MMS News & Events

Supreme Court Ruling and How it Affects Healthcare in Our Nation.

June 28th, 2012

On June 28, 2012, the Supreme Court of the United States of America voted in a 5 to 4 to uphold the Affordable Care Act passed by Congress in 2010. The most anticipated Supreme Court ruling in years, allows the government to continue implementing the health care law.

In the ruling, the high court decided the most controversial provision — the individual mandate requiring people to have health insurance — is valid as a tax, even though it is impermissible under the Constitution’s commerce clause.
“In this case, however, it is reasonable to construe what Congress has done as increasing taxes on those who have a certain amount of income, but choose to go without health insurance,” Chief Justice John Roberts wrote in the majority opinion. “Such legislation is within Congress’s power to tax.” He later added: “The federal government does not have the power to order people to buy health insurance. … The federal government does have the power to impose a tax on those without health insurance.”

Breaking down the decision

The uninsured

The decision leaves in place the so-called individual mandate — the requirement on Americans to have or buy health insurance beginning in 2014 or face a penalty — although many are exempt from that provision.
In 2014, the penalty will be $285 per family or 1% of income, whichever is greater. By 2016, it goes up to $2,085 per family or 2.5% of income.
Moreover, Health care exchanges, which are designed to offer cheaper health care plans, remain in place as well

The insured

Because the requirement remains for people to have or buy insurance, the revenue stream designed to help pay for the law remains in place. So insured Americans may be avoiding a spike in premiums that could have resulted if the high court had tossed out the individual mandate but left other requirements on insurers in place.

Young adults

Millions of young adults up to age 26 who have gained health insurance due to the law will be able to keep it. The law requires insurers to cover the children of those they insure up to age 26. About 2.5 million young adults from age 19 to 25 obtained health coverage as a result of the Affordable Care Act, according to the U.S. Department of Health and Human Services. Two of the nation’s largest insurers, United Healthcare and Humana, announced before the ruling they would have voluntarily maintain some aspects of health care reform, including coverage of adult dependents up to age 26, even if the law was scrapped.

People with pre-existing conditions

Since the law remains in place, the requirement that insurers cover people with pre-existing medical conditions remains active. The law also established that children under the age of 19 could no longer have limited benefits or be denied benefits because they had a pre-existing condition. Starting in 2014, the law makes it illegal for any health insurance plan to use pre-existing conditions to exclude, limit or set unrealistic rates on coverage.

Medicaid

The Supreme Court did rule that a part of the law involving Medicaid must change. The law calls for an expansion of eligibility for Medicaid

All tax-payers

The federal government is set to spend more than $1 trillion over the next decade to subsidize coverage and expand eligibility for Medicaid. The nonpartisan Congressional Budget Office estimated that the law could reduce deficits modestly in the first 10 years and then much more significantly in the second decade.

Meanwhile, the Flexible Spending Accounts that millions of Americans use to save money tax-free for medical expenses will be sliced under the law. FSAs often allow people to put aside up to $5,000 pre-tax; as of 2013, they were to face an annual limit of $2,500.

Small business owners

The rules and benefits small business owners face as a result of the health care law remain in place. As of 2014, under the law, small firms with more than 50 full-time employees would have to provide coverage or face expensive fines

All Americans, in lesser known ways

The massive health care law requires doctors to report goodies they get from medical supply companies; demands more breastfeeding rooms; requires all chain restaurants to list calories under every menu item, and includes numerous other provisions, which now remain in place.

What the justices wrote on their decision:

“The Federal Government does not have the power to order people to buy health insurance. Section 5000A would therefore be unconstitutional if read as a command. The Federal Government does have the power to impose a tax on those without health insurance. Section 5000A is therefore constitutional, because it can reasonably be read as a tax,” Chief Justice John Roberts

“Whether federal spending legislation crosses the line from enticement to coercion is often difficult to determine, and courts should not conclude that legislation is unconstitutional on this ground unless the coercive nature of an offer is unmistakably clear. In this case, however, there can be no doubt,” Justices Scalia, Kennedy, Thomas, and Alito

“The Framers created a Federal Government of limited powers, and assigned to this Court the duty of enforcing those limits. The Court does so today. But the Court does not express an opinion on the wisdom of the Affordable Care Act. Under the Constitution, that judgment is reserved to the people,” Chief Justice John Roberts

“The values that should have determined our course today are caution, minimalism, and the understanding that the Federal Government is one of limited powers. But the Court’s ruling undermines those values at every turn,” Justice Antonin Scalia

“Upholding the individual mandate under the Taxing Clause does not recognize any new federal power. It determines that Congress has used an existing one,” Chief Justice John Roberts

“Imposing a tax through judicial legislation inverts the constitutional scheme, and places the power to tax in the branch of government least accountable to the citizenry,” Justice Antonin Scalia

Reactions from politicians:

“The highest court in the land has now spoken. We’ll continue to implement this law and we’ll work together to improve on it where we can. But what we won’t do, what the country can’t afford to do, is refight the political battles of two years ago or go back to the way things were. With today’s announcement, it’s time for us to move forward,” President Barack Obama

“What the Court did not do on its last day in session, I will do on my first day if elected president of the United States, and that is, I will act to repeal Obamacare. Let’s make clear that we understand what the Court did and did not do. What the Court did today was say that Obamacare does not violate the Constitution. What they did not do was say that Obamacare is good law or that it’s good policy,” Mitt Romney, presumptive Republican presidential nominee

“The president’s health care law is hurting our economy by driving up health costs and making it harder for small businesses to hire. Today’s ruling underscores the urgency of repealing this harmful law in its entirety,” House Speaker John Boehner

“This decision is a victory for the American people. With this ruling, Americans will benefit from critical patient protections, lower costs for the middle class, more coverage for families, and greater accountability for the insurance industry,” House Minority Leader Nancy Pelosi

“Unfortunately Republicans in Congress continue to target the rights and benefits guaranteed under this law. They’d like to give the power back to the insurance companies, the power of life and death back to the insurance companies. But our Supreme Court has spoken. The matter is settled,” Senate Majority Leader Harry Reid

“Today’s decision makes one thing clear: Congress must act to repeal this misguided law. Obamacare has not only limited choices and increased health care costs for American families, it has made it harder for American businesses to hire,” Senate Minority Leader Mitch McConnell