After three days, the Supreme Court arguments have ended and now we must wait until June or July to learn whether the entire Patient Protection and Affordable Care Act will be struck down, whether the individual mandate will be declared unconstitutional, and if the Medicaid program will be allowed to expand to include millions of potential enrollees.
Unsurprisingly, the court appears divided along ideological lines. Ultimately, the votes of Chief Justice John Roberts and Justice Anthony Kennedy appear to be in play. The court's liberal arm —Justices Sonia Sotomayor, Elena Kagan, Stephen Breyer, and Ruth Bader Ginsburg—are expected to uphold the individual mandate and PPACA. On the conservative side, Justices Antonin Scalia, Samuel Alito, and Clarence Thomas are expected to vote to overturn the individual mandate.
Two years ago when Congress narrowly passed PPACA the Obama administration expected opposition to the bill to dissolve once Americans became familiar with the bill. Strong support for the bill has never materialized, although specific aspects of the law are popular, according to Kaiser Family Foundation tracking polls. For example, closing the donut hole for Medicare recipients is well received while the individual mandate has generally scored very low with survey respondents.
A roller coaster ride of federal court decisions
PPACA began winding through the court system almost immediately after it was passed in March 2010. The first sign of trouble came in August 2010 when a district court in the Eastern District of Virginia declined federal government's motion to dismiss. That set the ACA on a roller coaster ride of federal court decisions with some supporting the individual mandate and others ruling it unconstitutional. In November 2011 the Supreme Court agreed to review the case.
In eight hours of oral arguments over three days five lawyers debated four key issues: jurisdiction, the individual mandate, "severability" (whether the individual mandate severable from PPACA), and the expansion of Medicaid eligibility.
Every question, nuance, and inflection of the justices during oral arguments has been parsed by observers and pundits in an effort to discern how the court might ultimately rule. While that's all very interesting, attorney Thomas Barker says the oral arguments will have little effect on the ultimate outcome. "If their minds aren't already made up then they get made up based on the briefs filed by the parties and maybe the amicus briefs but not what happens at oral arguments."
Barker, who specializes in healthcare and is partner in the Washington, DC office of Foley Hoag, says he began the week thinking that the individual mandate would be upheld, but admits that he's not as sure now.
"I had the sense that the court would be reluctant to choose this case as the limit for how far the commerce clause power can go. I was skeptical that would happen, but Justice Kennedy seemed to put that in play."
A question of commerce
In one of his first questions, Justice Kennedy asked if the government could force someone into commerce in order to regulate them under the commerce clause." That could be the distinction, Barker explains, between this case and Wickard vs. Filburn, which is the case the government is relying on for the mandate.
That New Deal case tested the powers of Congress to regulate the grain market and keep grain prices in check by limiting the amount of grain that could be produced by any one farmer. Filburn, an Ohio farmer, contended that he could grow as much grain as he wanted because he was using the excess for his family. In that case the court ruled that activity constitutes commerce even if the activity doesn't have an impact on interstate commerce.
For PPACA the administration is arguing that inactivity—not purchasing health insurance—falls under the same ruling because people who don't purchase health insurance make it more difficult and costly for those who do. Solicitor General David Verrilli argued that "what is being regulated is the method of financing the purchase of healthcare. That itself is an economic activity with substantial effects on interstate commerce."
In reviewing the transcript, Verrilli seemed to struggle with this argument as Justice Scalia and Chief Justice Roberts asked if the government could require the purchase of cell phones and even broccoli under the commerce clause.
Justice Ginsburg stepped in to clarify the point. "I thought a major, major point of your argument was that the people who don't participate in this market are making it much more expensive for the people who do. They will get services that they can't afford at the point when they need them, and the result is that everybody else's premiums get raised. So, it's not your free choice just to do something for yourself. What you do is going to affect others, affect them in a major way."
Barker expects the Supreme Court to rule that it has jurisdiction over the case and to uphold the Medicaid expansion. He believes the individual mandate will be ruled unconstitutional and that the mandate will be ruled either completely severable or the severability will be limited to insurance rating reform.
If the individual mandate is ruled unconstitutional, Barker says there are alternatives to consider, including taxing the uninsured and limiting health insurance enrollment periods for the individual market.
The debate over severability was equally troubling for the administration. In answering a question from Justice Ginsburg about salvaging portions of PPACA if the individual mandate is rules unconstitutional, Paul Clement, who argued that the PPACA should be thrown out if the individual mandate is eliminated, explained that "the provisions that have constitutional difficulties or are tied at the hip to those provisions that have the constitutional difficulty are the very heart of this act. And then if you look at how they are textually interconnected to the exchanges, which are then connected to the tax credits, which are also connected to the employer mandates, which is also connected to some of the revenue offsets, which is also connected to Medicaid. If you follow that through what you end up with at the end of that process is just sort of a hollow shell."
Reconsideration
Justice Scalia suggested that it would be better to have Congress reconsider the entire act rather than on a piecemeal basis. "One way or another, Congress is going to have to reconsider this, and why isn't it better to have them reconsider it—what should I say—in toto, rather than having some things already in the law which you have to eliminate before you can move on to consider everything on balance?"
That argument worries Gerald F. Kominski, PhD, director of the UCLA Center for Health Policy Research. "We don't have a bipartisan solution to the problem. If we return to the status quo, we'll face a crisis."
Justine Handelman, vice president of legislative and regulatory policy for the Blue Cross Blue Shield Association, explains that the loss of the individual mandate would require that other reforms be severed from PPACA, including the guarantee issue provision, pre-existing condition exclusions, and the use of an adjusted community rating system.
Handelman notes that studies of eight states that enacted guaranteed issue and community ratings without individual mandates showed higher premiums, coverage disruptions, and fewer choices for consumers.
The Blue Cross Blue Shield Association filed an amicus brief in support of severing the individual mandate from PPACA if the mandate is ruled unconstitutional.
Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
