Surprising Supreme Court decision leaves many confused about health care

The topic of health care elicits a strong response. Not having health care when you need it can be terrifying. Paying for it when you don’t, infuriating. But there is one topic that can elicit an even stronger response – taxes. On Thursday, those two topics crashed into one another as the Supreme Court handed down its decision on the Affordable Care Act.

In a move that seemed to astonish most people, the Supreme Court ruled that the much debated individual mandate of the ACA – the provision that requires every individual to acquire health insurance and charges a fee to those who don’t – was constitutional as a tax.

Prior to the Supreme Court ruling, the penalty for violating the individual mandate was deemed “not a tax.” Had it been identified as a tax, the Supreme Court under the Anti-Injunction Act could not have ruled on its constitutionality.

According to Patrick Ishmael, a policy analyst with the Show-Me Institute, the Anti-Injunction Act bars the court from ruling on a tax until after its implementation – and the individual mandate penalty will not be implemented until 2014.

So, going into the ruling the mandate penalty was not a tax – even President Obama declared in 2009 that the mandate penalty was not a tax – but coming out of court it was. What’s more it was declared constitutional under the legislative branch’s power to impose taxes.

“What happened is that the language changed,” Ishmael said.

Sen. Jane Cunningham (R-Chesterfield), put it another way. “The power of Congress is now unlimited through the unprecedented broad expansion of taxation after the President promised us this was not a tax. All they (the Supreme Court) did was switch authority from the Department of Commerce to the IRS.”

Whatever language you choose to use, the bottom line is still the same: choose to forgo health insurance and you will pay a fine, tax or penalty.

It is not considered to be a punitive tax, because the tax is expected to be less than the cost of health insurance.

Local reaction on Thursday in the Chesterfield Valley was as individual as the mandate.

Pat Dubuque, of Ellisville, declared, “What a horrible decision. If he [Obama] gets elected again, God help us. I won’t vote for him this time. They’re all crooks.”

In contrast, Jason Murphey, of University City, said, “I think it’s an excellent step toward what could potentially be great news for this country. It has its flaws, but I think it’s a great step in the right direction because something needs to be done.”

And taking the middle line, Cristine Handel, of Chesterfield, said, “I don’t agree or disagree with the whole decision. It’s a tough decision to make, and I don’t think it’s necessarily a yes or no answer. But we have a long way to go either way.”

Most political and health care analysts agree with Handel, at least in regard to having a long way to go.

“I think we may still see a silver lining in this,” Ishmael said.

On the Show-Me Daily blog, he wrote: “It is difficult to understate the importance of this ruling, now and for the future. In the short term, the core of the ACA stands, meaning Americans will still be subjected to one of the most coercive and leviathan government programs enacted in recent memory. Tens of millions will likely lose their current insurance plans, and young people will be especially affected by the law’s provisions. But the Court has also found that the mandate is a tax, meaning that repeal of the law could be as easy as passing a budget bill without the mandate, or the law, in it.”

Talking about the law’s effect on young people brings up the topic of affordability, a key component of the ACA.

“Affordability is second to access,” Ishmael said, adding, “and we’re still disconnected from health care costs.

“For young people it becomes less affordable because they may not need health insurance. It may be more affordable for them to pay for care as they need it rather than purchase health insurance. However, they are brought into the system to pay for individuals who do need care.”

It is estimated that more than 50 million people are uninsured.

Proponents of the ACA praise its promise of guaranteed coverage and subsidies for eligible lower-income and middle-class families.

Those provisions are set to begin in 2014. At the same time, insurance companies will not be able to deny coverage for medical treatment, nor can they charge more to people with health problems.

Proponents also expect seniors to benefit from the law, touting better Medicare coverage for those with high prescription costs, and no co-payments for preventive care.

But opponents, such as Sen. Cunningham, point to projections, such as a recent study by a trustee on the Medicare Board that “estimates a cost for the president’s health care law of $1.15 trillion over the next decade with a projected $530 billion added to the federal deficits while robbing $500 billion from the Medicare trust fund.”

How the needs of the uninsured are met raises yet another hot topic, namely the expansion of state Medicaid programs.

The ACA sought to expand Medicaid to cover individuals not currently covered – those who do not qualify for Medicaid under existing provisions, but who also do not earn enough to buy into a subsidized health care plan.

Individuals who generally qualify for Medicaid under the current provisions are low-income people, primarily parents with children, pregnant women, people with severe disabilities and senior citizens.

As part of its June 28 decision, the court ruled that the federal government can’t force states to expand Medicaid by threatening to take away the federal dollars they already receive.

Proponents of the ACA said that this decision could leave America’s most vulnerable citizens at risk. But opponents of the ACA, such as Missouri gubernatorial candidate Bill Randles, said that the court got that decision right.

In his response to the ruling, Randles said that the court “found that Obamacare was attempting to transform Medicaid from a program designed to provide medical services to discreet, vulnerable populations into a general entitlement for everyone whose income is 133 percent of the poverty line. The court found that this would violate the essential contract nature between the states and the federal government, and the government could not withhold all Medicaid funds simply because a state would not go along with the new expansion. The court emphasized that whether or not a state goes along with this expansion is now a state by state determination.”

Ishmael, from the Show-Me Institute, said that decision, from a policy standpoint, was a success.

House Majority Leader Eric Cantor (R-Va.) vowed that the House will vote on July 11 to repeal the health care law. And, while the repeal should pass easily through the Republican-controlled House, it is unlikely to make it through the Senate.