Striking down the mandate would be a huge deal legally, because it would signal the Court is prepared to resume its Gilded Age function as a kind of right-wing GOP super-legislature, wantonly tossing out laws that offend laissez-faire orthodoxy. It would be, in addition to a travesty of justice, a tragedy, depriving millions of Americans access to health insurance. I want to be clear about this: If the Court strikes down the mandate, I will lose my shit. But striking the mandate would not end the law, or even most of the law. – How Badly Will SCOTUS Screw Up Healthcare, by Jonathan Chait
WAITING FOR SCOTUS to rule on the Affordability Care Act, aka Obamacare, aka Romneycare, is coming to an end. We could know as soon as Monday.
As someone not in favor of the mandate, I also realize that without it premiums rise. Tax credits in Obamacare make a path for people to buy health insurance. The CBO numbers [PDF] are not lost on me: not having a mandate would increase the number of uninsured by 16 million, bringing the total uninsured to 39 million by 2019.
Kaiser Foundation wrote about the mandate a couple of days ago:
If the individual mandate were overturned by the court with the rest of the ACA untouched, we would be left with an individual insurance market beginning in 2014 where everyone would be guaranteed access to insurance, even if they have pre-existing health conditions requiring expensive medical care. Insurers could not turn people down based on health status, restrict their coverage, or surcharge their premiums. People who are healthy could choose to forego insurance, knowing that they could start buying it if they get sick (although they’d have to wait until the next open enrollment period). …
[...] So, why would invalidating the individual mandate not lead inevitably to a death spiral under the ACA? Two reasons:
First, and most importantly, the ACA includes federal tax credits to make insurance more affordable for people buying on their own in the new health insurance exchanges. This means that for many people, health insurance will be a very good deal, even if they are healthy. The primary reason that people remain uninsured is because they believe they cannot afford to buy insurance, and the subsidies address that directly. Our analysis of Congressional Budget Office (CBO) estimates suggests that over half of people in the individual insurance market beginning in 2014 will be receiving a tax credit towards their premiums.
[...] Second, the ACA allows significant variation in premiums due to age. Young people generally have less need for health care services, and they will pay lower than average premiums as a result. This was not true under insurance reforms in New York and (originally) in New Jersey, where insurers were required to charge “pure” community rates, meaning the same premium to everyone, irrespective of age. Predictably, younger people fled the market and older people remained. This should not generally happen under the ACA. (Note that the ACA does limit the variation in premiums due to age, requiring an insurer to charge its oldest enrollee no more than three times the premium for its youngest enrollee for equivalent coverage. In the current market, age-based premiums can vary by a factor of five to one or more. This could lead to some adverse selection based on age, but the effect should be relatively modest because there will still be significant variation in premiums allowed for age.)
I’ll be surprised if the Supreme Court leaves the Affordability Care Act intact, but shocked if the mandate stays in place. I don’t think there’s a chance in hell they’ll nuke the entire law.
How much of this quarter of the law the Court decides to cut out is the guessing game. In ascending order, the Court might:
- Leave it all in place.
- Technically eliminate the mandate to buy health care while leaving in place the fine for not having health insurance. (Essentially upholding the fine as a tax while technically eliminating the requirement.)
- Eliminate the mandate, and the fine, but leave in place the regulations that insurance companies not discriminate against people with health risks and the subsidies for buying insurance.
- Eliminate the mandate, the fine, insurance regulations, and the subsidies.
- Nuke the entire law.
[via Jonathan Chait]
But let’s just say SCOTUS does throw out Obamacare. I still don’t think it’s the end of the world. Congress will simply have to do their job through incremental steps and laws to address the runaway costs of America’s private insurance boondoggle, otherwise our entire country will go bankrupt, with or without the inevitable “grand bargain” push that’s coming down the pike after the 2012 elections.