Obama’s health law upheld

High court saves it 5-4

President Barack Obama on Thursday called the Supreme Court’s decision a “victory for people all over this country.”
President Barack Obama on Thursday called the Supreme Court’s decision a “victory for people all over this country.”

— The Supreme Court on Thursday upheld the core of President Barack Obama’s health-care overhaul, preserving a law that would expand insurance to millions of people and transform an industry that makes up 18 percent of the nation’s economy.

The justices, voting 5-4, said Congress has the power to make Americans carry insurance or pay a penalty. That requirement is at the center of the law, which also forces insurers to cover people with pre-existing medical conditions. The court limited the law’s extension of the Medicaid program for the poor by saying the federal government can’t threaten to withhold existing funds from states that don’t fully comply.

Chief Justice John Roberts, appointed by President George W. Bush, joined four Democratic-selected justices to give Obama a majority on a law that has divided the country along ideological and partisan lines throughout the Obama presidency.

As a senator, Obama opposed Roberts’ 2005 nomination. The 57-year-old chief justice has been a leader of the court’s conservative wing on other issues.

http://www.arkansas…">Related Story

Roberts, writing for the court, said Congress had the authority to impose the insurance requirement under its power to levy taxes. “Because the Constitution permits such a tax, it is not our role to forbid it or to pass upon its wisdom or fairness,” he wrote.

The decision on the Patient Protection and Affordable Care Act is the climax to a legal fight that featured the longest high court 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.

Republican-appointed Justices Antonin Scalia, Anthony Kennedy, Clarence Thomas and Samuel Alito dissented, saying they would have struck down the entire statute.

“The fragmentation of power produced by the structure of our government is central to liberty, and when we destroy it, we place liberty at peril,” the dissenters wrote. “Today’s decision should have vindicated, should have taught, this truth; instead, our judgment today has disregarded it.”

Kennedy, frequently the swing vote, read from the bench that the dissenters viewed the law as “invalid in its entirety” and that the court’s interpretation “amounts to a vast judicial overreaching.”

Among the majority, Justices Ruth Bader Ginsburg and Sonia Sotomayor voted to uphold the entire statute. Justices Stephen Breyer and Elena Kagan agreed with Roberts in limiting the Medicaid expansion.

The justices rejected the argument that the Obama administration had pressed most vigorously in support of the law, that its individual mandate requiring nearly all Americans to obtain health insurance by 2014 was justified by Congress’ power to regulate interstate commerce. The vote was again 5-4, but here Roberts was joined by the court’s four more conservative members.

Kennedy and Ginsburg took the unusual step of reading summaries of their respective opinions from the bench. All told, the justices took more than an hour to announce the ruling before a packed courtroom that included members of Congress, retired Justice John Paul Stevens and Solicitor General Donald Verrilli, the Obama administration lawyer whose defense of the law during arguments drew criticism.

The dispute marked the first time the Supreme Court had considered a president’s defining legislative accomplishment in the middle of his re-election campaign. The court hadn’t taken up a law of comparable scope since the justices overturned part of the National Industrial Recovery Act in 1935 during President Franklin Roosevelt’s New Deal.

The law marks the biggest change to the U.S. health system since Medicare and Medicaid were established in 1965. It was designed to expand coverage to at least 30 million people - primarily by expanding Medicaid and setting up online markets where consumers can buy insurance - while controlling the soaring costs of health care.

Republicans, including presidential candidate Mitt Romney, have called for its repeal.

The law was challenged by 26 Republican-controlled states and a small-business trade group. They contended the measure exceeded Congress’ constitutional powers to regulate interstate commerce and impose taxes.

The challenge focused on the insurance mandate. The concept was championed by Republicans years ago as an alternative to Democratic proposals for a single, government-run health-insurance system.

Many conservatives considered the 2010 law’s mandate unconstitutional under the commerce clause, arguing that if the federal government could compel people to buy health insurance, it could compel them to buy almost anything - even broccoli, the archetypal example debated during the oral arguments three months ago.

Roberts accepted the Republicans’ commerce argument, while voting to uphold the mandate under Congress’ taxing power.

While the federal government “does not have the power to order people to buy health insurance,” Roberts wrote, “the federal government does have the power to impose a tax on those without health insurance.” The law “is therefore constitutional because it can reasonably be read as a tax.”

For an individual, the tax would start at $95 in 2015 and rise to $695 by 2016. Even at that rate, considerably less than the cost of insurance, it is expected to raise about $4 billion a year to help pay for health-care coverage.

Roberts said that for most Americans, the amount of the penalty will be far less than the cost of insurance.

