SCOTUS: ‘Obamacare’ at a glance - | Lufkin and Nacogdoches, Texas

SCOTUS: ‘Obamacare’ at a glance

President Barack Obama, Vice President Joe Biden and senior staff members react as the House passes the healthcare reform bill, March 21, 2010. (Source: Pete Souza/White House) President Barack Obama, Vice President Joe Biden and senior staff members react as the House passes the healthcare reform bill, March 21, 2010. (Source: Pete Souza/White House)

WASHINGTON (RNN) - After more than six hours of debate last week, the opinion of the U.S. Supreme Court as to the constitutionality of the Affordable Care Act won't be known until late June.

On March 28, the highest court in the land heard three cases brought by representatives of the Department of Health and Human Services, 26 states, and by the National Federation of Independent Business.

The parties spent the most time devoted to the Act's contentious mandate for most Americans to acquire health insurance by 2014 or face a penalty.

The Supreme Court addressed three other key issues in the bill, which have been addressed at least in part in all 26 Act-related lawsuits to reach the federal courts.

On March 26, justices listened to arguments as to whether the penalty assessed for failure to acquire insurance was open to litigation.

On the last day of arguments, the Court heard arguments about whether the rest of the Act would fail if the insurance mandate was ruled unconstitutional, as well as whether the expansion of Medicaid to people within 133 percent of the poverty line was unfairly burdensome to the states.

Here is a brief look at the issues under consideration:

Can courts rule on the insurance mandate?

The Supreme Court first opened the floor for debate over whether the penalty taxpayers would face for failing to keep the minimum level of insurance coverage could face litigation.

According to the Anti-Injunction Act, which traces its history to 1867, parties can't sue the government to stop a tax before it's "harmed" someone.

The federal government initially categorized the Act's penalty as a tax law, which would bring it under the Anti-Injunction Act. District courts universally rejected this argument, and the Obama Administration abandoned it as cases were allowed to go further up the judicial ladder.

However, at the urging of the Obama Administration, the Supreme Court asked for debate on the issue.

Attorney Gregory G. Katsas, representing 26 states, argued that since the penalty was not explicitly named a tax, it did not qualify for protection under the Anti-Injunction Act. He also said that since the federal government dropped its position that the penalty fell under the Anti-Injunction clause, they no longer had standing to the claim.

Attorney Robert A. Long, appointed by the Supreme Court to argue on the government's behalf, told the justices the penalty functioned as a tax and did not need to be explicitly named as such to qualify for protection under the Anti-Injunction Act.

Does Congress have the power to make you buy insurance?

If the Supreme Court decides the penalty doesn't fall under the Anti-Injunction Act, the justices will have to rule on the constitutionality of the mandate.

Solicitor General Donald B. Verrilli, arguing on behalf of the federal government, said the provision was "necessary to carry into execution those insurance reforms [contained in the Act]," pointing to the guarantee of insurance despite a patient's medical history and a provision which would allow people to compare similar coverage plans by price.

Both are likely to collapse without the mandate.

Verrilli argued the provision would not make people who aren't in the healthcare market pay for services, since everyone needs healthcare at some point. People who don't have insurance still use services - the cost of which often gets passed to others in the market through higher premiums.

He also defended the provision's constitutionality, saying that the mandate was part of a comprehensive reform scheme, giving Congress the authority to enact it.

However, the justices seemed to be on the fence about whether they believed Verrilli's argument, often comparing the market to others, such as the market for burial services and the market for food.

"Everybody has to buy food … so you define the market as food," Justice Antonin Scalia said. "Everybody is in the market, therefore you can make people buy broccoli."

Justice Anthony M. Kennedy said that allowing the federal government to force people into buying healthcare would be "unprecedented, this is a step beyond what our cases have allowed."

Attorney Paul D. Clement, arguing on behalf of 26 states, said Congress had the power require Americans to pay for health services through insurance, but the timing the government chose was not.

"You could simply say, through some sort of mandate on the insurance companies … [that] people simply have to sign up [for insurance] at … the point of sale," Clement said.

He also argued that not everyone is in the market for health insurance, as some people prefer to pay out of pocket.

Justice Elena Kagen, however, seemed to agree with Verrilli that everyone is part of the health insurance market.

"You are entitled to healthcare when you go to an emergency room, when you go to a doctor, even if you can't pay for it," she said, adding that the purpose of health insurance was "to access healthcare."

