In 2-1 vote the US 6th District Court Of Appeals has ruled that the mandate provision of Health Care Reform is valid.

As a bit of background, the Commerce Clause gives Congress the power to ‘regulate commerce among the several states’. It has been determined that this allows them to regulate any activities with a significant impact on interstate commerce.

One of the key cases that set down this rule was Wickard v. Filburn which had to do with government regulations on wheat farming. The law said a farmer could only grow so much wheat and Wickard was growing too much so he faced a fine. Wickard argued that since he was growing wheat for his own use and had no intention to sell it that it had nothing to do with interstate commerce.

The court ruled that since by growing the wheat he would not be buying wheat then he was in fact having an impact on the market by removing himself from it.

Needless to say this was and remains a controversial ruling, especially among conservatives who believe in a more limited federal government. But in the last 60 years only two laws have been struck down as being beyond the scope of the commerce clause.

In United States v. Lopez the Supreme Court struck down a law banning guns near schools while in United States v Morrison it struck down a law allowing women who were attacked to sue the attacker in federal courts.

The court determined that both laws had more to do with criminal activity that commerce, so the laws were struck on those grounds. But the rulings did not strike down the general rule that the Commerce Clause is extremely broad in scope and authority.

The commerce clause is important because the individual mandate has been a key dispute for the opponents of Health Care Reform who state that the government does not have the authority to make people purchase health insurance. Those supporting the reform counter that the government does have the power to regulate commerce and that the mandate falls under that category.

The Appeals Court seemed to agree with the latter view, taking the position that since the broad purpose of Health Care Reform was to regulate the health care/insurance market that Congress could do what was needed to achieve that goal (IE covered by the commerce clause under Wickard doctrine).

The key parts of the ruling were stated as follows

“Congress had a rational basis for concluding that the minimum coverage provision is essential to the Affordable Care Act’s larger reforms to the national markets in health care delivery and health insurance.”

“The activity of foregoing health insurance and attempting to cover the cost of health care needs by self-insuring is no less economic than the activity of purchasing an insurance plan,” the decision states. “Thus, the financing of health care services, and specifically the practice of self-insuring, is economic activity.”

More details to follow but neither side should read too much into this. We are likely to have courts ruling both ways until the case makes it to the US Supreme Court in 2012 or 2013.