101:14 102:4

64:24

latitude 25:13

JR 1:16 2:3,12

44:2,4 45:10,13

102:15,18,23

kids 35:19

32:20 33:16

3:7 108:19

46:3,18,24 47:8

103:5 104:1,10 kind 19:7 30:7

68:25

judge 96:16 97:2

47:10,16,22

104:13,25

34:2 44:11

Laughlin 26:6

105:3

48:4,17 49:3,14

105:17,20

73:11 83:1,11

Laughter41:6

judgment 36:2

50:8,11,20 51:1

106:9 107:16

91:8 105:14

87:6 88:13 90:5

41:21 66:11

51:6 52:9,23

107:23 108:7

109:19,25

90:12

100:16 110:1

53:8,12,16,19

108:15,22

110:4

law5:4 21:3 31:4

judgments 32:21

53:23 54:3,18

110:4 111:2

kinds 29:10

31:5 32:1 45:24

68:25 107:14

54:23 55:2,6,12 Justice's 69:10

55:14 75:8 95:7

45:25 49:16,21

110:21

56:2,11,21 57:6

77:22

96:18 102:1

69:12 76:14,15

junior90:11

57:8 58:2 59:5

justifiable 53:14

106:11 107:5

80:2,4 81:22

jurisprudence

59:15,25 60:3

justification

knew68:16

82:4 87:21 91:5

54:24 107:3

61:4 63:4,6,12

11:23 12:3

know5:10 6:4,6

92:15 95:12

justice 1:17 3:3,9

63:15 64:5,23

19:20 78:15

6:21 7:22 13:6

laws 11:24 16:11

4:10,13,25 5:3

65:9,16,23

justified54:14

13:18,24 20:19

21:13 95:8,8,11

5:9,14,25 6:13

66:12,19,23

63:16,17

33:6 34:9 35:15

103:8

6:20 7:8,13,16

67:9,16 68:2,11 justifies 15:6

35:18 36:21

lawyer75:20

7:17,19 8:6,22

68:21,22 69:9

justify 16:24 17:1

45:18 46:3

law's 91:1,4

9:4,6,8,12 10:1

69:21,25 70:14

34:20 41:14

50:23,24 57:5

lead 57:15

10:23 11:18

70:17 71:7 72:5 justifying 18:25

60:12 61:1

leave 72:14

12:6,25 13:5,8

73:18 74:5,11

63:23 64:1 66:7 leaves 109:20

13:22 14:14

74:18 75:25

K

67:8 68:21

left 27:25 29:23

15:7,10 16:3,10

76:25 77:2,10

Kagan 23:25

69:16,19 70:11

37:6 58:15

16:12,18 17:4

77:11,19 78:2,3

24:12 35:24

71:7,10,12,13

110:1

17:17 18:4,7,9

78:4,22,23

36:3,7 49:3,14

71:14 72:3 78:7 legal 92:1 102:12

18:14,17 19:2,6

80:10,14,18

56:2,11 65:16

83:14,17,19

legislate 66:17

19:7,23 20:5,6

81:1,6 82:5,7

65:23 69:9,21

84:4 87:7 89:1

67:4

Alderson Reporting Company

Official - Subject to Final Review

123

legislation 53:3

live 35:13

M

9:20 10:5 12:7

94:1 96:8,9,11

71:2 79:19

liver13:4

Madison 60:21

12:13,14,15,18

96:13 97:8

97:23 108:6

living 57:2

73:5

13:1,9,10,11

104:14,15

legislative 49:20 loaves 64:16

main 14:15 81:9

13:14,16,17,19