Speaking on behalf of the NFIB, attorney Michael A. Carvin echoed Clement's view that Congress doesn't have the right to tell people to enter the insurance market.

Comparing the mandate to Social Security, Justice Ruth Bader Ginsburg didn't seem swayed by his argument.

"It seems to me, to try to get care for the ones who need it by having everyone in the pool but also trying to preserve a role for the private sector for the private insurers, there's something very odd about that," Ginsburg said. "That the government can take over the whole thing and we all say, 'Oh, yes, that's fine,' but if the government wants to preserve private insurers it can't do that."

Can the mandate be separated from the rest of the Act?

If the Supreme Court finds the mandate unconstitutional, it will next need to decide whether the rest of the nearly 3,000-page Act would have to fall with it.

On behalf of the same 26 states and the National Federation of Independent Business, Clement told the court it would, since the guarantee of insurance regardless of medical history and the community-based rating system for pricing insurance were intimately linked with the mandate.

If either were allowed to stand, "they would actually counteract Congress's basic goal of providing patient protection, but also affordable care," he said.

States that enacted similar provisions without mandatory insurance have seen insurers jack up prices or leave as the pool of insured people shrunk. The belief is that when people know they can get insurance whenever they need it, they are less likely to keep the coverage until they feel they need it.

Speaking for the federal government's position, attorney Edwin S. Kneedler argued that only the guarantee of insurance and the community rating system would have to fall if the minimum coverage provision were unconstitutional.

Kneedler pointed out that reversing the Act would kick 2.5 million people out of their plans - everyone who gained insurance after coverage was extended to dependants until they turn 26.

However, Scalia took issue with the idea of keeping the rest of the Act, asking, "When have we ever really struck down what was the main purpose of the Act, and left the rest in effect?"

Attorney H. Bartow Farr III was appointed by the Supreme Court to argue for keeping every provision except the insurance mandate. He found at least six other provisions in the bill that support lower insurance prices.

He also told the Court that the meaning of "essential" in the context of the Affordable Care Act was misused in arguments.

"The word 'essential' in the commerce Clause context doesn't have the colloquial meaning," he said. "In the Commerce Clause context, 'essential' effectively means useful."

Justice Stephen G. Breyer and Chief Justice John G. Roberts touched on parts of the Act that could easily survive without the insurance mandate, such as the requirement that restaurants have calorie counts of their most popular items and incentives to attract doctors and nurses to high-need areas.

Is the federal government being coercive with the expansion of Medicaid?

Finally, the court turned to the claim from 26 states that the Act's expansion of Medicaid is coercive.

Under the guidelines introduced in the bill, Medicaid will grow to cover anyone who makes within 133 percent or less of the federal poverty limit. Under today's guidelines, that would include an individual making $14,856 or less and a family four making $30,656 or less.

The federal government will pay for the costs of expansion the first three years after the program goes into effect, then 90 percent of costs each year after that.

Clement told the Court that Medicaid expansion was directly linked to the possibly unconstitutional mandatory insurance provision since the expansion is aimed at getting low-income individuals access to health care.

He also pointed to a letter from the Secretary of Arizona, who said that when the state tried to leave the Children's Health Improvement Program, they were told that they would risk losing all $7.8 billion of their Medicaid funds.

"Congress here made a distinct and conscious decision to tie the state's willingness to accept these new funds not just to the new funds, but to their entire participation in the state," Clement said.

However, Breyer argued that there were many other examples of bills that used "in the Secretary's [of the Department of Health and Human Services] discretion," the same phrasing in the Act.

"That doesn't mean the Secretary can do anything that he or she wants, but rather, they are limited to what is not arbitrary, capricious and abuse of discretion in interpreting statues," he said.

Ginsburg echoed Breyer, saying, "we have never had, in the history of this country or the Court, any federal program struck down because it was so good that it becomes coercive to be in it."

Meanwhile, Verrilli highlighted that Medicaid has expanded many times over the years and it has never been considered "coercive."

He also said 60 percent of current spending goes to programs that are in excess of federal minimums.

Copyright 2012 Raycom News Network. All rights reserved.

The ACA: At Issue (SIDEBAR)


The Anti-Injunction Act: Does the individual insurance mandate fall under the tax code? If it does, the Court can't rule on its constitutionality until after it has "harmed" someone. Any litigation before More>>

More on the ACA (Sidebar)


Documents for the ACA. More>>

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