US Supreme Court upholds health care law
The US Supreme Court today, in a 5-4 decision, upheld the controversial Affordable Care Act, commonly known as Obamacare, and specifically the individual mandate that requires that every American have health care coverage when the plan is fully implemented by 2015.
Governor Peter Shumlin said at a press conference in Montpelier, "This is a great day for Vermonters and a great day for Americans." Shumlin wants Vermont to go a step farther than the federal government and create a single-payer system in Vermont that would eliminate the role of health insurance companies.
The governor praised Vermont's congressional delegation and President Obama and said health care costs need to be controlled to grow jobs and economic opportunity. He said that Friday he will apply for $100 million to $118 million in federal dollars to develop the technological infrastructure so the state "can move as quickly as possible toward real health care reform."
Cheryl Hanna, Professor of Law at Vermont Law School, said in an email to Vermont Business Magazine:
"There are significant legal implications of the Supreme Court's decision. First, I think most legal scholars were surprised that Chief Justice Roberts joined the four more liberal justices in upholding the ACA. Many had thought that it would be Justice Kennedy, the usual swing voter, who would be the deciding voice. And just as importantly, the Chief Justice reframed the individual mandate as a tax, thereby relying on the Tax and Spend clause of the Constitution. We will, from now on, refer to the law as the "health care tax" since Roberts rejected the idea that is was actually a mandate. As a practical matter, I am reminded of Shakespeare's 'A rose by any other name would smell as sweet.' The decision allows the federal government to continue on the road to universal health coverage by requiring individuals to either have minimum coverage or pay the health care tax to the IRS. Call it a tax, call it a mandate: the outcome is the same.
"But no one should read Justice Roberts' opinion as in any way liberal or progressive. In the decision, he reaffirmed two important conservative principles. First, Congress is limited in its power under the Constitution and thus can only act relative to an enumerated power. Second, absent the IRS penalty, Roberts was clear that the law would be unconstitutional under the Commerce Clause, and in that sense, reaffirmed a vision of small government as limited in its powers. It is not clear the implications of these principles going forward, but I suspect we will see more dismantling of federal programs by the Roberts Court, not less, as the years go on.
"The other major issue in the case involved the Medicaid provision. Congress appropriated funds for states to expand Medicaid coverage, but said that if states did not do so, then they would lose all Medicaid funding. The Court rejected this idea and found that Congress went too far by coercing the states to expand coverage. States can lose the specific funds allocated for coverage if they decide not to expand their programs, but not every Medicaid penny the government gives them. This is the first time the Court has ever found a tax and spend provision coercive and limits Congress from over-using the powers of its purse. Again, we will have to see if this limited-powers-of-the-purse principle will have implications beyond the decision. I suspect that it will.
"In the meantime, however, the health care tax survives under the Constitution, and universal health care moves forward at the national level. Any change to that will have to come Congress now that the Court has spoken."
The National Federation of Independent Business (NFIB), a vocal and legal opponent of the ACA, said in a statement:
“While we are certainly disappointed, NFIB respects the decision to uphold the individual mandate by the Supreme Court. Clearly this mandate has now become a tax on all Americans and a broken campaign promise from President Obama not to raise taxes,” said Dan Danner, President and CEO of the National Federation of Independent Business. “We are concerned about the precedent that this will set in Congress’ ability to mandate other aspects of our lives, but we will move forward from today to continue to fight, harder than ever, for real health-care reform for our membership.
“Under PPACA, small-business owners are going to face an onslaught of taxes and mandates, resulting in job loss and closed businesses. We will continue to fight for the repeal of PPACA in the halls of Congress; only with PPACA’s full repeal will Congress have the ability to go back to the drawing board to craft real reform that makes reducing costs a number one priority. The power and control of health-care decisions should be in the hands of the consumer, not the government.”
NFIB Vermont State Director Shawn Shouldice said, “the ruling is especially disappointing to Vermont small businesses because it gives a green light to the controversial health care reform experiment to which the state is now committed.
“Individuals and small businesses who choose to offer coverage to their employees will be forced to purchase it from the government run Vermont Health Insurance Exchange with limited choice over insurance plans, benefits and out of pocket costs, said Shouldice. The Shumlin Administration has consistently touted the costs savings this reform will reap. Small businesses across Vermont will be watching closely as our policymakers continue to push their reform measure forward.”
