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Posted on June 29, 2012

By a vote of 5-4, the Supreme Court ruled yesterday to uphold the Patient Protection and Affordable Care Act. In a massive 182-page opinion, Justices ruled the individual mandate to be constitutional pursuant to Congress’s ability to tax. However, the ruling also found that the mandate violated the Commerce Clause embedded in Article I, Section 8, Clause 3 of the Constitution.

“Our precedent demonstrates that Congress had the power to impose the exaction in Section 5000(a) under the taxing power, and that Section 5000(a) need not be read to do more than impose a tax. This is sufficient to sustain it,” as highlighted on Bloomberg’s SCOTUSblog coverage yesterday morning.

Chief Justice John Roberts joined the majority opinion of the court along with justices Ruth Bader Ginsburg, Sonia Sotomayor, Stephen Beyer, and Elena Kagan. Justices Antonin Scalia, Clarence Thomas, Anthony Kennedy, and Samuel Alito dissented.

“The Affordable Care Act is constitutional in part and unconstitutional in part,” wrote Roberts. “[The individual mandate] cannot be upheld as an exercise of Congress’s power under the commerce clause,” added Roberts, who clarified Congress cannot “order individuals to engage in it.”

Despite upholding the central tenet of the Patient Protection and Affordable Care Act, the Court did in fact modify one key provision of the law, ruling that “the federal government cannot withdraw existing Medicaid funding from states that decide not to participate in a broad expansion of Medicaid eligibility,” reports USA Today.

The individual mandate, long derided by critics as an overreach of federal powers since the law’s passage in 2010, is considered the law’s most controversial provision requiring all eligible citizens to purchase health insurance. Now, the law goes back to Congress where it will be re-assessed, debated and voted on.

“House Republicans said after the Supreme Court’s ruling upholding President Barack Obama’s health care law that they’ll vote to repeal it after Congress returns from its July Fourth recess,” reports POLITICO. “The House will vote to repeal the health care law — again — on July 11, the office of House Majority Leader Eric Cantor (R-Va.) said."

Reports Bloomberg: “The decision on the Patient Protection and Affordable Care Act is the climax to an epic legal fight that featured the longest courtroom arguments in 44 years, a record number of briefs and extraordinary public interest in a Supreme Court case. The case tested both the constitutional powers of Congress and the willingness of the Roberts court to overrule the other two branches of the federal government.”

In its review of the Affordable Care Act, the Supreme Court pondered four key questions:

  • Can Congress force citizens to purchase health insurance under the individual mandate?
  • If the mandate were to be rejected, would that strike down the entire law or just specific parts of it?
  • Is Medicaid expansion an unfair burden on states?
  • Can the Supreme Court review all of the above questions before the law takes effect?

Legal expert Tom Goldstein of SCOTUSblog concluded: “[T]he entire ACA is upheld, with the exception that the federal government’s power to terminate states’ Medicaid funds is narrowly read.”

“The court did substantially limit a major piece of the law, one that expanded Medicaid, the joint federal-state program that provides health care to poor and disabled people,” reports the New York Times. “Seven justices agreed that Congress had exceeded its constitutional authority by coercing states into participating in the expansion by threatening them with the loss of existing federal payments.”

Robert Alt and Nina Owcharenko at the Heritage Foundation’s Foundry Blog expressed alarm that the ruling had “seriously damaged the principle of limited government. Indeed, anyone who has any doubts about this need only read the Court’s suggestion that Congress could force Americans to buy energy efficient windows or pay a tax.”

In the meantime, the American public remains skeptical about the Affordable Care Act and even more nervous about the future of health care. A recent ABC News/Washington Post poll found that only “36 percent… express a favorable opinion of the health care law. But ratings of the health care system as it currently stands are about as weak, 39 percent favorable. That means that while the intended fix is unpopular, so is the status quo—leaving the public still in search of solutions,” writes polling expert Gary Langer of Langer Research Associates.

Join the discussion with other Health Action Network members on Facebook.

PPACA Awaits Court Ruling

Posted on June 25, 2012

In March 2012, the U.S. Supreme Court heard six hours of arguments about the legality of the Patient Protection and Affordable Care Act (PPACA), also known as the health care reform law. This is one of the most important cases heard by the Supreme Court in decades.

Since its passage in March of 2010, there have been a number of legal challenges to various provisions of the law. Several core disputes reached the Supreme Court, including:

  • Individual Insurance Mandate—PPACA requires most Americans to obtain health insurance or pay a tax penalty. The Court will determine if this mandate is permitted under the U.S. Constitution.
  • Authority of the Court—Under the 1867 Anti-Injunction Act, the challenge to the mandate may not be able to be reviewed until after the penalty tax is imposed in 2014.
  • Medicaid Expansion—The Court is considering whether Congress can impose an expansion of Medicaid onto the states.

