Policy & Law

The Supreme Court Upholds the ACA, with a Caveat About the Medicaid Expansion

4 Mins read

Bottom line:  The individual mandate and all other provisions of the Accountable Care Act (with one exception, discussed below) were upheld by the Supremes, 5-4, as a tax, and not under the Commerce Clause (surprise!), with Chief Justice Roberts writing the majority opinion and the liberal wing of the court concurring (mostly).

Bottom line:  The individual mandate and all other provisions of the Accountable Care Act (with one exception, discussed below) were upheld by the Supremes, 5-4, as a tax, and not under the Commerce Clause (surprise!), with Chief Justice Roberts writing the majority opinion and the liberal wing of the court concurring (mostly).  The Medicaid expansion was upheld, but the provision that would have yanked all federal financial support for Medicaid programs in states that did not implement the Medicaid expansion as provided in the ACA was held unconstitutional.  Thus, a state may legally refuse to implement the Medicaid expansion provisions, and refuse the full coverage of that expense by the federales (all other Medicaid expenses are shared by state and feds).   

I highly recommend reading the opinions issued by the Supreme Court.  All of them. Especially the dissenting opinions. Dissents are fun to read because their authors have their eyes fixed on the future implications of the majority decision. In this case, for example, Justice Ginsburg articulates the reasons why the law should have been upheld based on the Commerce Clause, so that future cases may be decided, in part, based on her parsing of the arguments and precedents.  She sees the health care opinion as a deviation from a line of Commerce Clause cases (the wheat case and the medical marijuana case, most colorfully).  What makes them really, really fun to read, though, is the way they turn a knife in the majority’s gut — with a smile.  Subtle, but very cutting.  A lot of the old reductio ad absurdum.

A few examples, from Justice Ginsburg’s dissent (cites and quotes omitted for clarity; plain English translations offered for the nonlawyers, or others, who may not find these quite as amusing as I do):

The Chief Justice’s novel constraint on Congress’ commerce power gains no force from our precedent and for that reason alone warrants disapprobation.

The Chief is making stuff up, and needs to be smacked down.

When contemplated in its extreme, almost any power lookds dangerous. The commerce power, hypothetically, would enable Congress to prohibit the purchase and home production of of all meat, fish, and dairy goods, effectively compelling Americans to eat only vegetables. Yet no one would offer the hypothetical and unreal possibility of a vegetarian state as a credible reason to deny Congress the authority ever to ban the possession and sale of goods. The Chief Justice accepts just such specious logic when he cites the broccoli horrible as a reason to deny Congress the power to pass the individual mandate.

The Chief says “broccoli,” by which he means, we can’t uphold the health reform law under the commerce clause, because if we did, then Congress could turn this country into a vegetarian state and we couldn’t say boo. 

Under pre-ACA Medicaid, the Federal Govenrment pays up to 83% of the costs of coverage for current enrollees; under the ACA, the federal contribution starts at 100% and will eventually settle at 90%. Even if one agreed that a change of as little as 7 percentage points carries constitutional significance, is it not passing strange to suggest that the purported incursion on state sovereignty might have been averted, or at least mitigated, had Congress offered States less money to carry out the same obligations?

The Chief says Congress is messing with state sovereignty by paying states a higher percentage of Medicaid expansion costs than they get for existing Medicaid costs.

On this last point, it will be interesting to see if any states among the plaintiffs in the case continue to toe the line and refuse to implement the Medicaid expansion.

The dissent from the right offers some gems, too:

The Court regards its strained statutory interpretation as judicial modesty. It is not. It amounts instead to a vast judicial overreaching.  It creates a debilitated, inoperable version of health-care regulation that Congress did not enact and the public does not expect.  

The Court’s disposition, invented and atextual as it is, does not even have the merit of avoiding constitutional difficulties.  It creates them.

With this sort of language in a fractured 5-4 decision, the Chief has not done very much to restore our collective confidence in the Court, an issue with which he may be concerned.

The commentariat has been out in full force, but the bottom line is the same across the polictical spectrum: like it or not, the Court has spoken — perhaps more clearly than many had expected — and the spectre of the Supremes is now removed from the health care reform equation.  Atul Gawande celebrates the benefit to be realized by broader health insurance coverage by offering vignettes of the experience of uninsurance.  He then dips into social science and economic theory in order to articulate a clear warning about the complexities — health care is a “wicked problem” — and the partisan chest-thumping and saber-rattling ahead. Clearly, we need to move on.  For some that means that it’s time to get back to the work of implementing the law. (Here’s a handy-dandy health reform implementation timeline from the good folks at the Kaiser Family Foundation.)  For some that means let’s try to stop it, by any means necessary — a vote in the House on July 11, and perhaps dumping a beer on Chief Justice Roberts’ head(!) (Those wild and crazy congressional Republicans.)

There will no doubt be changes ahead, to account for economic and political realities after the election. Meanwhile, there’s lots to be done.

Per aspera, ad astra!

David Harlow
The Harlow Group LLC
Health Care Law and Consulting 

80 posts

About author
DAVID HARLOW is Principal of The Harlow Group LLC, a health care law and consulting firm based in the Hub of the Universe, Boston, MA. His thirty years’ experience in the public and private sectors affords him a unique perspective on legal, policy and business issues facing the health care community. David is adept at assisting clients in developing new paradigms for their business organizations, relationships and processes so as to maximize the realization of organizational goals in a highly regulated environment, in realms ranging from health data privacy and security to digital health strategy to physician-hospital relationships to the avoidance of fraud and abuse. He's been called "an expert on HIPAA and other health-related law issues [who] knows more than virtually anyone on those topics.” (Forbes.com.) His award-winning blog, HealthBlawg, is highly regarded in both the legal and health policy blogging worlds. David is a charter member of the external Advisory Board of the Mayo Clinic Social Media Network and has served as the Public Policy Chair of the Society for Participatory Medicine, on the Health Law Section Council of the Massachusetts Bar Association and on the Advisory Board of FierceHealthIT. He speaks regularly before health care and legal industry groups on business, policy and legal matters. You should follow him on Twitter.
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