National Federation of Independent Business (NFIB) v. Sebelius (2012)

"The Affordable Care Act is constitutional in part and unconstitutional in part. The individual mandate cannot be upheld as an exercise of Congress's power under the Commerce Clause. That Clause authorizes Congress to regulate interstate commerce, not to order individuals to engage in it. In this case, however, it is reasonable to construe what Congress has done as increasing taxes on those who have a certain amount of income, but choose to go without health insurance. Such legislation is within Congress's power to tax."

Key Rulings: 1) The individual mandate to buy health insurance in the Affordable Care Act (ACA) was not within the power of Congress to regulate interstate commerce because the failure to purchase health insurance is economic inactivity, not pre-existing activity that Congress may regulate through the Commerce Clause. However, the individual mandate is a tax, and a valid exercise of Congressional taxing power.

After Barack Obama's strong presidential victory under the banner of "Change", Congress passed the Patient Protection and Affordable Care Act (ACA), effective March 23, 2010. The ACA sought to force the millions of uninsured Americans to purchase health care as well, force states to increase their Medicaid coverage and force employers to provide health coverage for employees. The ACA minimum coverage provision stated that, by 2014, everyone who failed to purchase and maintain a minimum level of health care must pay a tax penalty. It also stated that states had to accept an expansion of Medicaid, which states had to accept to receive federal funds for Medicaid AT ALL, and an employer mandate to almost all employers were required to obtain health coverage for all employees.

Shortly after Congress passed the ACA, Florida and 12 other states brought actions in the United States District Court for the Northern District of Florida seeking a declaration that the ACA was unconstitutional on several grounds. These states were subsequently joined by 13 additional states, the National Federation of Independent businesses, and individual plaintiffs Kaj Ahburg and Mary Brown.

Chief Justice Roberts, joined by Justices Ginsburg, Breyer, Sotomayor, and Kagan, concluded in the majority opinion that the Individual Mandate penalty is a tax for the purposes of the Constitution's Taxing and Spending Clause and is a valid exercise of Congressional authority. The payment is not so severe as to be coercive, is not limited to willful violations like fines for unlawful acts, and is collected by the Internal Revenue Service by normal means. However, the Commerce Clause only allows Congress to regulate existing commercial activity, but not to compel individuals to participate in commerce. This would open a new realm of Congressional authority. So the Court expressly noted that this was not within Commerce Clause power.

As part of a jointly written dissenting opinion, Justices Antonin Scalia, Anthony Kennedy, Clarence Thomas, and Samuel Alito disagreed, arguing that because Congress characterized the payment as a penalty, to instead characterize it as a tax would amount to rewriting the Act.

The Sebelius case is relevant today as another huge roadblock to a vaccine mandate imposed by Congress. Just as Congress did not have the authority to regulate economic inactivity through the Commerce Clause with health care, they cannot regulate economic inactivity of those who choose not to get vaccinated. Failure to get vaccinated is not a pre-existing activity or aligned with people who make a certain income (although a substantial percentage of the unvaccinated are lower income minority groups), therefore its outside Congresses tax power as well. Therefore, Congress does NOT have the power to mandate vaccination.