106:12,12

legislature 76:16 local 28:24 76:9

82:23

14:16 15:5

109:24

legitimate 89:10

87:4,8 91:22,24 maintenance

17:14 18:21,22 marketplace

97:23 100:9,15

92:4

42:12

19:11 20:13,14

95:5 105:6

let's 25:4 91:17

Lochner30:11

major 19:9,9,18

21:19 22:18

markets 72:6

95:4

30:18 39:16

majority 28:15

23:20 25:20

94:18 104:18

level 43:12 52:19

66:24

67:11 87:4

26:13,15,25

104:18

96:12

Lochner-style

making 19:11

29:5,12 31:19

married62:9

leverage 104:8

30:9

21:23 32:20

31:20,23,25

Marshall 77:11

106:4

locked-in 66:4

47:16 62:4

32:13,17,22,25

110:5

libertarian 91:2

long 38:22

69:15 72:24

33:3,4,12 37:4

Maryland 14:20

license 45:21

longer67:4

74:2 84:2 100:7

37:5,6,11 38:17

15:14

46:3,4 47:3

look 35:17 40:17

100:23

39:12,15,19,24 Massachusetts

79:21,25 80:3

40:20 49:7,7

man 31:7 62:7

40:7,16,19,24

109:16

life 68:4 95:2

51:16 57:11

mandate 10:2,9

41:16,24 42:3

massive 22:5

104:16

61:1,11,12,16

10:10,14 21:3

42:10,25 43:5

29:7 105:15

limit 23:12 43:14

61:19,20 64:8

33:23 52:9 54:4

43:10,10,11,11 match 83:4

78:7,9 79:2

68:13 69:18

54:14 55:21

44:24,25 45:1,2 maternity 32:2

82:11

71:3 73:23 80:8

80:11,13 89:23

45:3 53:7 55:16

32:16 33:10

limitation 109:22

98:19 100:4

100:1

57:10,12,22

matter1:12 6:12

limitations 40:3

102:13 105:23

mandated88:1

58:16,24 60:25

53:1 56:3,10,12

77:14

106:16

mandates 20:25

62:8 64:11,17

66:1 76:3 81:15

limited27:24

looked7:11

mandating 24:4

64:25 65:2,4,5

87:4 111:5

30:13 39:7,8

45:13 80:4

mandatory 21:15

65:10,12,13,14 matters 23:3

43:1 60:14

looking 26:20

21:17

65:15 66:7

27:4 47:12

78:17 80:24

63:7,7

Manhattan

67:20,22,23

81:17 104:17

89:21

Lopez76:7,17

67:18

69:8,13,13,20

McCulloch

limiting 43:21

78:6,7 79:2

manner26:18

69:22,24 70:1,2

15:14 63:13,14

51:2,5,7,12

lose 70:22

110:7,24

70:4,5,5,13,14

109:20 110:5

54:17 74:6 76:2 lot 33:9 34:17

manufacturing

70:16,21,25

mean 8:15 13:23

76:5,10,12 77:3

55:7,12 58:13

95:18,21

72:12,13,23,23

14:2 16:8 27:6

77:8 78:15

61:7

106:19 107:19

75:14 78:14,17

27:13 29:19

94:19 106:25

lots 11:4 67:17

March 1:10

78:19,20,21

46:5 48:23 49:6

limits 16:19,20

79:12

marijuana 48:17

81:11,24 82:9

56:19 57:9,11

30:16,17

low52:19

