Supreme Outcome

After more than a year of uncertainty, we finally have closure with regards to the most significant constitutional challenge to PPACA. Just in case you’ve been away from your television, radio and/or Internet source for the past few days, here is a quick recap of the ruling. The Supreme Court found, through a 5-4 decision, that the PPACA’s individual mandate is a tax and thereby constitutional. They also ruled on a 7-2 basis that while the law’s expansion of the Medicaid program is legal, the federal government may not withhold existing Medicaid program funds to states that decide not to expand their programs. This means that the entire measure stands as is, except that the federal government’s power to terminate states’ Medicaid funds has been reduced. For purposes of implementation, virtually all of the law and all resulting regulations and deadlines proceed as scheduled.

The nuanced content of the ruling surprised even the most seasoned of court-watchers. The court found that while the mandate is an overreach of Congress’s authority under the commerce clause, it is legal due to Congress’s power to tax. Or, in plain English, Congress can’t force you to eat broccoli, but it can tax or penalize you if you don’t eat it. The tax/penalty argument was downplayed in the Obama Administration’s oral arguments and briefs before the High Court and many in the Administration wanted to drop it from the government’s case entirely. But it was a point that Solicitor General Donald Verrilli insisted that the Administration keep making, even in a limited form. Verilli’s performance during the oral arguments was filled with hemming and hawing and widely panned, but ultimately he saved the day.

Another sleeper issue was the court’s ruling on the Medicaid expansion in the law. Many court watchers were shocked that the Justices even agreed to hear the Medicaid portion of the case, given though none of the lower courts had sided in the states favor on that issue, even on a partial basis. During the oral arguments, none of the Justices seemed particularly moved by the 26 states’ argument that the law’s massive expansion of Medicaid was an imposition. Justice Elena Kagan even scoffed at the argument that the Medicaid expansion would be “coercive” to the states, saying “It’s just a boatload of federal money to take and spend on poor people’s healthcare. It doesn’t sound very coercive to me.” Yet she and Justice Steven Breyer voted with Chief Justice Roberts and Justices Scalia, Alito, Thomas and Kennedy and found that the federal government may not penalize the states that refuse the expansion by withholding any of their existing Medicaid funds.

A final surprise was how the court came down in its vote. Conservative Chief Justice John Roberts broke with the other Republican-appointed justices to uphold the law. Perhaps more startling, was that Justice Anthony Kennedy, who is often cast as the court’s “swing voter,” not only stood with the other conservative Justices in calling for the whole law to be struck down, but he also authored their minority opinion and spoke for the minority when the ruling was announced.


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