The Patient Protection and Affordable Care Act (P.L. 111-148), signed into law by President Barack Obama on March 23, 2010, and commonly referred to as health care reform, has been a flashpoint for controversy during and following its passage.  Threats of legal challenges to the law originated before Congress even voted on the bill, and lawsuits were filed almost immediately after the health care reform legislation became law.[1]  From March 26–March 28, 2012, the Supreme Court heard challenges to the constitutionality of the law brought forward by 26 state Attorneys General and the National Federation of Independent Business.[2]

 

On June 28, 2012, a 5–4 majority of the Court, in an opinion written by Chief Justice John Roberts, ruled that since the majority of the law was found constitutional, particularly the individual mandate provision, the law was upheld.  The Supreme Court’s ruling on this controversial program represents a huge victory for President Obama, as the law represents what many consider to be the President’s central legislative accomplishment thus far and “the largest new social program in a generation.”[3]  As a result of health care reform, tens of millions of Americans will likely be able to obtain medical insurance. 

 

Two provisions of the law drew the most heated debate—the “individual mandate,” which compels uninsured individuals to purchase health insurance or pay a penalty to the government, and the Medicaid expansion, which requires states to expand their Medicaid programs to cover all uninsured individuals who make less than 133% of the federal poverty line or lose all Medicaid payments from the federal government.  The four justices considered to be the most liberal on the court—Steven Breyer, Ruth Bader Ginsburg, Elena Kagan, and Sonia Sotomayor—joined the conservative Roberts in ruling that the individual mandate is constitutional.  In coming to that conclusion, they rejected the Obama administration’s primary argument that the government can force Americans to purchase goods and services pursuant to the Commerce Clause of the Constitution.  Rather, they ruled that the penalty required under the law is a tax, one that Congress is allowed to levy under its taxing powers.[4]

 

Regarding the Medicaid expansion, the Court held that the federal government cannot withhold all Medicaid payments from states that choose not to expand their programs by a vote of 7–2.  Three Republican governors—Republicans Nikki Haley of South Carolina, Bobby Jindal of Louisiana, and Rick Scott of Florida—have already vowed that their states will not participate in the Medicaid expansion when it goes into effect in 2014.[5]  Analyst Ezra Klein of the Washington Post, however, pointed out that unless Republicans win the Senate and the White House in 2012 and are able to repeal health care reform, even states with officials ideologically opposed to the law are likely to expand their Medicaid programs because the additional payments from the federal government will be too much money for them to turn down.[6]  Under the law, the federal government will pay 100% of the costs for the people newly eligible for Medicaid until 2017, and 90% of the costs thereafter.  Klein further opined that governors who reject the Medicaid expansion “also have to answer to non-Republican voters who don’t want their state missing out on billions in federal dollars, and to the hospitals in their state who have to treat uninsured patients that end up in their emergency rooms, and the insured voters who end up paying for their uninsured brethren.”[7] (For a complete look at how health care reform fared after the Supreme Court’s decision, click here.)

 

The Supreme Court’s decision, while a victory for the Obama administration, did nothing to silence the debate over health care reform.  President Obama hailed the decision as a “a victory for people all over this country whose lives will be more secure because of this law;” however, former Massachusetts governor Mitt Romney, the presumptive Republican presidential nominee, claimed that the health care reform law “was bad law yesterday [and is] bad law today” and vowed to repeal it.[8]  His Republican brethren echoed his sentiment, with Senate Minority Leader Mitch McConnell (R-KY) calling the decision “a fresh start on the road to repeal” and House Majority Leader Eric Cantor (R-VA) scheduling a vote on a repeal bill for the week of July 9th.  Given the substantial partisan divide over whether or not the law should be repealed, the ultimate fate of health care reform rests with the voters in November. 

 

Click here to view all July 2012 Policy Updates

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