61:20,24 62:10

83:6,23 84:4

60:12,18 61:1

line 107:8,17,18

lower57:15,23

market 3:24,25

87:11 89:4,7,14

61:24 62:12

107:19

98:20

4:3,4,7,18,19

89:15,17 91:9

64:10 65:18

liquor 92:6

lowering 56:20

5:10,11,15,15

91:16,22,25

67:10,25 72:13

listed46:19

lowers 75:19

5:20,20,23,24

92:1,1,2,6,7,8

78:6,25 94:5

literally 89:18

105:18

6:1,8,15,15,16

92:13,16,21

98:10

little 25:22 60:9

lunch 7:20

6:17 7:9,9,11

93:7,10,14,16

meaning 66:13

60:21 65:17

7:12,14 9:7,19

93:19,20,21,22

68:4

Alderson Reporting Company

Official - Subject to Final Review

124

means 3:14,15

2:9 81:4

48:24 93:7,7,9

needing 58:5

71:17 85:24

4:15 17:21 18:7 midst 62:25

93:14

needs 13:2,3,4

numbers 37:18

18:12,14,18

miles 62:6

move 41:2 43:20

35:14

105:17

19:22 23:17,18 milk 35:20,21

moving 17:11

negative 86:22

nuts 75:5

24:22,23,24,25

93:21

mufflers 16:7

92:7

25:2,4,11 26:22 million 3:20

multibillion 4:2

negatively 81:18

O

38:21 39:7

22:20 38:20

81:19 85:1,4,13 O 2:1 3:1

41:15 43:6

62:18,19,20,21

N

91:6

objectives 24:18

89:18 90:10

68:13,17,18

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50:16 89:25

101:23 109:15

71:18 72:1

name 97:20

36:22 67:10,11 obligate 20:18

109:15,19

76:21 103:11

narrow76:7

67:12 71:9

21:16

meant 39:13

103:14,20

77:24

107:13 109:14

obligated20:17

measured57:3

108:24

narrower16:17

nevertheless

obligation 50:5

meat 93:24

mind 46:25

nation 73:14

45:15

110:21

mechanism56:9

minimum 4:22

national 25:6

new28:5 37:3

obtain 13:20

mechanisms

5:17 8:19 11:10

26:4 28:24

52:17 64:22

obtaining 18:22

25:20

12:8 22:24 23:1

30:24 61:13

71:8 72:17 73:6 obviously 82:14

Medicaid 3:23

23:17 24:18

71:22,23

82:8 110:14,20

85:10 86:22

15:23 103:9

26:23 32:10

109:18

newborn 32:3

91:7 107:10

medical 4:6

39:1 102:6

nations 73:12

nexus 105:23

occur 8:21 29:12

36:18 37:22

110:12

nature 12:13

NFIB 1:22 2:10

29:12

48:7,13 76:22

minute 53:20

74:12

81:5

occurring 18:21

104:21

minutes 108:17

near 56:17

noncommerce

odd 90:20

Medicare 3:23

misheard 100:2

necessarily

107:22

offer11:15 32:9

15:23 103:10

misleading 99:14

22:10

noncommercial

office 55:14

Medicare/Me... missing 42:18

necessary 4:23

76:10

109:7

25:22

misunderstand...