“This day will go down in history as the day when Americans lost a part of their freedom – the freedom to choose what to buy with their own money.” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center.
Senator Patrick Leahy offered these remarks: “Today’s decision by the Supreme Court to uphold the Affordable Care Act is a win not only for the millions of Vermonters and other Americans who have long been victimized by a deeply flawed health care system, but for all Americans who will benefit as we continue to implement this landmark law.
“Over much of the last century, generation after generation has unsuccessfully grappled with how to answer complex and increasingly urgent questions about how to let every American have access to quality, affordable health insurance. Out of control costs were eating our economy alive and forcing many employers to drop insurance for their workers. The Affordable Care Act at last answered those questions. Though no bill is perfect, these are good reforms, long needed by the American people, by American businesses and by the American economy.
“The nation and every American household now would be best served if this historic decision puts an end to the years of partisan attacks and obstruction of efforts to help the millions of Americans who have fallen through the cracks, and millions more who worry with good reason that they may fall through the crack of our broken health insurance system. The Court has spared the American people a return to those decades of spiraling problems and uncertainty that reached into every American household.
“The Court’s decision reaffirms what I have believed since the Senate debated and passed this law: Congress has the power under the Constitution and the Court’s own, long-standing precedent to protect Americans from abuses by health insurers and to help give all Americans with access to affordable health care, including some of the most vulnerable among us like children and older Americans.
“In passing the Affordable Care Act, Congress built on the cornerstones of modern America like Social Security, Medicare and Medicaid, to strengthen the Nation’s social safety net and help protect hardworking Americans. I have served in the Senate for 37 years, through seven presidencies. I am one of the few people in the Senate today who can say that I served alongside representatives who voted to create our nation’s Social Security system, voted for the G.I. bill, passed the Voting Rights Act, and created Medicare, Medicaid, and Head Start. Congress has come together to refine the laws establishing these programs. We should similarly come together to further improve the Affordable Care Act where needed. It’s time to stop the political posturing. Congress works best for the American people when we are able to come together to solve national problems. America is stronger when we do.”
Senator Bernie Sanders sent this statement: “Today is a good day for millions of Americans who have pre-existing conditions who can no longer be rejected by insurance companies. It is a good day for families with children under 26 who can keep their children on their health insurance policies. It is a good day for women who can no longer be charged far higher premiums than men.
“It is a good day for 30 million uninsured Americans who will have access to healthcare. It is a good day for seniors who will continue to see their prescription drug costs go down as the so-called doughnut hole goes away. It is a good day for small businesses who simply cannot continue to afford the escalating costs of providing insurance for their employees. It is a good day for 20 million Americans who will soon be able to find access to community health centers.
“It is an especially good day for the state of Vermont, which stands to receive hundreds of millions of dollars in additional federal funds to help our state achieve universal health care.
“In my view, while the Affordable Care Act is an important step in the right direction and I am glad that the Supreme Court upheld it, we ultimately need to do better. If we are serious about providing high-quality, affordable healthcare as a right, not a privilege, the real solution to America’s health care crisis is a Medicare-for-all, single-payer system. Until then, we will remain the only major nation that does not provide health care for every man, woman and child as a right of citizenship.
“I am proud that Vermont is making steady progress toward implementing a single-payer system. I hope our state will be a model to show the rest of the nation how to provide better care at less cost to more people.”
Representative Peter Welch issued the below statement following the Supreme Court’s decision on the Affordable Care Act.
“This historic decision by the Supreme Court clears the way to get about the business of ensuring that every American finally has access to quality and affordable health care. The Affordable Care Act will remain the law of the land.
“Amidst the contentious national health care debate over the last two years, there has been widespread consensus on one thing: America’s health care system is broken. The only beneficiaries of the status quo are insurance companies and their executives. Working families need the peace of mind and that comes with quality and affordable health care coverage. And businesses need to compete in a global economy without the heavy burden of skyrocketing employee health care premiums.
“With this landmark decision now behind us, both parties should set political differences aside and make this law work for the American people. It won't be easy, but it's time to get back to work.”
