The Supreme Court earlier today issued its long-awaited decision on the constitutionality of two aspects of the Patient Protection and Affordable Care Act, often referred to as the ACA or Obamacare. In a majority decision written by Chief Justice Roberts, the Court found that the provision in the ACA requiring individuals to purchase insurance or pay a penalty could be justified under the Constitution as tax.  A majority of the Court found that the mandate could not be justified as a legitimate exercise of Congressional power under the Commerce Clause. 

Seven members of the Court also found that the expansion of Medicaid to many new categories of beneficiaries, coupled with the threat of loss of all existing federal subsidies for current Medicaid benefits, was beyond Congress’ power, and hence unconstitutional. Three of those justices joined with the two justices who found the Medicaid expansion terms to be constitutional to find that simply eliminating the threat of loss of existing Medicare subsidies would correct the problem.  These five justices thus wrote out the ability of the administration to impose the penalty upon states who choose not to participate in the expansion.

The Court’s decision means that the ACA will take effect as scheduled, with the individual mandate, the employer mandate, community rating and Medicare cuts all intact.  In those states that elect not to participate in the Medicaid expansion, there will be potential problems.  The ACA has no backup mechanism for providing coverage for those who are eliglible by income for Medicaid, but who cannot get coverage due to a refusal of their state to participate.  This will leave them uninsured (and ineligible to participate in the Exchanges at subsidized premium rates.)  That means that providers may continue to have higher than expected uncompensated care, at the same time that their federal assistance to pay for uncompensated care is being cut.

In any case, the bottom line of the health insurance/health care market is that it was too expensive for consumers and employers before the ACA; the ACA did not do anywhere near enough to reduce the costs, or even to slow the increase in costs; and this decision does nothing to control costs, and may contribute to increasing them.  Just because the Supreme Court upheld most of the ACA, it does not mean that system is fixed.  Our nation still has much to do to create a sensible, affordable health care financing system, and it is long past time for our representatives to get busy on that project.

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Photo of Keith A. Ashmus Keith A. Ashmus

Designated Best Lawyers’ “2016 Lawyer of the Year” in Labor Law-Management in Cleveland and named to the Top 100 Ohio Super Lawyers, Keith is nationally recognized as a respected advocate and a trustworthy neutral. His practice focuses on employment law and business…

Designated Best Lawyers’ “2016 Lawyer of the Year” in Labor Law-Management in Cleveland and named to the Top 100 Ohio Super Lawyers, Keith is nationally recognized as a respected advocate and a trustworthy neutral. His practice focuses on employment law and business law, as well as mediation and arbitration cases around the nation. Keith is a Past President of the Ohio State Bar Association and a Past Chairman of both the Labor Law Section and the ADR Committee of the Cleveland Metropolitan Bar Association.

Keith is a recognized advocate for small business, having served as Chair of both the Council of Smaller Enterprises and the National Small Business Association. He has testified before the U.S. Senate and House of Representatives Committees, as well as the Ohio General Assembly, in support of small business positions.