12:11 21:13

nondiscriminat... offset 59:17

meet 84:10 102:5

104:25

22:24 27:11,12

98:1 100:25

Ogden79:7

member9:12

mix 83:4

27:13,14,20

noninsured

oh 26:8 39:23

members 49:21

model 25:22 59:1

42:8 44:9,12

56:23

86:8 90:22

68:12 76:13

modern 35:13

59:9 63:24 64:7 nontax 45:22

91:17 97:24

membership

moment 11:19

need 5:23 6:4,6

non-group 10:5

okay 28:20 53:16

41:15

11:20 22:9,12

6:11,19,22,24

non-risk 66:10

63:19 76:4 83:6

mention 49:25

42:13

7:1,3 8:24

norm 20:23 28:4

86:15 100:1

mentioned64:9

money 8:1 9:9

11:11 13:19

normal 73:25

101:10,12

merely 52:21

14:19 36:15

18:1,15 19:14

norms 20:16

104:12

95:19

53:5,13 58:9

22:2,12 32:5,14 Northern 26:2

old 58:5,10

merits 76:1

59:18 61:7 64:1

32:16 36:15

notwithstanding

once 39:11,11,24

met 52:22

71:23

37:10 42:11

87:10

41:19 42:24

method 5:6 8:13

monster108:6

44:25 48:7,13

novel 25:19,25

43:6,7 59:10

17:3 21:4 25:21 moral 31:9

53:8,12 58:20

25:25

68:23 69:21

26:25 40:9

100:13

82:25 90:18

now-conceded

71:3 73:9,18

41:22 42:20

morning 3:4 55:8

94:24 96:5

41:23

77:22 78:25

43:2 44:20

Morrison 86:4,9 needed105:15

number19:13

89:3

MICHAEL 1:21 mortgage 48:23

110:6

46:19 47:17,17 ones 58:9,21

Alderson Reporting Company

Official - Subject to Final Review

125

68:14 76:7

part 6:25 10:2

21:25 22:1,8

20:17 21:1,5

12:16,17 14:21

90:17

23:15,16 32:7,8

34:19 40:18

22:20 23:4

22:4 29:6 51:23

one's 44:25

43:25 55:16

45:3 54:21

26:16,24 29:6

62:22,23 76:14

open77:23

103:22,23

56:20 58:9 59:9

29:22,22 32:1

77:21 83:5

operated73:9

106:9

59:12,13 62:24

32:15 33:1,9,13

85:23 88:15,17

operates 65:11

participant 33:4

65:7 66:5 67:13

33:22 34:3,13

88:18 104:7,8

operation 49:7

94:1

69:15 70:23

34:14,22,23

105:12,12,19

opinion 96:16

participants 9:7

71:16,17 74:15

35:5,8 36:13

percentage

opponents 49:23

9:19,20 45:4

84:2,13,14 88:6

37:4,5,8,11,14

83:13 99:3,6

opposed30:17

91:9,22,25 92:7

90:16 99:22

37:18,24 38:20 perfectly 32:23

opposite 11:7

92:8 95:14 96:8 payer25:6

39:25 40:1,18

100:9,15 105:1

47:4 80:7

96:9 106:11,12 paying 3:14,16

40:21 43:22

period 12:17

optimal 69:8

participate 5:18

8:13 15:22 21:4

44:13 48:1,6,9

68:9

option 67:20

6:8 19:11 26:24

39:7 58:17

52:11 54:9

periods 106:18

106:2

32:17 33:11

62:23 66:2,2

55:22,24 56:15 permissible 82:3

options 59:5

39:25 92:16

74:22 83:9 84:8

56:18,19 57:11 permitted67:4

oral 1:12 2:2,5,8

participates

84:11 88:2

57:16 58:5,13

pernicious 99:13

3:7 54:1 81:4

31:22 32:13

102:7,18,19

58:14 61:7,8

person 13:7,24

order5:1 9:21

40:25 41:25

payment 17:3

62:5,18,22

31:6 34:10 57:1

12:23 20:1 35:9

42:3

18:8,12 26:25

63:10 64:6 66:8

61:19 62:16

49:15,18 54:6

participating

40:9 41:15,22

66:13 67:11,17

104:19

63:5 80:4,8

40:2 65:3

42:20 43:2

68:8,13,17 69:6 pesticides 94:25

81:10

participation

44:20 59:17

69:12,14,14

Petitioners 1:5

ordinary 55:13

12:7 13:16

66:4 70:4 102:8

71:8,18 73:10

1:18 2:4,13 3:8

55:14

17:14 31:18,23 payments 84:19

73:17,20,25

108:20

ought 25:9 30:9

particular 24:3

