U.S. Supreme Court to decide fate of healthcare overhaul law

Mar 30, 2012

The fate of President Barack Obama’s landmark healthcare law is now up to the U.S. Supreme Court. Justices are beginning to weigh the merits of an historic three days’ worth of testimony for and against the Affordable Care Act. Lynn Hatter reports Florida had a front-row seat to the proceedings, as the state led 25-others in challenging the law.

After more than two years, dozens of lower-court hearings and legal wrangling, the Florida-led challenge to the federal healthcare overhaul has reached its final destination: The U.S. Supreme Court:

 “We will hear argument this morning in case number 11-398. Department of Health and Human Services vs. Florida.”

Florida along with 25 other states and the National Federation of Independent Businesses aired their issues with the law before the U.S. Supreme Court in three days’ worth of arguments. Bill Herrle says the requirement that most Americans carry insurance or pay a fine is anti-competitive and has added uncertainty to the business climate.

 “We’re looking for a reset on the healthcare dialogue in this nation. And if we prevail in this case, we’ll go back to congress and say, here are some market-based reforms that we think will help small business owners and that we can support.”

And the states argue the mandate places a penalty on the act of simply being alive. After only the first day of hearings, Florida Attorney General Pam Bondi was feeling upbeat.

 “We all feel very positive with today’s hearing and we look forward to tomorrow arguing the mandate and on Wednesday, arguing the severability and the Medicaid expansion.”

The second day of arguments focused on the so-called individual mandate”…the requirement that most Americans carry insurance or pay a fine. One argument used to support the mandate is that Congress has the right to regulate commerce. And, since healthcare makes up about 1/6th of the nation’s economy, it falls within Congress’ authority. Justice Anthony Kennedy is considered to be one of the court’s swing votes. Here he is asking Solicitor General Donald Verrilli to justify the healthcare law under the U.S. Constitution’s Commerce Clause:

Justice Kennedy: “Can you create commerce in order to regulate it?”

Verrilli: “That's not what's going on here, Justice Kennedy, and we are not seeking to defend the law on that basis.  In this case, what is being regulated is the method of financing health, the purchase of health care.” 

On the third day, the court took up whether the healthcare overhaul law could survive without the mandate—a term called “severability”. Justices also took up whether the law’s Medicaid expansion is unfairly coercive. Under the Affordable Care Act, state would have to increase the number of people eligible for Medicaid. The federal government would pay 100-percent of the additional cost for the first three years, and then 90-percent of the costs for the extra people after that. In Florida, the move would put another 1.5-million people into Medicaid.  If states don’t comply they risk losing all of the federal funding for the program. It’s a tradeoff that Florida has long argued is coercive. In this exchange, Justice Elena Kagan, asks the state’s attorney Paul Clemente, what’s so coercive about the federal government picking up most of the bill for the Medicaid expansion?

Kagan: “Let me give you a hypothetical. Suppose I’m an employer, and I see someone I really like and I want to hire that person. And I’ll give you $10 million a year to come work for me. And the person says, ‘I’ve never been offered anywhere approaching $10 million a year, of course I’m going to say yes to that. Now, we would both agree that’s not coercive, right?”

Clemente: “Well, I guess I’d want to know where the money came from--” (laughs)…

Kagan: “Wow! Wow! I’m offering you $10 million a year to come work for me and you’re saying this is anything but a great choice?”

Florida says the cost of adding an additional million people to its Medicaid roll could come with a billion-plus dollar price tag.  But Greg Mellowe, the healthcare advocacy group Florida CHAIN, says the state’s estimates are overblown.

 “This is an expansion. But when the expansion only adds to the state’s burden by less than two-percent a year, that is something not out of control, and unmanageable. The benefits far outweigh the costs.”

Whether that’s true or not is under consideration by the U.S. Supreme Court. It’s every move is being watched for clues on how Justices will rule. Both sides may disagree on the merits of the law, but one area where there is common ground is on the impact the ruling will have. Florida Republican Representative Matt Hudson is strongly opposed to the healthcare overhaul. But he says however the court rules, it will be momentous.

“This decision that comes forward will be as landmark as Brown vs. The Board of Education as far as changing the fabric of our society.”

Justices have several options before them. The can refuse to rule on it—something court observers say is unlikely.

They can uphold the law in its entirety, or throw the whole thing out. Although, healthcare watchers like Families USA head Ron Pollack says, the latter option will be hard to do…

 “I think the people who have already tasted and felt how the Affordable Care Act affects their lives, those are not going to be happy campers if it’s repealed.”  

The court can choose to strike down parts of the law—such as the individual mandate or the Medicaid expansion—and let the rest stand. On Friday, the Justices met in a closed session for a preliminary vote on the law. But they won’t issue a ruling until late June.