Employee Benefits Compliance, Individual Mandate

Supreme Court Upholds the Individual Mandate

At 10:07 a.m., the US Supreme Court issued its decision.  In a 5-4 decision, the Court upheld the individual mandate, the requirement that most everyone obtain health insurance or pay a fee. Chief Justice Roberts joined the four liberal justices (Ginsberg, Kagan, Breyer and Sotomayor) and upheld the mandate under Congress’s taxing power. The court stated that individuals may choose not to comply, and if so, the federal government may properly impose a tax. The court did not uphold the law under the Commerce Clause power.The case is National Federation of Independent Business v Sebelius (case # 11-393).  Click here for a link to a 193-page pdf copy of the court’s decision. Other issues before the US Supreme Court in this case:

The Court didn’t have to reach the issue of severability because the individual mandate was found to be constitutional under the taxing power.  This means the court does not have to decide whether other provisions of the ACA are so “inextricably intertwined” with the individual mandate that they must also be stricken if the individual mandate is held unconstitutional.

Anti-injunction Act:
The Court found that the Anti-Injunction Act doesn’t apply, and therefore doesn’t prevent the court from hearing the issue on the individual mandate because the label “tax” is not controlling.  If the Anti-Injunction Act applied, it would have prevented the Court from hearing the case until 2015, when the tax would have been imposed on people who did not have health insurance.

Medicaid Expansion: 
The Court found that the Medicaid expansion is constitutional, but that the federal government cannot penalize a State by taking away its existing Medicaid funding if the State refuses to comply with the Medicaid expansion. 

Chief Justice Roberts was the key swing vote.

Some quotes from the opinion:“The individual mandate may be upheld as within Congress’s power under the Taxing Clause.”  Pp 33-44 of the opinion.“The Anti-Injunction Act does not bar this suit.”“The individual mandate is not a valid exercise of Congress’s power under the Commerce Clause and the Necessary and Proper Clause.  Pp. 16-30.”“The Medicaid expansion violates the Constitution by threatening States with the loss of their existing Medicaid funding if they decline to comply with the expansion.  Pp. 45-58.

Stay tuned for additional details!  The Leavitt Group will publish more Bulletins once we have had a chance to analyze the Supreme Court decision.

What’s Next?

No, the decision cannot be appealed.  There is no higher court to which one can appeal a Supreme Court decision.  And no one can go back to the Supreme Court next year asking that it reconsider its decision.

Yes, Congress could repeal the law.  Just because the Supreme Court says the law is not unconstitutional doesn’t mean it has to be in effect.  In fact, House Republicans have already announced they will have a vote July 9th to repeal the Affordable Care Act.  But Congress has shown its inability to enact laws in the past few years.  IF in November a Republican President is elected and the Republicans win control of Congress, then Congress might vote to repeal the Affordable Care Act. 

President Obama, in his first public statement after the Supreme Court issued its decision this morning, said “It’s time for us to move forward, to implement and where necessary to improve upon” the provisions in the Affordable Care Act.Romney said, in his first public statement this morning: “If we want to get rid of Obama care, we are going to have to replace President Obama.”

Information about the CaseThe case is National Federation of Independent Business v Sebelius (case # 11-393).  The link is: http://www.supremecourt.gov/opinions/11pdf/11-393c3a2.pdf )

Argued March 26, 27, 28, 2012—Decided June 28, 2012