93:3 104:4

74:2,8 75:13

phone 6:10 35:10

47:25 109:25

40:17 42:10

pays 59:16 74:3

76:22 77:23

phones 15:20

outside 67:23

65:2 89:14

pediatric 32:3,6

78:8,9,18 79:10

16:4

87:12 96:11

particularly

32:16 33:10

80:1 83:21 84:9 physician 12:16

105:21

23:23 76:9

penalties 46:19

84:12,17,18,20 physician's

108:2

46:21 48:19

86:1,5,12 87:22

109:7

P

pass 21:13 80:11 penalty 24:16

88:5 90:15 92:5 picked71:19

P 3:1

80:13 91:11

45:15,17 46:7

92:11,15,21,22 picking 85:20

pack 102:12,14

passage 17:18

48:10,10,14

92:25 93:1,6

place 54:11

102:20

passed 54:12

50:15,22 52:4

96:10,19 97:17

74:19 75:2

package 38:25

74:25 79:25

52:11 99:22

98:5,12,14,19

79:10 83:4

39:2

paternalistic

100:11 102:12

99:3,15,18,23

plans 56:17

Packers 26:3

83:22

penalty's 100:1

100:8,14,16,23 plants 95:21

page 2:2 75:23

PAUL 1:19 2:6

people 4:6 5:22

103:11,19,21

playing 83:4

pages 96:17

54:1

6:17 7:21 8:24

105:2,21

please 3:10 54:4

paid 12:21 35:8

pause 53:20,22

10:11,15 11:5

106:11,20

81:7 85:8 86:17

46:16 52:5

pay 7:25 9:9,13

11:11,12 12:12

108:8 109:6

86:19 104:1

paradigm 110:3

10:16 12:19

13:11 15:2

people's 12:7

plenary 81:14

parallel 110:15

13:21 14:22

18:21 19:10,12

17:13

89:17,20,23

parent 99:5

19:25 20:11,14

19:24 20:2,10

percent 3:17

106:3,8 108:14

Alderson Reporting Company

Official - Subject to Final Review

126

point 8:21 9:1

76:20,21

practical 49:7

102:20

40:18,20 51:1

12:9,12 14:15

108:10

practices 29:11

prevailing 64:17

53:7 55:17 58:5

17:19 19:9,14

possible 55:19

precisely 75:14

prevent 84:13

58:20 65:13

24:4,12,16 28:8 possibly 43:22

75:15,16 95:12 preventive 55:13

70:7,11 71:22

29:14 34:9,12

98:5,25

99:20 103:1

previous 31:14

71:23 74:17

36:6 42:7 45:21 potential 105:10

108:12,13

previously 15:11

83:10,10 84:1,2

47:4 49:14,18

power8:18 12:11

110:15

15:16,17

92:23 93:5

54:25 55:4,20

12:11 23:13,24 preclude 4:5,5

pre-existing 4:21

98:22,24 101:4

55:25,25 56:8

25:5,9,10,19

4:20,20

29:10

101:25 105:10

56:14 66:21

30:17 35:5,7,21 predecessor

price 19:25 20:1

105:24 106:15

67:14 68:7,23

35:22 39:13,17

96:4

26:6 35:15

106:23,24

71:1 77:22

39:18,21 40:4

predicate 46:1

64:14,17 72:22

108:23 109:3,8

78:12,13 82:23

41:3,20 43:1,15

52:20,22

74:3,8,10 75:19 problems 4:10

83:1 84:15,25

43:16 45:23

110:18

102:20

24:10 38:13

87:5,9 90:1

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57:7 64:19

103:1 109:4,10

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predict 6:23

pricing 29:11

67:25

pointed103:7

48:3,20,25 49:2

55:15 71:13

principle 18:24

proceeded55:8

points 55:7 93:17

49:17,22,25

predictions 69:1

27:21 28:9,13

process 30:10

police 6:2,22 7:3

50:2,4,6,13

predominant

28:13,17 42:25

61:10 66:24

77:7 79:2 80:22

51:8 53:15 54:7

3:14,15 12:20

43:21 51:2,7,12

78:1 95:18

89:20

54:9 55:1 59:24 preexisting

54:17 74:6

producers 64:13

policed28:23

60:13,14 63:14

97:15

76:11,12,15

produces 38:14

policies 32:1

63:18,20 66:17 premise 38:9

77:8 78:15

product 13:20

policing 30:24

69:5 73:1,2,5,6