“It may often be a reasonable financial decision to make the payment rather than purchase insurance,” he wrote. “Although the payment will raise considerable revenue, it is plainly designed to expand health insurance coverage. But taxes that seek to influence conduct are nothing new.”

The court’s four liberals made it clear that they disagreed with the view of Roberts on the commerce clause.

In a separate dissent from the bench, Ginsburg, speaking for herself and Breyer, Sotomayor and Kagan, said the court’s commerce clause ruling was “a stunning step back that should not have staying power.”

“In the end,” she said, summarizing her position, “the Affordable Care Act survives largely unscathed. But the court’s commerce and spending clause jurisprudence has been set awry.”

The Obama administration has argued that the mandate was necessary because it allowed other provisions of the health-care law to function: those overhauling the way insurance is sold and those preventing sick people from being denied or charged extra for insurance.

The mandate’s advocates said it was necessary to ensure that not only sick people but also healthy individuals would sign up for coverage, keeping insurance premiums more affordable. The law offers subsidies to poorer and middle-class households, varying with their incomes. It also provides subsidies to some businesses for insuring their workers.

The Medicaid expansion was designed to extend eligibility to those with incomes up to 138 percent of the federal poverty line. States that didn’t comply with the new expansion would have lost all or part of their federal Medicaid funds.

Roberts said Congress can require states to meet conditions to receive new Medicaid money, though it can’t take away existing funding. He said Medicaid spending accounts for more than 20 percent of the average state’s total budget, with the federal government covering at least half those costs.

“The financial ‘inducement’ Congress has chosen is much more than ‘relatively mild encouragement’ - it is a gun to the head,” Roberts wrote.

The threatened loss of so much federal money “is economic dragooning that leaves the states with no real option but to acquiesce in the Medicaid expansion,” the chief justice said. “A state could hardly anticipate that Congress’ reservation of the right to ‘alter’ or ‘amend’ the Medicaid program included the power to transform it so dramatically.”

Congress can offer money to the states to expand Medicaid and can attach conditions to such grants, Roberts said. But, he added, “What Congress is not free to do is to penalize states that choose not to participate in that new program by taking away their existing Medicaid funding.”

The ruling removes some of the uncertainty the health industry had faced about the future of government policy. By upholding the individual mandate, the court left intact a provision that will give insurers millions of relatively healthy, low-cost policyholders.

Other parts of the law will help the drug industry, including the Medicaid expansion and the system of online insurance markets that will make it easier for people to buy policies. Hospitals also may benefit from the expansion, as will insurers that focus on managing states’ Medicaid programs.

Some parts of the law have already gone into effect, including provisions that close a gap in prescription-drug coverage under Medicare, allow 2.5 million young adults to stay on their parents’ insurance until age 26, and provide free mammograms, colonoscopies and flu shots.

The health-care measure’s enactment in March 2010 marked the culmination of decades of efforts by Democrats and Republicans alike to put in place a universal health-care program. For Obama, congressional approval marked a victory that had eluded presidents from Harry Truman to Bill Clinton.

Passage in the Democratic controlled Congress came only after months of lobbying, deal-making and parliamentary maneuvering. In the end, not a single Republican voted in favor of the law. The measure passed the House 219-212.

From the beginning, the law divided the public, with opposition fueling the Tea Party movement and helping produce the 2010 Republican takeover of the House.

Rulings by appeals courts on the health-care law had split on the main questions, with two courts upholding the law, one striking down the mandate and another deferring consideration of the law until 2015, reasoning that the courts lacked jurisdiction until the first penalties enforcing the mandate came due.

Although many conservatives were stung that the law will stand, the high court’s ruling did have the potential to restrain Congress in the longer term. The restriction of the Medicaid expansion could limit the federal government’s ability to alter other federally financed state programs.

The commerce clause ruling revised the constitutional structure, handing a victory to conservative legal scholars who say Congress’ power to regulate interstate commerce must have defined limits. New challenges to federal laws on commerce clause grounds are likely to follow.

In the opinion, Roberts wrote that letting the law survive reflects “a general reticence to invalidate the acts of the nation’s elected leaders.”

“It is not our job to protect the people from the consequences of their political choices,” he wrote.

Information for this article was contributed by Greg Stohr, Bob Drummond, Steven Komarow and Kayla Bruun of Bloomberg News; by David Lauter of the Tribune Washington Bureau; and by Adam Liptak and John H. Cushman Jr. of The New York Times.

Front Section, Pages 1 on 06/29/2012

Upcoming Events