BREAKING NEWS: U.S. Supreme Court Upholds Affordable Care Act

Just after 10 a.m. on June 28, 2012, the U.S. Supreme Court handed down its opinion on the Affordable Care Act (ACA), ruling in a 5-4 decision that the law, including its mandate for the purchase of health insurance, was upheld.

Chief Justice Roberts concludes that the individual mandate is not a valid exercise of Congress’s power under the Commerce Clause of the U.S. Constitution; however, it was found to be within Congress’s power under the Taxing Clause (go here to read the opinion: http://www.supremecourt.gov/opinions/11pdf/11-393c3a2.pdf).

“The most straightforward reading of the individual mandate is that it commands individuals to purchase insurance. But, for the reasons explained, the Commerce Clause does not give Congress that power. It is therefore necessary to turn to the Government’s alternative argument: that the mandate may be upheld as within Congress’s power to ‘lay and collect Taxes,” the ruling states.

Individuals will not face negative legal consequences to not buying health insurance beyond requirement of paying that tax to the IRS, the decision further states.

Another key component of the ACA regarded the expansion of Medicaid, which the high court also found to be constitutional, outside of the federal government withholding funding for non-compliance with the expansion provisions.

"Nothing in our opinion precludes Congress from offering funds under the ACA to expand the availability of healthcare, and requiring that states accepting such funds comply with the conditions on their use. What Congress is not free to do is to penalize states that choose not to participate in that new program by taking away their existing Medicaid funding,” Roberts states.

SCOTUSblog, reporting minute-by-minute from the U.S. Supreme Court, offered the following synopsis by blogger Amy Howe:

"In Plain English: The Affordable Care Act, including its individual mandate that virtually all Americans buy health insurance, is constitutional. There were not five votes to uphold it on the ground that Congress could use its power to regulate commerce between the states to require everyone to buy health insurance. However, five Justices agreed that the penalty that someone must pay if he refuses to buy insurance is a kind of tax that Congress can impose using its taxing power. That is all that matters. Because the mandate survives, the Court did not need to decide what other parts of the statute were constitutional, except for a provision that required states to comply with new eligibility requirements for Medicaid or risk losing their funding. On that question, the Court held that the provision is constitutional as long as states would only lose new funds if they didn't comply with the new requirements, rather than all of their funding."

Watch for more coverage on how the decision will impact the healthcare design industry here at www.heatlhcaredesignmagazine.com.