70:6 80:19 81:9

83:21 94:19

15:1,3 22:10

policy 10:5 33:25

73:9,13,16,16

premium 10:4

principled13:22

43:23,23 72:10

34:1,2 59:19

77:12,12 79:1,5

56:20 73:25

14:1

91:23 93:22

75:11 81:23

79:6,9,12 80:16 premiums 9:23

principles 45:6

94:6,9,17 97:9

91:4 106:5

80:22 81:14,20

19:15 57:15,19

51:5 76:2,5,17

97:10 105:8

107:14

81:22 82:1,2,2

73:21 75:19

77:3 78:4,5

107:6,7,10,12

pollution 88:16

82:8,10,14,17

98:20,23

91:2,3 106:25

107:15,15

pool 37:11 48:7

82:18,19,20

100:24 101:1

Printz28:4

production 72:21

55:22 57:14

85:1,3,10,11

105:19

prior 101:21

82:11

90:18 97:17

86:1,14 87:13

prescribe 79:6

private 58:15,24 products 82:10

105:18 109:10

87:15 88:18

prescribed77:15

58:25 72:16

profile 57:19

population 11:17

89:17,21,21,23 prescribing 79:8

90:19,20,23

profit 11:16

12:15 22:4 99:7

101:11 106:6,6 presenting 92:11

93:9 100:18

profits 51:24

105:12

107:9,11

preserve 80:5

101:17 103:11

profound 87:10

pose 55:17

108:12,14

90:19,23

problem3:12 4:8 programs 3:22

posing 33:8,8

110:13

President 47:8

4:9 7:11 10:22

103:22

position 5:14

powers 14:5

47:20,23,24

11:1,2 22:20

prohibiting 105:7

39:16 41:13

21:14 22:23

pressure 88:12

24:3 27:5 32:11 prohibits 105:13

44:19 54:19

27:23,24 28:14 presumably

32:22 33:20

prolonged83:12

59:3 93:15

28:15 29:20

57:18 75:3

36:11,23 37:20 promote 81:10

101:15,19

30:14 53:6

presume 11:24

38:2,5,7,12,19

81:16 82:1,8,18

possibility 67:14

106:3

pretty 43:8 61:17

38:19,24 39:3,5

82:19,19 106:6

Alderson Reporting Company

Official - Subject to Final Review

127

promotes 85:14

106:5

90:3,4,9,14

99:11

regulate 5:1

87:17

punishment

92:18 106:10

read 30:21 50:4

21:19 29:9

promoting 82:15

51:14

106:21

52:14,19 79:20

39:14,17,18

proper12:11

punitive 51:14

questioning

96:16 97:1

40:6,15,16,21

27:11,15,16,20 purchase 5:6,11

27:25

real 58:5 67:24

41:22,23 43:5,8

28:4 42:9 44:10

21:3,17 32:2,7

questions 46:10

74:16,23

43:10 44:20

63:24 64:7 69:3

33:10,13 34:3

63:4 91:4

reality 35:20

54:6,8,13,24

79:19

40:22 43:22,23

104:16

56:24 57:2

54:25 55:19

property 89:23

54:16 56:16

quite 13:13,14

realizing 60:14

56:4,5,10,14

108:5

72:10 78:19

17:19 71:20

really 10:1,15,21

65:1 68:24

prophylactic

81:10 85:14

29:3 53:1 76:2

73:12 77:12

93:11

87:17 91:7 94:2

R

78:6,10 92:14

79:6 82:2,18,20

propose 15:20

94:19 107:12

R 3:1

105:23 106:21

84:23 85:1,3,11

proposition

purchased4:16

radioactive

107:6

89:5,19 91:24

49:19

17:20,23,25

52:20

reason 8:11 31:2

92:4,5 93:4,6

protect 80:17

purchases 16:24 Raich 44:15

31:2 32:10 37:7

95:18 96:10

protected30:23

17:1 43:17

73:23 91:9 97:4

41:19,20 50:21

104:5,8 106:6

98:15

purchasing 18:22 rail 95:3

73:8 79:18

108:1

protection 48:12 purely 16:23

raise 25:5 35:19

87:25 104:5

regulated5:5

provide 3:18,25

76:9 95:23

48:4,8,15,19

105:15 108:7

11:14 26:10

10:11 55:21

purpose 16:25

48:21 59:12,22

109:5,17

43:11 55:17

69:15 76:23

48:6,21,21

73:21 96:23

reasonably

81:18 87:12

88:2 107:11

65:18

raised19:15

22:10 27:5,12

