Court Upholds Individual Mandate in the Affordable Care Act

Posted July, 18 2011 by arianne

Guest Blogger: Bob Cohen, Esq.; Policy Director, Citizen Action of New York

In an important legal victory for health care reform, the U.S. Court of Appeals for the Sixth Circuit recently ruled that the “minimum coverage” provision of the Affordable Care Act – the mandate that all Americans have health insurance by 2014 or face a federal tax penalty – is constitutional.  The June 29, 2011 decision – the first by a court of appeals (the intermediate level just below the Supreme Court) – convincingly rejected the arguments by the plaintiffs, the right-wing Thomas Moore Legal Center. 

The Court rejected the narrow technical legal argument that the minimum coverage provision penalizes non-activity – the decision not to purchase health coverage – and is therefore beyond the power of Congress under the Commerce Clause of the U.S. Constitution, which gives Congress the power to regulate commerce between the states. 

Instead, the Court explained that Congress “was concerned that individuals maintain minimum coverage not as an end in itself, but because of the economic implications on the broader health care market.”  Basically, everyone uses health care services at some point at some point in their lifetimes.  People pay for these health care costs either by buying health insurance, or by paying out-of-pocket they get sick or injured.  And, a large percentage of health care costs for the uninsured is borne by society as a whole, as laws require hospitals and clinics to provide services regardless of patients’ ability to pay for them.   

The Court reasoned that the decision not to buy health insurance has huge impacts on the overall health insurance market, as the cost of uncompensated care is passed on from providers to private insurers, which in turn pass on the costs to people with insurance in the form of higher health insurance premiums.  “Rising premiums push even more individuals out of the health insurance market, further increasing the cost of health insurance and perpetuating the cycle,” the decision said.

Given that this is the first decision on the minimum coverage provision of a federal appellate court and that one of the judges in the majority was a George W. Bush appointee, there is reason to be hopeful that the U.S. Supreme Court will uphold it.  But the decision is just as important for its political implications. 

Some politicians and reform opponents in New York and elsewhere have suggested that it makes no sense to implement the law because it will eventually be thrown out anyway by the courts.  Now we have an even stronger answer to this smokescreen – the courts have said the law is constitutional – so let’s get on with implementing it so that millions more will no longer face the crushing burden of high health care bills.

Click here for the full court opinion: