The Supreme Court and health care: What’s next?


Barring a miracle, the individual mandate in the Obama health care act is dead. But even another possibility exists that the entire law may be voided by the Supreme Court. This should have never gotten to this point. But what if the act is struck, what then?

The Patent Protection and Affordability Health Care Act (Obamacare or the Obama health care act “OHCA”) was always a flawed act to start. Yes it ensured an additional 36 million individuals and that was great. Yet it excluded universal coverage still leaving several million without health insurance. Yes the law also requires insurers to issue policies to those with preexisting illnesses and to allow parents to keep their children until age 25 on their policies, but there was little in the law to deal with the cost issues. The government would still be barred from negotiating with drug companies for better prices, private insurance companies would face little market competition, and the vast administrative costs that the current system produces would not be addressed. All of these problems rendered OHCA a flawed piece of legislation.

Yet flaws like these make it bad legislation but not unconstitutional.  The reason the law is before the Court is because it is a Republican idea. The individual mandate is originally a Republican idea offered in place of the single-payer option. Obama embraced it and the Democrats pushed it through Congress with barely a Republican vote. The latter turned on the individual mandate after trumpeting it, and now they are calling their idea unconstitutional.  How ironic. Even more ironic is the fact when the Supreme Court heard the case last week one of the Justices even suggested that the way to get around the possible constitutional problems was to adopt a single-payer system.

Following the hearings last week was amazing. The OHCA is a lesson in sloppiness. The Solicitor General who argued the case before the Supreme Court was weak. Going into orals anyone who knew anything knew that the central issue and most important question to answer for the Court was to indicate what are the limits of the Commerce clause. Specifically, since the authority for the individual mandate rested on whether health care came within the realm of interstate commerce that Congress could regulate, the government needed to show that it had the power to act. But in demonstrating that, one knew Justice Kennedy–the swing vote–for example, would want to know if there are any limits to the Commerce clause if the individual mandate were upheld. 

Solicitor General Verrilli failed to answer this question. He had an easy answer. He could have pointed to a 1992 decision United States v. Lopez where the Court struck down a provision of the Gun-Free School Zones Act of 1990 as exceeding federal commerce powers, and to a 2000 Court decision in United States v. Morrison where it struck down a provision of the Violence Against Women Act of 1994 as exceeding federal commerce powers. He could have said these two cases established the outer boundaries of the Commerce clause, articulated the reasoning in them, and he would have done his job. Instead, he gave an opening to Justice Scalia to ask stupid questions about the federal government mandating people to buy broccoli under the Commerce clause. We should have never gotten there.

Additionally, the hearing on severability should have never taken place. The severability issue is over whether if the individual mandate is struck the entire law is dead. A general piece of boilerplate attached to bills is a severability clause stating that if the courts declare any part of the law unconstitutional the section voided would be severed from the rest of the law, preserving it. One would have thought in a 2,000 page law this boiler plate would have been in it, but it was not. Sloppy. Thus the real possibility of a Court voiding the entire law.

But the Court itself has also been sloppy here. Clarence Thomas should have recused himself from the case because of his wife’s political activities in opposition to the law. Similarly, a case can be made that Justice Kagan too should have recused herself because of possible involvement with the law at the Justice Department. But this is also a Roberts Court that is perhaps the most conservative Supreme Court since the 1930s, and its excesses in this and other recent ones such as Citizens United strip away any veneer that conservatives do not engage in judicial activism.

But what is the law is voided, where are we? At present the United States spends 18% of its GDP on health care and with Baby Boomers aging, it is projected to increase to perhaps 20%. With the United States current GDP at $15 trillion in 2011, total health care spending is $2.25 trillion. America has the most costly health care system in the world, both in real dollars and in GDP percentage. The Netherlands is second in terms of percentage of the GDP spent on health at 12%. The US spends an average of $8,000 per person on health care, other developed countries about $2,000. They also achieve what we do not–universal coverage–and often have higher life expectancies, lower infant mortality rates, and generally better health care outcomes than we do. Out system is expensive and it does not deliver the goods, unless you are well insured.

But defenders of the American health care system love to point to freedom. They say our current system maximizes choice. They love to point to stories about people in Canada flocking to the US for coverage or for long waits in line for elective surgeries such as nose or boob jobs. Yes this may be true and perhaps other problems exist, but how much choice do we really have in the US? For those without healthcare, how much choice is there? For those in HMOs how much choice is there? The reality is there is little health care choice for millions in the USA.

Reforming health care is critical to the future of the US economy. Image if the US spent only 12% and not 18% of its GDP on health care. That would save the country $750 billion per year? What could we do with that money? Pay down the debt, cut taxes, invest in roads and schools, or more. Solving the health care crisis is still going to be with us after the Supreme Court rules, Republicans take over, or Obama remains in office.