109:24

provided7:12

purposes 10:12

raises 49:1 51:3

27:13,16

regulates 21:4

12:24

17:2 57:4 69:7

raising 53:13

reasons 5:18

23:18,19 43:10

provider104:4,7

102:24

92:10,13

14:7 52:13

43:11 94:18

providers 9:20

put 39:16 58:4

Ranch 51:13

79:12 83:22

95:2

provides 6:24

63:25 64:6

range 32:14

89:6

regulating 4:14

23:22

88:16 94:20

rate 37:23

REBUTTAL

8:13 14:9 17:12

providing 53:10

100:25 108:6

rates 9:21,22

2:11 108:19

17:15 19:21

104:21

p.m 111:4

11:13,16 35:6,8 received10:18

22:7 26:11,14

provision 4:23

37:2,12 57:23

recognizes

26:14,17,21

8:20 11:10 12:8

Q

104:20

102:24

28:25 30:3,25

22:24 23:18

question 16:18

rating 4:22 11:3

redeemed81:22

43:1 44:8 55:25

24:19 25:25

19:7,8 23:10

11:9,15 23:2

reduce 81:11

65:7 77:20 91:5

26:23 27:9 32:2

24:9 25:16,16

37:1 39:1 57:17 reducing 81:16

91:18,19,22

39:2 46:1,2

27:3 30:15 33:8

57:18 59:10

refer49:5

93:25 95:14

52:19 110:12

33:18 42:7

rational 40:7

referred96:6

108:8

provisions 22:25

43:13,14 46:10 rationale 16:16

reflect 9:22

regulation 5:12

23:1 52:21

46:14 47:6 49:4

16:17,23 35:3

reforms 4:18,24

6:16 7:9,10

100:25 110:6

49:10 56:5 57:8

71:1 106:5

8:19 11:3,9

12:6 15:6 19:4

proximately

63:7,13 66:15

rationales 77:24

22:17,19 38:25

26:22,24 28:6,7

104:19

66:24 69:3,3,10 rationalize 15:25

39:2

30:12 31:23

public 100:18

78:8,11,23

63:1

refuse 97:14

33:15,19 38:8

101:7,16,18

84:22 89:10

reaction 63:23

regardless 87:13

38:14 42:20

Alderson Reporting Company

Official - Subject to Final Review

128

44:11,11 54:15

58:10 88:1,4

100:18 102:7

105:18 109:10

save 14:18 61:7

60:25 61:25

108:4

responsible

risks 17:22 44:12 saved 8:1 99:11

64:11 69:8

requirement

102:7

57:1,14

saving 60:6

78:16 80:21

5:17 8:15 24:15 responsive 41:18 road 15:25 62:6

saw58:5 109:15

81:16,20 82:8,9

42:6 44:21,23

rest 36:19 38:21

roadside 6:2

saying 20:5,7,10

85:2 91:10 92:8

51:25 52:7,10

53:3 84:2,11

ROBERTS 3:3

21:24 22:6

94:10,15 95:21

66:16 93:8

92:17,23 93:1

5:25 6:20 17:17

26:16 31:11

97:7,25 109:23

97:12 102:6

restrictions 95:6

18:4,9,14,17

39:16 52:23

regulations 4:5

109:4 110:17

95:7

30:11 31:24

58:22 69:17

96:18 98:1

requires 31:3

result 14:19

32:12 33:7 39:6

70:11 73:1 79:5

regulatory 43:25

32:9

19:15 20:15

39:10 40:11,14

96:3 97:8 98:19

67:24 82:3

requiring 10:15

35:22 84:17

41:17 42:4,14

100:8 101:6

reject 24:8

10:17 12:9 32:1

87:23,23

42:18,23 50:8

102:11,13

related46:21

32:15 33:9

results 22:20

50:11,20 53:19

103:3 106:7

relation 12:1

37:20 38:16

return 78:22

53:23 64:23

says 17:5 29:20

31:8

94:2 95:16

returning 107:2

78:22 81:1 82:5

41:11 62:24

Relations 26:5

100:10

revenue 25:5

82:7,22 83:17

63:18 73:5 74:1

relationship

rescue 31:6

46:16 48:5,9,15

93:12 108:15

78:17 79:21

31:15

reserve 53:17

48:20,21 49:1

111:2

94:10 100:4

relative 83:15

reserved29:21

50:17 51:3 52:2 Rock 26:7 35:16

102:5 109:20

relatively 57:13

30:23

59:12

role 90:19

scale 72:21

57:13 66:9,10

resist 80:19

revenue-raising

room 24:5 55:10

74:10

