Obamacare 3: An overview of Supreme Court’s decision

It’s been more than a week since the U.S. Supreme Court handed down its decision to uphold the Patient Protection and Affordable Care Act (ACA) and the nation is still talking about it.
In the weeks leading up to its decision, much speculation surrounded the court’s pending ruling, based largely on conservative justices’ harsh questioning of government attorneys during oral arguments in March.
That the court ruled as it did seemed to catch many off guard on both sides of the political spectrum – especially given that conservative Chief Justice John Roberts sided with the liberal minority in upholding the ACA and its central provision, the so-called “individual mandate.”
With Republicans expressing vehement dissatisfaction with Roberts and the court’s rulings, and vowing to dismantle and/or repeal the ACA, it’s not likely the discussion of one of the most closely watched cases in the Supreme Court’s recent history is going away any time soon.
With that in mind, here’s a summary of the ACA issues before the court and its rulings on each.
Overview of the issues
The court was asked to consider three main issues: The constitutionality of the individual mandate; whether or not parts of the law could be shot down without invalidating the rest of the law; and whether the government could compel states to expand their Medicaid programs.
First, the court had to determine whether or not it could consider individual mandate case at all.
• Issue 1: The applicability of the Anti-injunction Act
The court first heard arguments on whether the ACA challenges were prohibited under the Anti-injunction Act, a law that bars lawsuits challenging a tax law until after the tax goes into effect and is assessed.
Ruling: The court ruled that since the ACA called the consequences of individuals not buying health insurance in compliance with the individual mandate a “penalty” – and not a tax – the issue was not barred by the Anti-Injunction Act and could proceed.
• Issue 2: The constitutionality of the individual mandate requiring most Americans to purchase health insurance or pay a penalty beginning in 2014
Seen as the heart of the law, the individual mandate requires every nonexempt American to purchase health insurance by 2014 or pay an increasingly stiff penalty. The “shared responsibility payment,” as the ACA calls it, is to be collected by the IRS, along with the individual’s taxes.
Government lawyers argued primarily that the so-called penalty was a valid exercise of Congress’ powers to regulate interstate commerce between the states under the Constitution’s Commerce Clause.
Ruling: The court ultimately upheld the constitutionality of the individual mandate by a 5-4 vote, but it wasn’t pretty.
In its first ruling on the issue, the court’s five conservative justices – Roberts, Anthony Kennedy, Antonin Scalia, Clarence Thomas and Samuel Alito – ruled that the individual mandate was not constitutional under the Commerce Clause.
The ACA, they said, didn’t regulate commerce so much as it created commerce.
But then, in the ruling that sparked all the controversy, Roberts, as chief justice, ruled that while the individual mandate may not have been valid under the Commerce Clause, it was valid under Congress’ right to levy taxes.
The court’s four liberal justices – Ruth Bader Ginsberg, Stephen Breyer, Sonia Sotomayor and Elena Kagan – agreed; and with that, the 5-4 vote shifted, upholding the law’s central provision.
In his opinion, Roberts said that he was compelled, under court precedence, to consider the government’s alternative argument that the “shared responsibility payment” was, in essence, a tax.
“...Every reasonable construction must be resorted to, in order to save a statute from unconstitutionality,” Roberts wrote, citing Hooper v. California.
“The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax,” he wrote. “Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness.”
• Issue 3: The “severability” of the individual mandate
Originally intended to determine if the individual mandate could be “severed” from the rest of the law without invalidating the whole law, the issue of severability became a moot point after the ruling upholding the individual mandate.
• Issue 4: Whether Congress could force states to expand their Medicaid programs in keeping with the ACA, widely known as the “Medicaid coercion” issue.
The ACA wants states to expand their Medicaid programs to cover almost all residents under the age of 65 who cannot afford to buy health insurance.
While the federal government was to pay for the expansion, the ACA gave the government the power to withhold all Medicaid funding to states that refused or failed to do so.
Ruling: In a mixed decision, the court ruled that Congress could attach strings to federal money, but threatening to withhold all Medicaid funding from recalcitrant states went too far and was, therefore, unconstitutional.
On the other hand, the court also ruled that while the government must continue to pay state’s their traditional Medicaid funding, it could withhold the new Medicaid money intended to support Medicaid expansion under the ACA.