SUPREME COURT UPHOLDS THE INDIVIDUAL MANDATE

At approximately 10:00 today, in a vote of 5-4 Chief Justice Roberts, siding with the liberal Justices, read that the Individual Mandate under the Affordable Care Act (Health Reform) is constitutional not as interstate commerce but as a tax.  In other words the government can't force individuals to purchase health care but they can impose a tax penalty if they don't.  


For people in favor of the law, this is an obvious win in their direction.  However, people not in favor of the law, the President, or continued government over-reach could see this as helpful for Romney's presidential bid in November.

HAGGLING OVER HEALTHCARE-A SUPREME DECISION

Is making individuals pay for health insurance or pay a penalty constitutional?  That, over three days last week, was being argued in front of the US Supreme Court.  At this point it's any body's guess, however, a decision will be reached sometime in June. 

In additional to the individual mandate, what else will need to be taken out of the Health Reform Law in order to protect it from abuse?  At the very least, guaranteed issue coverage would need to be taken off the table.  And possibly open enrollment periods added in.  Without this there would be no way to protect from people jumping on and off plan when they needed care......which would be catastrophic. 

During the several days of testimony the more liberal Justices seemed to drive questions that would uphold the law while the conservative Justices were not as sure about congress' power regarding making people purchase health coverage.  The Justices include 5 Republicans and 4 Democrats. 

This is a very big deal to the Obama Administration.  He has even issued a "Challenge" to the Supreme Court to uphold the law.  If this law fails or at least a major portion (Individual Mandate), it could have devastating impacts on his re-election effort.

GAME TIME!....U.S .SUPREME COURT TO HEAR ARGUMENTS ON INDIVIDUAL MANDATE

Admit it, you thought I was talking about March Madness, right? The U.S. Supreme Court is set to hear arguments later this month regarding the constitutionality of the Individual Mandate.  If you recall, the individual mandate is that provision in PPACA (Health Reform) that states all people must have individual medical coverage or face a fine.  How the outcome could affect the way employers offer medical coverage could go several different ways.

If the Mandate is ruled constitutional, health reform will continue on its path, states will continue to set-up their exchanges and employers will need to make decisions whether to continue to offer coverage or send employees to the exchanges or a combination of both.  Employer groups of under 50 employees will see little or no monetary adverse consequence to sending employees to the exchange or not because there are no penalties to do so.  If the employer has over 50 employees, not offering some form of minimal essential coverage could cause fines and penalties levied on them.  There are decisions, especially for employers under 50 employees, if its financially prudent to shut down their medical plans and send all employees to the exchanges.  There are schools of thought that for some employers, in order to stay competitive, they will need to continue to offer employer sponsored coverage.

If the Mandate is ruled unconstitutional there is no requirement for employees or anyone else to elect medical coverage.  Since the individual mandate is a guard against "adverse selection" and allows risk to be spread among everyone, it could potentially be the death of the health reform law as it is written.  Since there are no pre-existing condition exclusions and individuals would be able to come onto plan when they wanted, mostly the people electing coverage would be those that needed it.  In other words there is no incentive, or dis-incentive not to carry coverage.  So the risk pool would be made of mostly sick people and eventually would make the cost of coverage unaffordable leaving us in a much worse place then we are now. 

If the individual mandate was removed, other provisions like no pre-existing condition limitations may need to be adjusted to keep people from hopping on-plan simply when they need coverage.  Some thoughts could be limited open enrollment periods, higher premiums for those outside of this period, etc. 

In all, health reforms are needed.  Forcing people to carry coverage may or may not be a good thing.  As far as employers are concerned there is much to keep our eye on in the upcoming months as we draw closer to full implementation of health reform.

SUPREME COURT TO HEAR HEALTH CARE LAW CASE

The US Supreme Court announced that it will hear over 5 hours of oral argument regarding the legality of certain provisions under the health care law (PPACA).  In particular below is the allotted times for each argument to be heard:

• 90 Minutes-Whether the entire health care law should be terminated if the "Individual Mandate" is ruled unconstitutional. 
• 120 Minutes-Did Congress have the power under Article 1 of the Constitution to enact the Affordable Care Act? (Article 1 regulates interstate commerce and other laws under Congressional Authority they are able to pass)
• 60 Minutes-determine if the Supreme Court should rule on whether the individual Mandate Penalty constitutes a tax.  This would thereby trigger a federal statute called the anti-injunction act.  They may not be able to rule on this as there hasn't been any tax levied since this provision doesn't go into effect until 2014 (This is required under the anti-injunction act)
• 60 Minutes-Determining the Constitutionality of Congress allowing the Federal Government to allow states to gain funding based on their participation in the Laws Health Care Reforms.

 Arguments are slated to be heard sometime in mid-March with decisions possibly by the end of June prior to the summer break.