The Supreme Court is also considering whether striking down one part of the law—such as the individual mandate—will nullify the entire law. This issue is known as “severability.”

Because PPACA will impact virtually every American, this case has enormous consequences. The ruling is due in late June 2012, and it could also impact November’s national elections.

Once the Court rules, the Health Action Network will provide an analysis of the ruling and what it means for market-based health care. To receive email updates, join the Network if you’re not a member already.

You can also follow the discussion on Facebook and Twitter.

PPACA Cost Estimates Soar

Posted on June 25, 2012

One of the most troubling aspects of the Patient Protection and Affordable Care Act (PPACA), also called “Obamacare,” is the rising cost estimates. By a very narrow margin, Congress passed a law using inaccurate cost estimates:

The “original” cost estimate: $940 billion over 10 years

The “new” cost estimate: $1.76 trillion over 10 years, according to the non-partisan Congressional Budget Office (CBO)

With this new figure, the CBO also estimates that health insurance costs to small businesses will increase, not decrease as promised. If small businesses across the country have higher costs, they’ll have fewer dollars to invest in jobs and new growth.

In general, there is also a cloudy picture of what is factored into estimates of health care reform costs. The original forecast, for instance, included Medicare cuts—which haven’t been made. If these cuts are made, they may be applied to the Medicare Hospital Insurance trust fund—not to health care reform.

The CBO also acknowledged that its earlier estimates failed to include billions for new administrative costs of the IRS and the Department of Health and Human Services.

For American citizens—and Members of Congress—to make informed decisions, dependable costs estimates are essential. Today, we have a stalled health reform policy, and we don’t know what it’s going to cost if it moves forward.

We need sensible, market-driven health care that does not undermine our nation’s economy. And to measure the impact on the economy, we need reliable cost estimates—not back-of-the-envelope calculations.

Stay tuned for more updates, and be sure to follow the discussion on Facebook and Twitter.

Lost Jobs + Increased Costs

Posted on June 25, 2012

Even though the Patient Protection and Affordable Care Act (PPACA) is being challenged in court, and even though its main provisions have yet to be implemented, we are already seeing some of the negative consequences.

American Families Pay More $$$

Remember when health care reform was supposed to make coverage affordable and accessible? So far, this isn’t happening. The average family is paying $2,400 more for health insurance premiums since 2009.

Job Cuts and Slowed Hiring

Increased household costs might not be as big of a problem if Americans were finding new jobs and increased salaries and benefits. But that isn’t happening. A few telling points…

  • The National Retail Federation says that the health reform law’s penalties on businesses “are affecting expansion, franchising, and hiring decisions” among the nation’s retailers. The NFIB also reports a significant elimination of employer health plans.
  • Director of the non-partisan Congressional Budget Office (CBO) Doug Elmendorf testified before the U.S. House Budget Committee that the health care law will result in approximately 800,000 fewer full-time jobs.
  • A chilling example: medical device maker Stryker Corporation says it will cut its workforce by 5% in response to new taxes under the health care reform law.

It would be great if we could wave a magic wand and make health care free and still maintain the quality of care we have come to depend on. But that wand doesn’t exist. Economically, the best way to control costs and improve quality is through competition. Unfortunately, this principal seems to have been overlooked in the rush to reform health care.

Chaotic Changes in the States

Posted on June 25, 2012

The majority of states have engaged in some form of litigation against the Patient Protection and Affordable Care Act (PPACA). While many have joined the effort to overturn the law at the U.S. Supreme Court, most are now moving forward with implementing components of the law. States have issued new regulations, passed new laws, or both to comply with PPACA.

But actions from one state to another vary widely. For instance, one of the cornerstones of the law is the creation of a state-based health insurance exchange marketplace, scheduled for launch in 2014. To date, only 28 states and the District of Columbia have taken steps to create their own exchanges. Those that fail to meet the deadline will have to cede their markets to the federal government.

Several states are showing their reluctance to implement provisions of the health reform law by refusing or returning federal grants to help fund mandates of the law. Texas, Kansas, Florida, Wisconsin, Ohio, and other states have all returned funds.

There is one state that is holding out on implementing any part of the law: Arizona has taken no action, and the federal government could take action to penalize the state or compel it to act.

If the Supreme Court rules that PPACA is unconstitutional, it remains unclear what will happen with the new state laws and regulations. This leaves American businesses and consumers uncertain what lies ahead for health care reform.