Key Provisions of the Affordable Care Act Upheld by U.S. Supreme Court

[author: Jeffrey Cairns]

            Last Thursday, June 28, in a 5-4 decision, the U.S. Supreme Court found that the Patient Protection and Affordable Care Act of 2010 (the “Affordable Care Act” or “Act”) is constitutional paving the way for final implementation of its provisions. While the Administration argued that the Act was a reasonable use of federal government powers under the Constitution’s Commerce Clause, Justice John Roberts, the author of the Majority Opinion, found that it was the Constitution’s taxing authority which paved the way for the individual mandate (the provision requiring most individuals to either obtain health insurance or pay a penalty to the Internal Revenue Service). The Court found that the Affordable Care Act was unconstitutional under the Commerce Clause, which may have longer reaching impact on future efforts by Congress to regulate economic activity on a national basis.

            The most significant provision of the Affordable Care Act that was struck down in the decision is the provision allowing the Department of Health and Human Services to withdraw federal Medicaid funding for those states which refuse to expand Medicaid eligibility to include certain low income adults without children. This provision may impact employers in states refusing to comply with the Medicaid expansion by expanding the number of employees who must be provided coverage under the employer sponsored group health plans or subsidized coverage through a health exchange.

            Angela Bohmann and I will be discussing the impact of the Court’s ruling on employer sponsored health plans in a webinar on July 18 jointly sponsored with the Minnesota Chamber of Commerce. The webinar is free to members of the Minnesota Chamber and clients of Leonard, Street and Deinard. There is an $89 webinar fee for other attendees. Interested persons can register on-line at

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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