relevant 26:13

resort 3:24

48:5

55:18 57:2

Scalia 4:10,13

68:9 83:6,16

respect 30:7

rid 62:11

74:14 75:16

5:9,14 12:25

religious 5:18

32:18 35:14

riders 84:18

99:4 103:8

13:6,8,22 19:23

rely 25:20 69:1,2

43:5,6 44:7,15

right 7:19,23

rooms 75:3 99:16

20:5,6,9,18,24

remain 28:15

44:16,17,17

10:14,21 15:7

99:18

26:8,21 27:10

remaining

46:14 49:16

30:13 35:12

roughly 10:6

28:8,12,20

108:18

65:8 70:3 71:21

41:17,17,18

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70:15 71:11

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Scientists 69:18

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scope 32:21

Alderson Reporting Company

Official - Subject to Final Review

129

39:14

sensible 25:1

short 68:5

small 10:2 83:15

21:10 23:6,8,12

second 21:18

105:8

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77:10,19 78:2

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109:7

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76:7

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57:24

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103:9,9,10,12

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103:22

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102:7

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Sotomayor 21:7

24:13 27:17

Alderson Reporting Company

Official - Subject to Final Review

130

28:6,16 29:16

strands 21:11

71:5

88:5

51:21,23 52:10

29:21,21 30:12 strange 90:14

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survivor's 58:6

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103:16,21

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53:15 58:7

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62:18

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statist 91:3

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taxes 46:5,20,21

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94:13

Alderson Reporting Company

Official - Subject to Final Review

131

terrible 85:22

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110:17

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106:20

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88:15

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97:16 104:18

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Alderson Reporting Company

Official - Subject to Final Review

132

104:15

v 1:6 3:5 61:2

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Alderson Reporting Company

Official - Subject to Final Review

133

63:24 70:9

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105:11

100:23 104:19

30-year-olds

105:2

105:24

39 49:19

$

$10 102:19

4

$100,000 62:24

4 79:16 108:17

$250 29:8

40 3:20 22:20

$5 102:12,14

38:20 62:6,18

$5,800 10:6

62:20,21 68:13

$695 99:22

68:17 71:18

$854 10:10

76:21 85:23

103:10,14,20

1

108:24

1 22:4

43a 57:24 75:23

10 51:23 62:18

45 62:6 73:5

64:15 68:18

72:1

5

10:00 1:14 3:2

5 105:12

100 77:21 88:17

50 29:6 85:23

104:8

5000A(a) 110:17

100,000 64:22

5000A(b) 110:19

Alderson Reporting Company