The Issues & The Odds On the Supreme Court Decision on Health Care Reform

Executive Briefing | by | March 13, 2012

Monica E. Oss
Monica E. Oss

March 13, 2012

We’re only a few weeks away from the start of the Supreme Court arguments about the constitutionality of the Affordable Care Act (PPACA) . The issues and the timeline may seem a bit complicated, but there are really a few key elements that are key to changes in strategy regarding the legislation.

First, the issues. There are four different legal issues in front of the court. Each of these issues is related to how the PPACA proposes to achieve universal coverage for American citizens – through the expansion of the Medicaid program to individuals with incomes at 133% of poverty and through an “individual mandate” that requires most citizens with incomes above the threshold for filing federal income taxes to maintain health insurance or pay a financial penalty.

The four issues are related, as laid out in the great piece, Supreme Court Review of the Health Care Reform Law, in the February 29 issue of The New England Journal of Medicine.

  • Health care reform as a tax. The first issue is to determine if the individual mandate (IM) provision within the PPACA is a tax and whether the Tax Anti-Injunction Act (AIA) applies. The AIA states that the legality of a tax cannot be challenged until it has been assessed. In that case, all decisions would likely be postponed until after 2014.

  • Constitutionality of the individual mandate. If the PPACA is not found to be a tax and subject to review, the court will then consider whether Congress has the authority to require most U.S. citizens to purchase health insurance or pay a penalty – in other words, is the individual mandate legal.

  • Severability of the individual mandate. If the Court rules on the individual mandate and rules that the mandate is unconstitutional, the Court will then need to decide if the individual mandate is “severable.” In other words, will the rest of the PPACA legislation be constitutional. The government recognizes only two provisions of PPACA connected to the individual mandate – “the requirements that insurers cover people with preexisting conditions and not charge them higher premiums.”

  • Constitutionality of the Medicaid expansion. Finally, the Court will rule on whether states can be required to participate in the expansion of the Medicaid program and still be eligible for Federal Medicaid funds. Some States argue that this requirement exceeds Federal authority.

Then, we have the schedule. The arguments will take place March 26 to March 28 with a likely decision sometime in June. The court’s three-day schedule will cover:

  • Two hours about the constitutionality of the Individual Mandate (IM).

  • One hour about the constitutionality of the Medicaid coverage expansion.

  • One and a half hours on whether the Anti-Injunction Act prevents a challenge to the IM at this time.

  • One and a half hours on how much of the PPACA can remain if the IM is ruled unconstitutional.

For a more detailed look at the schedule, check out (see Showdown At The Supreme Court: Will Health Care Reform Stay Intact? ).

What are the odds of a particular decision on these issues? I just don’t know. I’ve learned never to bet on horses or lawyers. But, others aren’t quite so shy in making predictions:

Whatever the decisions, we’ll be there the next day to provide insights on what it means for your strategy.

Monica E. Oss
Chief Executive Officer, OPEN MINDS

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