NYAPRS: Ok, here’s my best attempt to explain yesterday’s court ruling on the Affordable Care Act (ACA), often known as Obamacare.
The ACA was developed to respond to common concerns that American’s current healthcare system is too costly, doesn’t do enough to promote healthy outcomes and the prevention of illnesses, that health insurance companies have been able to bar coverage to those with pre-existing conditions or to terminate insurance for those who develop chronic or costly conditions and that too many Americans who couldn’t afford or opted out of buying health insurance were either not getting any care or were going to emergency rooms and hospitals and getting costly care that was often eventually passed on to the taxpayers. Also, young people often were unable to find or afford insurance once they graduated school and were off their parents’ coverage.
While some advocated for a fix that involved putting all Americans into one improved health care plan (single payer approaches like expanding Medicare for all), the Obama Administration and Congress ultimately approved an ACA that worked to change the rules and incentives that drive how health insurance companies will work. The ACA corrects all the problems in my first paragraph. It also requires insurance companies to spend 80% of the premiums they charge on direct healthcare costs.
But in order to pay for including the uninsured and to retain younger people, the ACA mandated that all Americans have to get health insurance and pay into the costs so that health insurance companies have enough in premiums to cover the increased costs. Yesterday’s Supreme Court ruling upheld the mandate requiring all Americans to buy insurance, not based on the Constitution’s ‘commerce clause’ but on Congress’ power to tax, and to penalize those who don’t get insurance by taxing them.
The Court also ruled that the federal government couldn’t force states to expand their Medicaid programs to take in the uninsured by holding back the federal share of Medicaid they currently provide to states.
- House Republicans might well vote the law down but Senate Democrats will not go along and so the law will stand.
- This issue will clearly be taken to the public in the coming months leading up to the Presidential election. Obama supporters will run on the law and Romney supporters will pledge to repeal it.
- If the law holds, the fight for adoption of the Medicaid expansion will go to the states. States have that have opposed adopting the law and were part of the law suit that led to yesterday’s Court ruling include Alabama, Alaska, Arizona, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Louisiana, Maine, Michigan, Mississippi, Nebraska, Nevada, North Dakota, Ohio, Pennsylvania, South Carolina, South Dakota, Texas, Utah, Washington, Wisconsin and Wyoming.
A Look at the Ruling Upholding Obamacare
By Connie Cass, Associated Press June 28, 2012
The Supreme Court decision upholding President Barack Obama’s health care overhaul affects nearly every American, because the law itself is so vast. A look at what it does and what’s to come:
WHAT DOES THE RULING MEAN TO ME?
The law tells almost everyone they must have health coverage and guarantees it will be available even if you are already ill or need hugely expensive care. It helps lots of people, not just the poor but many upper-income families, as well, afford coverage. And it requires insurers to provide certain basic benefits - like free preventive care.
WHAT THE JUSTICES SAID
The high court upheld almost all of the law, including the most disputed part: the mandate that virtually all Americans have health insurance or pay a penalty. The court said that penalty is essentially a tax, and that’s why the government has the power to impose it.
The ruling limited the law’s plan to expand the Medicaid insurance program for the poor, a joint effort of the federal government and states. It says the U.S. government cannot withhold a state’s entire Medicaid allotment if it doesn’t participate in the expansion.
Chief Justice John Roberts sided with the court’s four liberal justices - Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan and Sonia Sotomayor - to form the 5-4 majority.
HUGE POLITICAL IMPACT
The court upheld Obama’s signature legislative achievement. Final word from the court amplifies the most polarizing issue of his re-election campaign against Republican Mitt Romney.
GOP lawmakers and Romney have promised to repeal the law if they are in power after the November election.
The 2010 health care law will keep taking effect. It’s expected to bring coverage to about 30 million uninsured people. Overall, more than 9 in 10 eligible Americans will be covered.
Some parts are already in effect: Young adults can stay on their parents’ insurance up to age 26. Insurers can’t deny coverage to children with health problems. Limits on how much policies will pay out to each person over a lifetime are eliminated. Hundreds of older people already are saving money through improved Medicare prescription benefits. And co-payments for preventive care for all ages have been eliminated.
Starting in 2014, almost everyone will be required to be insured or pay a penalty. There are subsidies to help people who can’t afford coverage. Most employers will face penalties if they don’t offer coverage for their workers. Newly created insurance markets will make it easier for individuals and small businesses to buy affordable coverage. And Medicaid will be expanded to cover more low-income people.
Medicaid Expansion: Many Could Be Left Out
By Tami Luhby @CNNMoney June 29, 2012
The Supreme Court rules that states can opt out of health care reform's Medicaid expansion provision.
NEW YORK (CNNMoney) -- The Supreme Court may have upheld health care reform, but the ruling has left many of the poorest Americans at risk of remaining uninsured.
Also upheld was a provision that expands Medicaid coverage to include all adults with annual incomes at or below 133% of the federal poverty level, which is currently $14,404 for an individual. The federal government will pick up the total cost of the expensive expansion for the first three years, after which the funding will phase down to 90%.
The expansion could reduce the number of uninsured adults with incomes under 133% of poverty by more than 11 million by 2019, according to a Kaiser Family Foundation estimate.
But here's the catch: The states can opt out of the Medicaid expansion program, since the court said the federal government can't penalize them by withholding all Medicaid funding. Instead, these states wouldn't get the additional Medicaid money to cover newly eligible enrollees.
And that could mean trouble for many poor adults who are not eligible for Medicaid under the current system but would have qualified under the expansion. (Read: Doctors may have to quit their practices)
It's not known how many states will participate in Medicaid expansion.
Some states have already gotten a jump start on implementing the law's provisions. Since 2010, eight states have received approval to enroll low-income adults into Medicaid, for instance.
However, officials in many states are staunchly opposed to the Affordable Care Act. Some 26 of them challenged the Medicaid expansion, among other provisions, in court.
Wisconsin Governor Scott Walker, for instance, said his state will not start implementing the law until after the November election in hopes that it will be repealed under a new administration.
Medicaid has become an increasingly costly burden for states, especially during the Great Recession, which sent enrollment soaring.
Some 62 million people are covered by the public health insurance program.
States got a temporary reprieve from the Obama administration's 2009stimulus program, which funneled billions of dollars to them to cover public health care costs. But state officials also reduced payments to providers and made other cuts in hopes of saving money.
Now, state officials will have to consider whether to participate in the expansion program, weighing the policy, political and fiscal implications, said Matt Salo, executive director of the National Association of Medicaid Directors.
In states that do opt out, those who are just above the poverty line will be able to buy private coverage through new insurance exchanges. The federal government will help them cover the cost.
"For the lower end of the income scale, the subsidies are very large," Salo said.
But those below the poverty line aren't eligible for the subsidies. So in the states that opt not to expand Medicaid, millions of poor adults will likely be left without insurance.
"There is a gap in coverage for very vulnerable, low income people," said Edwin Park, vice president for health policy at the left-leaning Center on Budget and Policy Priorities.
Some experts believe that states will come under tremendous pressure, particularly from medical providers, to participate in the expansion. That's because they currently have to care for the uninsured poor at their or the state's expense.
If states participate in the expansion program, the federal government will pick up nearly all of the tab. That's a powerful incentive, as is the additional economic impact from the additional federal spending, said Gary Claxton, director of the Health Care Marketplace Project at the Kaiser Family Foundation.
"Probably, at the end of the day, states will want to do it," he said.