Hot Topic: Supreme Court Upholds Health Care Law and the Individual Mandate

Hot Topic: Supreme Court Upholds Health Care Law and the Individual Mandate

Joel Cantor

Joel Cantor, director of the Center for State Health Policy

The Supreme Court
upheld the core of President Obama’s health care overhaul today ruling that the
government can require all Americans to obtain health insurance or pay a
penalty. The decision is an affirmation of the president’s signature
legislative achievement and should bring the country closer to providing
coverage for all its residents.  Joel C.
Cantor, director of Rutgers’ Center for State Health Policy, and Rutgers-Newark
law professor Christina Ho, a former Clinton health policy expert, explain the
significance of today’s decision, and what it could mean for individuals as
well as the continuing debate over health care.  

Rutgers Today: Can you explain the decision, which
components of the law were upheld and what the basis was for the ruling?

Cantor: All of the coverage provisions of the Affordable Health
Care Act were upheld, including the “minimum coverage requirement” (also known
as the individual mandate) and the Medicaid expansion.  The mandate, which
requires nearly all Americans to obtain insurance or pay a penalty, was upheld
under Congress’s taxing authority in the constitution. The Medicaid
expansion was deemed within Congress’s power to apply conditions to funds it
gives to states.  The court did limit the extent to which the federal
government can sanction states that do not expand Medicaid eligibility. 
Specifically, the federal government cannot cut off all Medicaid funding to a
non-complying state.  The federal government has never cut off a state and
it is exceedingly unlikely that it ever would, so the court’s ruling is largely

Ho: The decision was a surprise
because lower courts that had upheld the individual mandate did so under
Congress’s authority to regulate commerce and its authority under the ‘necessary
and proper’ clause that allows Congress to take the actions necessary to carry
out its powers. It was a surprise because no lower court had recognized Congress’s
taxing authority to uphold the mandate.

Rutgers Today: Gov. Christie had vetoed a bill to set up
health care exchanges that would establish a marketplace for individuals and
small business to obtain insurance with a tax credit from the federal
government, which is required under the law. What has to happen now in New

Cantor: In his veto message, Gov. Christie clearly stated that
if the law were upheld, New Jersey would move forward to implement its
responsibilities under the law.  He may elect to negotiate with the Legislature
to come to a meeting of the minds on the design of a New Jersey exchange or he
could issue an executive order creating the exchange. He has not signaled
what direction he would prefer.  

Christina Ho

Christina Ho, Rutgers-Newark Law professor


With the constitutionality of
the mandate resolved, we should call on Gov. Christie to get to work on
implementing the steps necessary for New Jerseyans to get coverage under the
health reform. 

Rutgers Today: What are the main components of the law? And how many people will it affect?

Cantor: We estimate that in 2014 about 444,000 uninsured in New
Jersey will gain health insurance because of the Affordable Care Act. 
This includes about 234,000 enrolling in Medicaid and the remainder enrolling
in private plans.  Those that are of modest means will be eligible for tax
credits to help them pay for their coverage.   The law also allows
young adults up to age 26 to enroll in a parent’s health plan; helps pay for
prescription drugs for Medicare beneficiaries in the so-called “doughnut hole”;
requires insurance plans to pay for certain preventive services, with no cost
sharing; guarantees that people can get coverage regardless of pre-existing
conditions; and addresses health-care quality and costs in various ways.

Rutgers Today: Can you explain the significance of the
provisions in the ruling that pertain to Medicaid?

Cantor: The Medicaid expansion will cover about 16 million very
low-income adults nationwide (about a quarter million in NJ).  In spite of
being very poor, Medicaid before the Affordable Health Care Act, typically did not
cover adults without children unless they are disabled so this is a very
significant expansion of the American health care safety net.  

Ho: This is my preliminary read. I don’t know if someone is
going to come along and say we are going to find some way to salvage this, but
I think there is a danger that a group of people who were intended to be
covered under the law might not be able to get coverage. The court said that
Congress couldn’t condition all of a state’s Medicaid funds on the addition of
newly eligible individuals. The decision today allows states to essentially
choose not to cover some of the people the law intended to cover. There could
be problems in states that elect not to cover these newly eligible individuals
because those low- income residents might not be eligible for other help under
the Affordable Care Act, such as the subsidies for purchasing coverage on the

Rutgers Today: Does this mean the legislation is secure? Is
it still vulnerable to appeal or to be unfunded by Republicans in Congress?

supreme court

U.S. Supreme Court Building


This legal challenge was probably the best opportunity
for the law’s opponents to undo the reform law, but there will be continuing
attempts to repeal it and challenge it in court.  Dismantling the law
will be difficult, however.  Many parts of the law are very popular,
including dependent coverage of young adults, prescription drug coverage for
seniors, and even the Medicaid eligibility expansion.  Moreover, insurance
companies, hospitals and other stakeholders are powerful forces to uphold the
law, and these groups have considerable influence with both political

Ho: I don’t think that this is the last we
will hear from the opponents of health reform. Republican leaders in the house
are still vowing to repeal and they will continue to undertake efforts to defund
or undermine implementation going forward and there are other lawsuits
challenging the law.

Rutgers Today: What do you see as the future for the law?
Do you think it will eventually become highly popular like other social safety
net programs?

Cantor: The mandate to buy coverage will probably always be
unpopular; but after it is implemented in 2014, most people will realize that
it has no practical impact on them and I believe opposition will ease. 
For example, about two-thirds of Americans have job-based
coverage, so they will meet the coverage requirement without having to do
anything.  Eventually the mandate will become like tobacco taxes – many
smokers oppose them but others either support them or have no opinion. 
Some very complex parts of the law, such as tax credits for private health
insurance, should become more popular as people come to understand how they

 Ho: I think our national conversation
on the health system is ongoing, and should be ongoing.  The health reform law, at least for now, is
not going to be prematurely undermined before we’ve had a chance to see how it
works.  Leaving the Affordable Care Act
intact gives us a broad platform to have that conversation. Now we can decide
we don’t like this or that aspect of it, but there is a platform to make
changes. That was the thing that we formerly lacked.

Media Contact: Andrea Alexander
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