The five people who filed the lawsuit in Washington in June 2010 argue that the government has no right to compel Americans to buy anything, and claim that they and their families could face combined tax penalties of more than $27,000 if they fail to obtain insurance. One of the plaintiffs has since been dropped from the case.
In February, U.S. District Judge Gladys Kessler ruled the mandate was lawful and dismissed their suit.
Silberman, an appointee of Republican President Ronald Reagan, voted with U.S. Circuit Judge Harry Edwards, an appointee of Democrat Jimmy Carter, to uphold the Patient Protection and Affordable Care Act act, rejecting arguments that Congress lacked the power to enact the legislation.
'Disproportionate Harm'
Agreeing with government lawyers, Silberman said the health-care market is unique in that "virtually everyone will enter or affect it and because the uninsured inflict a disproportionate harm on the rest of the market," when they require care.
U.S. Circuit Judge Brett Kavanaugh, a nominee of Republican President George W. Bush, said in a dissent that he doesn't think the courts have jurisdiction to hear the case.
Kavanaugh found the penalty for failure to obtain coverage, which will first be imposed in 2015, tantamount to a tax because it's to be paid when filing federal tax return.
In his 65-page dissent, he said federal law bars courts from considering pre-enforcement lawsuits challenging the collection of taxes.
"The tax penalty is the only sanction for failing to have health insurance," he wrote. "And the IRS - and only the IRS - may assess, collect, and enforce the tax penalty."
Accordingly, the appeals court should have rejected jurisdiction of the suit and returned the matter to the lower court with instructions that it be dismissed, Kavanaugh said.
Silberman said the law barring such suits restrains only the IRS's assessment and collection of taxes.