### Constitutionality of 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 se d on action b y the S ecre ta ry o f H ealth and H um an S e rv ices by su b se c ­ tio n 4 1 1 7 ( b ) o f th e O m nibus 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 ith e r the A p p o in tm e n ts C la u se o r the b ic a m e ra lism a n d p re sen tm en t req u irem en ts o f th e C o n stitu ­ tio n . T h e su b se c tio n is also u n constitutional in so fa r as it a ttem p ts to c o n fe r federal law m aking p o w e r o n S ta te organizations. '

In th e e v e n t th a t th e President sig n s the bill in to law , he m ay direct th a t the u n co n stitu tio n al c o n d itio n s im p o se d b y subsection 4 1 17(b) be g iv en no legal force o r effect.

November 5, 1990

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

This responds to your request for our advice concerning the constitutionality of 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) ofthe Social Security Act (42 U.S.C. 1395w-4(j)(2)) [which defines “fee schedule areafs]” in terms of “localities]”], in thecase of the States of Nebraska and Oklahoma, if the respective State meets the requirements specified in subsection (b)

' E d ito r’s N ote: T he holding of this op in io n relating to the A ppointm ents C lause has been disavow ed. See M em orandum for the General C ounsels o f the Federal G overnm ent, from W alter D ellinger, A ssistan t A ttorney G eneral, Re: The Constitutional Separation o f Powers between the President and Congress, at 20-21 n.53 (M ay 7, 1996).
154on 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 defined 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) ofsuch Act (42 U.S.C. 1395w-4(j)(3))) furnished on or after January 1, 1992. (b) Requirements. — The requirements specified in this subsection 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 delegation 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 delegation” 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 areaclearly affects physicians’ “eligibility for funds” in those States, and therefore 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

155State” are Officers of the United States appointed consistent with Article II,

subsection 4 1 17(b) unconstitutionally delegates executive power to these entities. Indeed, the members of 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 approvalof certain members of Congress, subsection 4117(b) permits several Members of Congress to take action that “alter[s] the legal rights, duties andrelations of persons” while evading the bicameralism and presentment requirements 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 of legislation that infringes upon the President’s constitutional authority, and thereby violates the constitutional principle ofseparate powers, the President may refuse to enforce unconstitutional requirements. See Issues Raised by Foreign Relations Authorization Bill, 14 Op. O.L.C. 37, 50 (1990). Accordingly, we believe that, consistent with theConstitution, the President may treat the unconstitutional condition in subsection 4 1 17(b) as having no legal force or effect.1

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

' G iven the invalidity o f subsection 4 1 17(b) of the statute, it will be necessary to determ ine w helher the d irectio n to the S ecretary in subsection 4 1 17(a) is severable from the unconstitutional condition. Alaska Airlines, Inc. v. Brock, 480 U.S. 678, 684-87 (1987).
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