Supreme Court Upholds Affordable Care Act

In a ruling that surprised many experts, and was a huge victory for the Obama administration, the Supreme Court upheld the Affordable Care Act, meaning that most of the health care reform law will stay in place, as reported by Politico [1]. The court ruled 5-4 that the federal government did not violate the Constitution by requiring every individual to buy health insurance. The decision was hailed as a victory for small businesses by the Small Business Majority.

In the majority opinion, Chief Justice John Roberts wrote that the court held the authority to impose a mandate under Congress’s taxing powers. “Under the mandate, if an individual does not maintain health insurance, the only consequence is that he must make an additional payment to the IRS when he pays his taxes,” Roberts wrote. “That, according to the Government, means the mandate can be regarded as establishing a condition — not owning health insurance — that triggers a tax — the required payment to the IRS. Under that theory, the mandate is not a legal command to buy insurance. Rather, it makes going without insurance just another thing the Government taxes, like buying gasoline or earn­ing income. And if the mandate is in effect just a tax hike on certain taxpayers who do not have health insurance, it may be within Congress’s constitutional power to tax.”

Roberts added: “The question is not whether that is the most natural interpretation of the mandate, but only whether it is a ‘fairly possible’ one…. The Government asks us to interpret the mandate as imposing a tax, if it would otherwise violate the Constitution. Granting the Act the full measure of deference owed to federal statutes, it can be so read.”

In a statement, the Small Business Majority (SBM) hailed the Supreme Court’s decision [2], stating that it is a victory for small business owners “who have struggled with the excessively high cost of health insurance for decades. The Affordable Care Act tackles small business owners’ top priorities when it comes to healthcare reform: cost and accessibility. The law will significantly rein in costs while providing more health coverage options for entrepreneurs.”

The SBM statement noted that “many components of the law, including rate review … have already resulted in lower premium costs for small employers. It also help ends ‘job lock,’ where a prospective entrepreneur who has a preexisting medical condition cannot leave their job, launch a new company, or help grow the economy because they are locked in their job for health benefits. And in 2014 the law calls for health insurance exchanges to be set up in every state, which will do even more to curb costs and boost choice. State lawmakers who have blocked implementation must now step up to the plate and work with local small businesses to establish these new competitive marketplaces.” 

SBM further stressed that “today’s ruling lets us get back to what’s important: implementing the law and getting small business owners the financial relief they’ve been waiting for.”

Watch for ongoing health care reform coverage in future editions of Bookselling This Week.