      Constitutionality o f Subsection 4117(b) of Enrolled Bill
    H.R. 5835, the “Omnibus Budget Reconciliation Act of 1990”


T h e c o n d itio n s im p o s e d o n action b y th e S e c re ta ry o f H e a lth a n d H u m a n S e rv ic e s b y s u b s e c ­
     t i o n 4 1 1 7 ( b ) o f t h e O m n ib u s B u d g e t R e c o n c ilia tio n A c t o f 1 9 9 0 v io la te e i t h e r th e
     A p p o in tm e n ts C la u s e o r the b ic a m e r a lis m a n d p re s e n tm e n t re q u ire m e n ts o f th e C o n s titu ­
     tio n . T h e s u b se c tio n is also u n c o n stitu tio n a l in s o fa r as it a tte m p ts to c o n fe r fed eral la w m a k in g
     p o w e r o n S ta te o rg a n iz a tio n s. '


In th e e v e n t th a t th e P re sid e n t s ig n s th e bill in to la w , he m a y d ire c t th a t th e u n c o n stitu tio n a l
    c o n d itio n s im p o s e d b y su b se c tio n 4 1 17(b) b e g iv e n n o le g a l fo rce o r e ffe c t.


                                                                                                         November 5, 1990

             M e m o r a n d u m O p in io n f o r t h e C o u n s e l t o t h e P r e s id e n t



    This responds to your request for our advice concerning the constitution­
ality o f subsection 4117(b) o f enrolled bill H.R. 5835, the “Omnibus Budget
Reconciliation Act of 1990.” For the reasons set forth below, we believe
that the conditions imposed on action by the Secretary of Health and Human
Services in subsection 4117(b) violate either the Appointments Clause, U.S.
Const, art. II, § 2, cl. 2, or the bicameralism and presentment requirements
in Article I, Section 7 of the Constitution. We are further of the view that,
in the event that the President approves the bill, he may direct that the
requirements imposed by subsection 4117(b) be given no legal force or effect.
    Section 4117 provides in relevant part:

               (a)    In General. — Notwithstanding section 1848(j)(2) of
             the Social Security Act (42 U.S.C. 1395w-4(j)(2)) [which de­
             fines “fee schedule areafs]” in terms of “localities]”], in the
             case of the States of Nebraska and Oklahoma, if the respec­
             tive State meets the requirements specified in subsection (b)



  ' E d ito r’s N o te: T h e h o ld in g of this o p in io n relating to the A ppointm ents C la u se has been disavow ed.
See M em o ra n d u m fo r th e G eneral C o u n se ls o f the F ed eral G o vernm ent, from W alter D ellinger, A ssis­
ta n t A tto rn e y G e n eral, Re: The Constitutional Separation o f Powers between the President and Con­
gress, a t 20-21 n.53 (M ay 7, 1996).

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        on or before April 1, 1991, the Secretary of Health and Human
        Services . . . shall treat the State as a single fee schedule area
        for purposes of determining —

                  (1) the adjusted historical payment basis (as de­
                       fined in section 1848(a)(2)(D) of such Act
                       (42 U.S.C. 1395w-4(a)(2)(D))), and

                  (2) the fee schedule amount (as referred to in
                       section 1848(a) (42 U.S.C. 1395w-4(a)) of
                       such Act),

       for physicians’ services (as defined in section 1848(j)(3) of
       such Act (42 U.S.C. 1395w-4(j)(3))) furnished on or after Janu­
       ary 1, 1992.
         (b) Requirements. — The requirements specified in this sub­
       section are that (on or before April 1, 1991) there are written
       expressions of support for treatment of the State as a single
       fee schedule area (on a budget-neutral basis) from —

                  (1) each member of the congressional delega­
                      tion from the State, and

                  (2) organizations representing urban and rural
                      physicians in the State.

In effect, subsection 4117(b) grants “each member of the congressional del­
egation” from the States of Nebraska and Oklahoma and “organizations
representing urban and rural physicians in the State” the power to determine,
ab initio, whether “the Secretary of Health and Human Services . . . shall
treat the States as a single fee schedule area” for the purposes enumerated in
subsection 4117(a).
    In our view, the power to determine whether or not the Secretary shall
treat the States of Nebraska and Oklahoma as a single fee schedule area
clearly affects physicians’ “eligibility for funds” in those States, and there­
fore constitutes the exercise of “significant authority pursuant to the laws of
the United States,” Buckley v. Valeo, 424 U.S. 1, 126, 140 (1976). Such
authority must be exercised by persons appointed as Officers of the United
States in conformity with the Appointments Clause, U.S. Const, art. II, § 2,
cl. 2. Buckley, 424 U.S. at 140-41; see also Bowsher v. Synar, 478 U.S. 714,
726 (1986) (“The structure of the Constitution does not permit Congress to
execute the laws . . . .”). Since neither the members of State congressional
delegations nor “organizations representing urban and rural physicians in the

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State” are Officers o f the United States appointed consistent with Article II,
subsection 4 1 17(b) unconstitutionally delegates executive power to these en­
tities. Indeed, the members o f State congressional delegations could not be
appointed Officers of the United States without violating the Incompatibility
Clause, U.S. Const, art. I, § 6, cl. 2.
    Alternatively, by conditioning the Secretary’s action on the prior approval
o f certain members of Congress, subsection 4117(b) permits several Mem­
bers of Congress to take action that “alter[s] the legal rights, duties and
relations of persons” while evading the bicameralism and presentment re­
quirem ents in Article I, Section 7. INS v. Chadha, 462 U.S. 919, 952 (1983).
Statutory arrangements of this kind are clearly unconstitutional. Id. at 959.
Furthermore, subsection 4117(b) is unconstitutional insofar as it attempts to
confer lawmaking power on State organizations, because only Congress has
the authority to exercise the “ legislative Powers” of the federal government.
U.S. Const, art. I, § 1.
    At least in the context o f legislation that infringes upon the President’s
constitutional authority, and thereby violates the constitutional principle of
separate powers, the President may refuse to enforce unconstitutional re­
quirements. See Issues Raised by Foreign Relations Authorization Bill, 14
Op. O.L.C. 37, 50 (1990). Accordingly, we believe that, consistent with the
Constitution, the President may treat the unconstitutional condition in sub­
section 4 1 17(b) as having no legal force or effect.1

                                                                          J. MICHAEL LUTTIG
                                                                      Assistant Attorney General
                                                                       Office o f Legal Counsel




   ' G iv e n th e in v a lid ity o f subsection 4 1 17(b) o f the statu te, it w ill be n ecessary to d eterm ine w helher the
d ire c tio n to th e S e c re ta ry in subsection 4 1 17(a) is sev erab le from the u n constitutional condition. Alaska
A irlines, Inc. v. Brock, 4 8 0 U .S. 678, 6 8 4 -8 7 (1987).

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