Health reform goes to court

Health reform goes to court

November 16th, 2011 in Opinion Times

The Supreme Court's decision Monday to review the constitutionality of the 2010 health care reform act, and its linchpin mandate requiring most Americans to purchase health insurance, puts in motion a trial of one of the nation's most heavily freighted political controversies in decades, and will do so amid a heated presidential election. Whether that's fair or good for the nation remains to be seen. Yet regardless of the court's ruling, it has already become clear that the need for reform is too huge, too critical and too compelling to be stifled by inaction. If the court's controlling conservative judges are at all attuned to justice for the nation's needs, they will rise above political currents and affirm the federal government's role in devising and marshaling systemic health care reform.

The court has promised to hear selected appeals on the constitutionality of the Affordable Care Act next March, and to deliver an opinion by June. That will place its ruling in the middle of a super-heated presidential campaign which may turn on the court's decision in this historic case.

Ironically, it's impossible to predict the impact of the court's decision, whatever it decides. At first glance, it would seem that the Obama administration would benefit from a decision affirming the constitutionality of the act, and its central provision requiring Americans to purchase health insurance (largely with the broad federal wage-indexed subsidies for most families).

Yet affirmation of the reform act might energize opponents to elect a presidential candidate and representatives who promise to repeal the reform act. Similarly, a court decision to overturn the act might rally its supporters around the administration to advance the hope of passing a bona fide public plan as a voluntary option for Americans to private insurance. Such a plan, say, an expansion of Medicare for all who elect to pay a fair, flat-rate premium to join a full-benefit plan with no pre-existing conditions, would benefit most families. It certainly would be cheaper and far superior to private insurance companies that cherry-pick the healthy, deny people with pre-existing conditions, and spend outrageous shares of premium revenue on executives' breath-taking salaries and stock options.

It is these insurance industry tactics that create the nation's unaffordably high rates of uninsured and of under-insured Americans. More than 50 million Americans are uninsured. An equal number are under-insured who, like the uninsured, are also vulnerable to bankruptcies due to outrageous medical costs -- now the largest segment of the nation's bankruptcies.

These are national problems that argue for the Affordable Care Act's provisions that ban pre-existing conditions and annual and lifetime limits on coverage, and that fix flat community rates and guarantee enrollment for all purchasers. The Obama administration rightly argues that the purchase-mandate is just one of several "absolutely intertwined" reform mechanisms that are needed to assure a stable health insurance system for the nation.

The administration correctly views the insurance purchase-mandate and its wage-indexed subsidies as a constitutionally permissible mechanism, under the commerce clause, to ensure an orderly interstate insurance market responsive to public needs. In that sense, the mandate operates much like a stabilizing federal minimum wage, which places a federal floor on wages paid by private employers, and yet allows states to require, as many do, a higher minimum wage.

Without the purchase mandate, for example, insurance companies would not receive the enrollment volume they need to make the Act's flat-rates and scope of coverage affordable. And congressionally required care for uninsured free-riders would continue to require hospitals, doctors and insurers to shift the costs of treating the uninsured to the premiums and bills of paying patients, distorting the health care market and aggravating the costs to payers and care-givers.

That dilemma has spurred the unregulated chaos and costs of the health care industry, and propelled America's health care costs to nearly double the per-capita cost of health care in other western countries. In another couple of years, those costs will account for an unsustainable 20 percent of the nation's GDP. If the Supreme Court rules in these circumstances that the commerce clause doesn't permit federal intervention for the good of the nation, it will sink the economy -- and the hope for affordable health care.