Podcast Center
Video Center
Webcasts
Resource Center
Events
June 29, 2012 at 10:41 AM
Q. Who wrote the majority opinion?
A. Chief Justice John Roberts.
Roberts wrote the core opinion delivering the view of the court that a federal law restricting tax suits, the Anti-Injunction Act, does not bar consideration of a major suit challenging the constitutionality of the Patient Protection and Affordable Care Act of 2010 (PPACA), NFIB vs. Sebelius.
In the majority opinion, Roberts also writes that neither the Commerce Clause nor the Necessary and Proper Clause of the Constitution allow Congress to impose an individual health insurance ownership mandate; that the individual mandate is a tax; and that the Taxing Clause of the Constitution does permit Congress to impose the individual mandate penalty payment requirement.
Roberts was joined by two other justices, Stephen Breyer and Elena Kagan, in a section of the opinion on the PPACA Medicaid expansion provisions.
For exclusive, ongoing coverage of the PPACA verdict and its impact on the industry, visit www.lifehealthpro.com/PPACA.
Q. What did the court say about the individual health insurance ownership mandate?
A. The Commerce Clause of the U.S. Constitution does not give Congress the authority to make individuals buy commercial products, but the Constitution does give Congress the authority to “lay and collect Taxes” on individuals who fail to buy commercial products.
Q. What does the Supreme Court think the PPACA individual health insurance “shared responsibility payment” is?
A. A tax.
“Although the payment will raise considerable revenue, it is plainly designed to expand health insurance coverage,” Roberts says. “But taxes that seek to influence conduct are nothing new. Some of our earliest federal taxes sought to deter the purchase of imported manufactured goods in order to foster the growth of domestic industry. … Today, federal and state taxes can compose more than half the retail price of cigarettes, not just to raise more money, but to encourage people to quit smoking. And we have upheld such obviously regulatory measures as taxes on selling marijuana and sawed-off shotguns.”
Q. Does taxing a type of inactivity make that inactivity illegal?
A. No.
“While the individual mandate clearly aims to induce the purchase of health insurance, it need not be read to declare that failing to do so is unlawful,” Roberts says. “Neither the Act nor any other law attaches negative legal consequences to not buying health insurance, beyond requiring a payment to the IRS. The Government agrees with that reading, confirming that if someone chooses to pay rather than obtain health insurance, they have fully complied with the law.”
Q. If taxing inactivity made the inactivity illegal, how many outlaws would PPACA create?
A. 4 million.
“It is estimated that four million people each year will choose to pay the IRS rather than buy insurance…” Roberts says. “We would expect Congress to be troubled by that prospect if such conduct were unlawful. That Congress apparently regards such extensive failure to comply with the mandate as tolerable suggests that Congress did not think it was creating four million outlaws.”
Q. How can Congress put pressure on states to expand Medicaid?
A. Congress can put strings on how states use new money but can’t change the rules governing use of existing Medicaid funding.
