Supreme Court Backs Much of Controversial Health Reform Law

Says requirement that most Americans must carry insurance is constitutional

Lisa EspositoKaren Pallarito

Lisa EspositoKaren Pallarito

Updated on June 28, 2012

THURSDAY, June 28, 2012 (HealthDay News) -- Surprising many legal scholars, the U.S. Supreme Court upheld on Thursday the constitutionality of most of the controversial health reform law that requires almost all Americans to have health insurance or pay a penalty in the form of a tax.

The Patient Protection and Affordable Care Act, the signature legislative achievement of President Barack Obama's administration, has been fiercely debated since its inception in March 2010. On one side of the argument have been many Democrats, who view the law as the first substantive legal attempt to greatly expand the number of insured Americans while improving health care and attempting to contain medical costs. On the other side have been many Republicans, who view the measure as an unprecedented intrusion into the private lives of citizens by telling them they have to buy a certain product -- in this case, health insurance.

Chief Justice John Roberts announced the court's complicated 5-to-4 decision that allows the law to proceed with its goal of covering more than 30 million uninsured Americans.

The Associated Press reported that the court did have some concerns with the law's expansion of Medicaid, the government-funded insurance program for low-income Americans. But the court said the expansion could go forward as long as the federal government doesn't threaten to withhold states' entire Medicaid allotment if they don't take part in the law's extension, the news service said.

The court's four liberal justices, Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan and Sonia Sotomayor, joined Roberts in the decision. Conservative justices Samuel Alito, Anthony Kennedy, Antonin Scalia and Clarence Thomas voted against the law.

The law set in motion a series of reforms designed to extend health coverage to more than 30 million uninsured Americans. It seeks to accomplish these goals in several ways. More lower-income people will be allowed to enroll in Medicaid, while other uninsured individuals can buy coverage through new state health insurance exchanges. Some people who buy coverage may qualify for tax credits.

The 2010 law's most controversial component -- and one of the key targets of the Supreme Court's scrutiny -- requires almost all Americans to maintain health insurance coverage or pay a penalty in the form of a tax.

The law also aims to improve the quality and efficiency of health care. For example, there are programs to improve care coordination and reduce fraud and abuse in Medicare, the government-run insurance program for older and disabled Americans.

A number of the law's most popular provisions are already in effect. For instance, parents in private insurance plans that offer dependent coverage can keep their adult children on the plan up to age 26. And most plans must now cover preventive health screenings, such as mammograms and colonoscopies, at no out-of-pocket cost to the patient.

Core elements of the law -- such as expanding Medicaid, establishing the state health insurance exchanges and requiring people to have coverage or pay a penalty, known as the "individual mandate" -- aren't scheduled to take effect until 2014.

Reaction to the court's decision was swift and divided.

Dr. Jeremy Lazarus, president of the American Medical Association, said his group "has long supported health insurance coverage for all, and we are pleased that this decision means millions of Americans can look forward to the coverage they need to get healthy and stay healthy.

"This decision protects important improvements, such as ending coverage denials due to pre-existing conditions and lifetime caps on insurance, and allowing the 2.5 million young adults up to age 26 who gained coverage under the law to stay on their parents' health insurance policies," Lazarus said in a news release. "The expanded health care coverage upheld by the Supreme Court will allow patients to see their doctors earlier rather than waiting for treatment until they are sicker and care is more expensive. The decision upholds funding for important research on the effectiveness of drugs and treatments and protects expanded coverage for prevention and wellness care, which has already benefited about 54 million Americans."

American Heart Association CEO Nancy Brown said the court's decision "will benefit America's heart health for decades to come. Questions about the Affordable Care Act's constitutionality have overshadowed the law's progress. With this ruling, that uncertainty has finally been put to rest.

"By upholding the law, the nation's highest court has sent a clear message that patients should be the first priority in an ever-changing health care arena. The court's action in support of the ACA helps remind us what's really important -- enabling all Americans to obtain affordable, quality health care," she said in a news release.

Democrats applauded the court's decision, while Republicans were disappointed.

At a midday press conference, President Obama, one of the law's architects who had succeeded with health care reform where predecessors as far back as Franklin Roosevelt had failed, said: "Today I am as confident as ever that when we look back five years from now, or 10 years from now, or 20 years from now, we will be better off because we had the courage to pass this law and keep moving forward."

Senate Majority Leader Harry Reid (D-Nev.) said in a speech on the Senate floor after the ruling: "No longer will Americans be a heart attack or a car crash away from bankruptcy. No longer will Americans live in fear of losing their health insurance because they lose their job," the Washington Post reported.

Congressional Republicans and GOP presidential challenger Mitt Romney have pledged to try to repeal the law after the November elections.

"What the court did not do in its last day in session, I will do on the first day as president of the United States. And that is, I will act to repeal 'Obamacare,'" Romney said after the decision was announced, ABC News reported.

Polls have shown that Americans remain sharply divided over the health care law. But a Harris Interactive/HealthDay poll in January found that an increasing number of Americans were slowly starting to embrace some key components of the legislation.

To be sure, Americans remain divided over the legislation, with slightly more than one-third (36 percent) of adults saying they wanted the law repealed and 21 percent saying they wanted it to remain as is. Another 25 percent said they'd like to see only certain elements of the law modified, the poll found.

"The public is still divided, mainly on partisan lines, as to whether to implement or repeal all, parts, or none of the health care reform bill," said Harris Poll Chairman Humphrey Taylor.

The poll found that support for the legislation broke down along party lines. Almost two-thirds of Republicans (63 percent) said they wanted the Patient Protection and Affordable Care Act repealed, compared to 9 percent of Democrats.

But while respondents were split about the law as a whole, many strongly supported key elements of the bill, with 71 percent of those polled now backing the provision that prevents insurance companies from denying coverage to those already sick, for example.

The notable exception remains the individual mandate [the requirement that all adults purchase health insurance], "which remains deeply unpopular," Taylor said.

In February 2011, the Congressional Budget Office estimated that savings from the Affordable Care Act would cut the federal deficit by $210 billion during the next decade.

The law's supporters argue that without the requirement that people have insurance coverage while they're healthy, there won't be enough money in the risk pool to pay to take care of them when the need for health care eventually -- and inevitably -- arises.

"If people don't feel like paying, then get sick and go to the emergency room or the hospital, those people's costs will be added on to our insurance bills as they are today, which makes it much more expensive," said John Rother, president of the National Coalition on Health Care, which works to achieve reform of the U.S. health-care system.

But opponents say that the cost-cutting provisions probably won't work.

Devon Herrick, a health economist at the free-market National Center for Policy Analysis, said the law set up a "slippery slope" that will increase costs, not lower them.

"If Congress and company have the legal authority to decide the minimum coverage you must have, all manner of lobbyists and special interests and providers for specific diseases will descend on Washington and state capitals, as they always have, to make sure that their respective services are covered by that mandate," Herrick said.

In the two years since its passage, the Affordable Care Act has been the target of multiple lawsuits, with a handful of cases working their way through the federal appellate court system before the Supreme Court heard oral arguments in March.

More information

The Kaiser Family Foundation has a primer on the Supreme Court's review of the health-care reform law.

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