Reacting to the Supreme Court's Affordable Care Act Decision
Earlier today, the Supreme Court finally ruled on the Affordable Care Act (ACA), upholding the vast majority of the law. The landmark 5-4 decision affirms the Affordable Care Act, President Obama's signature domestic act, with Chief Justice John Roberts wrote the majority opinion. The individual mandate for the purchase of health insurance was affirmed not under the Commerce Clause of the U.S. Constitution, but in the form of a tax, as the court ruled that the federal government cannot use the Commerce Clause to justify the individual mandate because the government cannot force people to purchase services. However, it sustained the mandate under the concept of its being a tax, as there is no criminal or civil penalty for not purachsing health insurance under the ACA. The court also ruled that the Medicaid expansion provided for in the ACA is constitutional, but that it would be unconstitutional for the federal government to withhold Medicaid funding for noncompliance with the expansion provisions.
While many groups have issued statements today on their opinions of the court's ruling, the effects of the decision will most certainly unfold over the coming months and years. As we've discussed in HEALTHCARE DESIGN several times over the last few years, many health systems have been in a holding pattern in the wake of healthcare reform, unwilling to commit to expensive large-scale building projects in a future that remained cloudy. According to McGraw-Hill Construction’s Dodge Project Center (as quoted by Architectural Record), healthcare construction starts have declined in recent years. After peaking at $30 billion in nationwide starts in 2008, the amount dipped to $24.4 billion in 2010 and $23.0 billion last year. Through May of this year, total starts (in square footage terms) were down 24 percent.
Sheila Cahnman, Group Vice President/Regional Healthcare Leader, HOK, Chicago, certainly thinks that trend is nearing an end, but not as soon as everyone would like. "The healthcare industry can now move ahead with far more certainty with one less 'ball in the air'," says Cahnman. "Health systems are still unsure of their projected revenues, but have already established that they are going to continue to decline, regardless of this ruling. In the short term, they will continue to push for improvements to lean operations to increase their bottom line. Hopefully with some more stability in financial outlook, they will start to address more infrastructure improvement issues including aging chassis that do not support lean operations or improved patient satisfaction. Long term, we will continue to see more development of ambulatory care facilities that support an accountable care mission of reaching patients early and easily. Public hospitals will need to improve their facilities to become more competitive in the market place. The new market realities will continue to require healthcare designers to do more with less, just like our clients."
David Allison, FAIA, FACHA, Professor of Architecture and the Director of Graduate Studies in Architecture + Health, Clemson University, still sees some big question marks on the horizon, however. "In the long run, it will hopefully be better for healthcare than the status quo, which was certainly unsustainable," says Allison. "I am unclear how this ruling impacts the healthcare design community in the short term beyond creating some stability for the context under which healthcare providers will operate, allowing them to move forward on capital investments that have been on hold due to uncertainty. That may not materialize though given the politicalization of healthcare and the upcoming elections."
While Allison also sees further uncertainty in the future, he does feel that as far as the U.S. healthcare system "reforming" itself, the horse was already out of the barn: "In the long term, I am not sure how this impacts healthcare design significantly more than other forces of change occurring in healthcare. As I see it, we will still have a relatively privatized industry. The industry must change no matter what, with or without this ruling, and is [changing], as the current models are indeed unsustainable. The forces driving safety, efficiency, efficacy, a broader understanding of health and healthy environments, patient satisfaction, and rapid changes will be impacting healthcare and healthcare design irrespective of this ruling."
Healthcare futurist Joe Flower, a Board Member of The Center for Health Design, is in the business of predicting the future, and as such, speaks with some certainty. "The principal effects of the finding, from the point of view of the system: They have just avoided enormous chaos over the coming years," Flower explains. "The system is chaotic enough already, at a tipping point into an unclear future, with the huge shift in underlying economic factors. These factors include especially the various ways of shifting some economic risk from the payers and employers to the providers and the patients/customers. The Supreme Court finding stabilizes the future of the system. The affirmation, combined with the fact that a gridlocked polity in Washington is unlikely to come up with any major change or repeal of the law, and that the major parts of the law are self-funding, means that everyone now knows at least the general outline of what the rules are for the foreseeable future."
Unlike Allison, however, Flower doesn't think there is a chance that this will all be undone after the November elections. "The law is now likely permanent. To overturn it, you would need President Romney with a filibuster-proof majority in the Senate and a majority in the House," says Flower. "By 2016, most people will have experienced the results of the law, and found its benefits far outweigh its costs. Business owners will find that it is not as burdensome as some have feared. It will have become obvious that the experience of the actual law is far different and more benign than the fears that have been drummed up about it politically. Once people experience its benefits for themselves, it will be very hard to gin up a campaign to take it away from them."
As the author of Healthcare Beyond Reform: Doing It Right For Half The Cost, Flower clearly has a vision of what is to come and how to get there. Flower is similarly optimistic as for the effects on the healthcare design community. "Many healthcare executives and boards have been stalling on strategic decisions until after today," states Flower. "Many assumed that the decision would be either completely negative or quite messy, and that it would take some time for things to settle out before they could make good decisions. That need for caution has disappeared, replaced by an urgency to move forward, combined with an uncertainty about exactly what the law will mean in their markets and sectors. There is and will be a great demand to help them interpret how this law affects them, and what they must do to thrive under it, from the revenue streams to the systems redesign to the physical environment."
preters, it would seem, are the healthcare designers and planners who have been now been thrust into a position of power; the healthcare design community can absolutely help shape the future of healthcare in the United States. It's up to them to seize the opportunity, because the Supreme Court has now done most of the heavy lifting for them.
Watch for ongoing coverage on how the decision will impact the healthcare design industry here at www.heatlhcaredesignmagazine.com.