MVP, a major health insurer in Vermont, said in a statement that it has been preparing for this decision, despite its reservations. The company said it has complied with the ACA and is actively moving forward with the next steps in the health care reform process, including preparing to sell individual market policies through the state health insurance exchanges in 2014.
The Court’s decision on the Medicaid expansion in general will not have an effect in the markets MVP serves — New Hampshire, New York and Vermont — which currently maintain Medicaid eligibility for the most part at thresholds that meet the ACA requirements.
“Now that the ACA has been upheld by the Court, it is time to continue the work of reforming the health care system. This includes addressing America’s real health care problem by introducing legislation to reduce the unsustainable increases in the cost of health care services and products,” said David Oliker, MVP’s President and CEO. “Some of the most promising ways to control costs are to incentivize providers for delivering quality outcomes in a cost efficient way, to promote the use of evidence-based medicine, and to encourage the meaningful use of Health Information Technology/Electronic Medical Records and e-prescribing.”
MVP said it supports many of the goals of the ACA, such as making sure all Americans have meaningful, affordable health coverage and access to high-quality health care. However, MVP has told policymakers throughout the process that there are parts of the ACA that will not work as designed.
Specifically, MVP states, the following aspects of the ACA should be reconsidered:
-The “Small-Business Health Insurance Tax” (HIT) should be repealed. It is counterproductive to the goals of health care reform as it will significantly increase the cost of health care. The Congressional Budget Office (CBO) estimates that the HIT will impose an $87 billion tax on health insurers from 2014 to 2019. The tax would likely have to be passed on to consumers and is estimated to cost families hundreds of extra dollars a year.
-The ACA also includes new taxes on pharmaceutical manufacturers and medical device manufacturers that will raise the cost of health care and health coverage for individuals, families and employers. New taxes, including HIT, will increase premiums by approximately five percent more than current cost trends in 2014 and will similarly increase costs in subsequent years.
-MVP is concerned about the impact of significant funding cuts to Medicare Advantage (MA) health benefit plans included in the ACA and believes MA program funding should be returned to pre-ACA levels. MA programs are working for consumers and the scheduled cuts equate to $145 billion nationally over the next 10 years. These funding cuts will likely force many older adults to face higher premiums and/or reduced benefits, particularly in later years when the funding cuts are fully phased in and have a devastating impact on older Americans around the country, including the more than 100,000 older adults MVP serves.
-The individual mandate is not strong enough to motivate everyone to have health insurance. The goal is not to punish people, but to create a market that works. Experts agree that the key to making premiums more affordable is to create a system in which everyone—young and old, healthy and ill—is effectively motivated to have coverage.
-The timeframe for building the exchanges and getting products approved for sale is very compressed. For consumers to be able to purchase insurance through the exchange in time for coverage to begin January 1, 2014, products would need to be approved and available for sale during the fall open enrollment period of 2013. The concept of this kind of individual market/small business market product comparison tool will help drive transparency and innovation in the industry, but there are a number of significant hurdles to getting it up and running according to the deadlines in the ACA.
“MVP is committed to continuing to work with policymakers on both sides of the aisle to address the problems of escalating health care costs and finding effective solutions that encourage universal coverage, promote affordability and improve consumers’ access to high-quality care,” Oliker said.
According to the governor's office, this is what Vermont will get as part of the ACA:
Vermont has received nearly $40 million to support efforts to implement critical health reforms in Vermont:
- $1 million in Planning Grants to support research and planning to build a better health insurance marketplace in Vermont;
- $18 million in Exchange Establishment Grants to help Vermont implement provisions of the Affordable Care Act;
- $5.3 million from the Prevention and Public Health Fund to support effective policies in Vermont to help Vermonters lead longer lives;
- $10.9 million to help create new health center sites in medically underserved areas, help health centers increase the number of patients served, and expand preventive and primary health care services. There are 57 existing community health centers in Vermont;
- $70,000 to support outreach to eligible Medicare beneficiaries about their benefits;
- $500,000 to support Aging and Disability Resource Centers;
- $286,7000 for Family-to-Family Health information Centers to support families with children with special needs;
- $1.6 million for Maternal, Infant and Early Childhood Home Visiting Programs to bring health professions to meet with at-risk families in their homes;
- $1.8 million from the Pregnancy Assistance Fund to provide a network of support services for pregnant and parenting tends and women.