Health Care Reform Supreme Court Decision


This morning, in a 5-4 decision, the Supreme Court determined that the Patient Protection and Affordable Care Act is constitutional. The Supreme Court's decision upholds the constitutionality of two key provisions of health care reform -- the individual mandate and the Medicaid expansion. The individual mandate requires most Americans to maintain a “minimum essential” level of health insurance coverage beginning in 2014. The Medicaid expansion provision allows Congress to provide federal funds to states on the condition that states provide health care to all citizens whose income falls below a certain level.

The Supreme Court ruled that Congress has the authority to impose the health care individual mandate under its broad power to tax and concluded that it is within Congress’s power to collect a penalty or “tax” from those who do not purchase health insurance. Interestingly, the Supreme Court held that Congress did not have the authority to impose the health care individual mandate under the Commerce Clause, which was the basis of the government’s primary argument.

Although the Supreme Court upheld the Medicaid expansion, it limited Congress’s power to withhold Medicaid funds from the states. The Supreme Court held that Congress does not have the authority to withhold or revoke existing Medicaid funding if the state elects to not participate in expanding health care coverage to certain individuals.

As a result of today’s Supreme Court decision, health care reform and its various provisions remain in effect and must be implemented in the coming months and years.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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