March 21, 2012

Predicting Supreme Court Healthcare Decision

By Glenn

“Glenn how is the Supreme Court going to rule on the healthcare Individual mandate? Any predictions? If they lose the mandate what happens to the plan? Obviously there are some good points to the plan but do they go back to the drawing board?”

Awesome question.  I’m not a lawyer but I love to play one on the internet.  I’m glad the question focuses on the fact that only the individual mandate, not the entire law, is before the court.  One fine, but important point is left out of the question.    Even the “individual mandate” is NOT in question.  The question is can the federal government PENALIZE an individual for not purchasing a PRIVATE product or service.

Let’s proceed.


  1. Most likely outcome is that the Supreme Court votes 5 to 4 to uphold the mandate.  Congress has the authority to legislate to “promote the general welfare” and “regulate interstate commerce.”  The greatest threat to our public finance is out of control health care costs which at present are set by interstate markets.
  2. Next likely outcome is that the Supreme Court punts, saying it will not take up the case until an individual is harmed, i.e. the federal government fines a person for seeking medical attention without an ability to pay.  That individual would then have to “test” the law.  See Plessey v Ferguson.
  3. Least likely outcome is the Supreme Court rules the individual mandate is unconstitutional.  Justice Kennedy would have to vote against the law, and after the disaster which is Citizens United, I really don’t see him taking another bite of the ideological apple.

Now let’s deal with the second part, what happens in the unlikely event that the Supreme Court rules against Obamacare (personally I love this name because it reminds people Obama Cares).   It will be fixed fast.  The Healthcare Industry needs the added revenue to survive.  No one is questioning universal coverage.  There will be affordable options for all Americans

How will this happen?

The simplest Congressional fix is to tax anyone without insurance.  There is no question the federal government can recoup the costs uninsured people pass on to the state and federal governments.  This will not be politically popular because it would require actually using the dreaded tax word.  In the end, however, pressure from the insurance industry makes this the most likely solution.

A better solution would be for Congress to open Medicare to anyone who wants to buy it regardless of age.  We already know it provides services that are less expensive than private insurers.  These would be basic packages and individuals could freely buy private supplements.   The law would simply be modified to remove the penalty and replace it with a bill for Medicare.  Instead of buying Medicare for old age, a UNINSURED person would be required to buy Medicare.

The least like likely solution would be to move to a single payer system–Medicare for All.  It would, however, make sure that more healthcare dollars go to actually coverage instead of administrative costs and profits.  In the end, it would be the most popular solution.

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