I have previously argued that the Congress has the power under the commerce clause to require individuals to buy health insurance, and that power is unmistakably clear under current doctrine despite the partisan decisions of some Republican judges to the contrary. See here. It is also even more obvious that people have no independent constitutional right to refuse to buy insurance. They also can be compelled to pay dues for the collective bargaining of unions, and they can be prevented from engaging in the inaction of secondary boycotts.
Nonetheless, I think the Democrats made a major error in the drafting of the health care law. The law provides that a person who does not buy health insurance must pay a $695 penalty. It would have been immensely better if the law had been crafted to provide a choice either buy insurance or pay a tax of $695. Why? Congress has the power to tax, but in theory, but not generally in practice, it may not impose a penalty in the form of a tax. In this circumstance the able bodied need to provide support for the health care system and they can do it either way. The $695 exaction is really not a penalty for failing to buy insurance; it is a source of funding for the health care bill. If the Democrats had called the $695 exaction a tax, it should and I believe would have been clear sailing. But the law calls the exaction a penalty. It is harder to deny the exaction is a penalty when it is labeled a penalty. In fairness, the law characterizes the exaction as a tax in many spots, and Congress need not call an exaction a tax in order to claim the taxing power in litigation (see here), but the word "penalty" should never have appeared in black and white.
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