A number of legal challenges to the health care reform law have been filed in federal court since the law was passed in March 2010. Nearly all of the challenges have been based on constitutional grounds. So far, four U.S. Courts of Appeals – the 4th, 6th, 11th and D.C. Circuits – have ruled on challenges to the health care reform law. Two of the courts have upheld the law, one has not and another has ruled that the plaintiff did not have standing to bring a challenge.
On November 14, 2011, the U.S. Supreme Court announced that it will review the health care reform law during its 2012 term. This development is significant to the fate of the health care reform law, because the Supreme Court will ultimately decide whether or not the law is constitutional. It is expected that the Supreme Court will issue its decision by June 2012, which would be just over four months from the 2012 presidential election.
While some of the challenges to the health care reform law have been decided based on procedural grounds, the main substantive controversy has been whether Congress had the authority under the Constitution’s Commerce Clause to pass the health care reform law’s individual mandate. The Commerce Clause gives Congress the power to regulate multi-state, economic activity.
Beginning in 2014, the individual mandate generally requires individuals to purchase health insurance or pay a penalty. Health care policy experts have suggested that without the individual mandate health care reform’s other insurance market reforms would be difficult to implement. If the individual mandate is ruled invalid and health insurers are still required to comply with the law’s guaranteed issue and preexisting condition exclusion restrictions, it is speculated that health insurance costs would skyrocket, because people would tend to buy coverage only when they actually need it.
Opponents of the health care reform law argue that the Commerce Clause does not give Congress the power to regulate economic inactivity (that is the decision to purchase health insurance). Proponents of the law point to the health care costs associated with the uninsured to demonstrate the economic effect of not purchasing health coverage.
Supreme Court Review
The Supreme Court justices have decided to hear 5½ hours of oral argument on the law’s constitutionality and related issues, which will likely be spread over two or more days. This is an extraordinary amount of time for oral argument – most modern court cases only receive one hour of oral argument – and is indicative of the importance of the health care reform law challenges.
Assurance Edge will continue to monitor the status of the health care reform law and will provide updated information throughout 2012.