Health Care Reform

After decades of failed attempts by a string of Democratic presidents and a year of bitter partisan combat, President Obama signed legislation on March 23, 2010 to overhaul the nation’s health care system and guarantee access to medical insurance for tens of millions of Americans.
The health care law seeks to extend insurance to more than 30 million people, primarily by expanding Medicaid and providing federal subsidies to help lower- and middle-income Americans buy private coverage. It will create insurance exchanges for those buying individual policies and prohibit insurers from denying coverage on the basis of pre-existing conditions. To reduce the soaring cost of Medicare, it creates a panel of experts to limit government reimbursement to only those treatments shown to be effective, and creates incentives for providers to “bundle’' services rather than charge by individual procedure.
The law will cost the government about $938 billion over 10 years, according to the nonpartisan Congressional Budget Office, which has also estimated that it will reduce the federal deficit by $138 billion over a decade.
It was the largest single legislative achievement of Mr. Obama’s first two years in office, and the most controversial. Not a single Republican voted for the final version, and Republicans across the country campaigned on a promise to repeal the bill. In January 2011, shortly after they took control of the House, Republicans voted 245 to 189 in favor of repeal, in what both sides agreed was largely a symbolic act, given Democratic control of the Senate and White House.
Supreme Court to Hear a Challenge
With Republicans unable to repeal the bill, its fate rests in the hands of the Supreme Court, which in November 2011 agreed to hear a challenge to the law. The development set the stage for oral arguments by March and a decision in late June, in the midst of the 2012 presidential campaign.
But in the meantime vast changes have been set in motion that are likely to persist no matter what the court’s ruling. Provisions already put in place, like tougher oversight of health insurers, the expansion of coverage to one million young adults and more protections for workers with pre-existing conditions are already well cemented and popular. And the law, along with economic pressures, has forced major institutions to wrestle with the relentless rise in health care costs.
More than 20 court challenges were filed against the law and led to a series of conflicting appellate decisions that present an array of issues. But the central one is whether Congress has the constitutional power to require people to purchase health insurance or face a penalty through the so-called individual mandate. The insurance mandate is central to the law’s mission of expanding coverage, because insurers argue that only by requiring healthy people to have policies can they afford to treat those with expensive chronic conditions.
The Supreme Court agreed to hear appeals from just one decision, from the United States Court of Appeals for the 11th Circuit, in Atlanta, the only one so far striking down the mandate. The decision, from a divided three-judge panel, said the mandate overstepped Congressional authority and could not be justified by the constitutional power “to regulate commerce” or “to lay and collect taxes.”
The appeals court went no further, though, severing the mandate from the rest of the law.
The justices agreed to decide not only whether the mandate is constitutional but also, if it is not, how much of the balance of the law, the Patient Protection and Affordable Care Act, must fall along with it.
Not every appeals court struck down the mandate. In November 2011, a federal appeals court in Washington upheld the law in a decision written by a prominent conservative jurist, Judge Laurence H. Silberman.
In the opinion, Judge Silberman, who was appointed by President Ronald Reagan, described the law as part of the fundamental tension between individual liberty and legislative power.
“The right to be free from federal regulation is not absolute, and yields to the imperative that Congress be free to forge national solutions to national problems, no matter how local — or seemingly passive — their individual origins,” he wrote. The fact that Congress may have never issued an individual mandate to purchase something before, a central argument for many opposing the law, “seems to us a political judgment rather than a recognition of constitutional limitations,” he wrote.
Background
The Democrats’ desire for universal access to health insurance runs deep. President Franklin D. Roosevelt hoped to include some kind of national health insurance program in Social Security in 1935. President Harry S. Truman proposed a national health care program with an insurance fund into which everyone would pay. Since then, every Democratic president and several Republican presidents have wanted to provide affordable coverage to more Americans.
President Bill Clinton offered the most ambitious proposal and suffered the most spectacular failure. Working for 10 months behind closed doors, Clinton aides wrote a 240,000-word bill. Scores of lobbyists picked it apart. Congressional Democrats took potshots at it. And Republicans used the specter of government-run health care to help them take control of Congress in the midterm elections of 1994.
One of the most significant differences between 1993-94 and 2009-10 is that employers and business groups, alarmed at the soaring cost of health care, took a seat at the negotiating table. Insurance companies, which helped defeat the Clinton plan, began 2009 by saying they accept the need for change and want a seat at the table. As the bills developed, however, they became strong opponents of some Democratic proposals, especially one to create a government-run insurance plan as an alternative to their offerings.
In his budget for 2010, Mr. Obama gave an indication of the scope of his ambitions on health care reform when he asked Congress to set aside more than $600 billion as a down payment on efforts to remake the health care system over the next 10 years. But after sending Congress his budget plan, Mr. Obama’s White House, displaying a surprisingly light touch, encouraged Democrats in Congress to make the hard decisions.
By the end of March 2009, the chairmen of five Congressional committees had reached a consensus on the main ingredients of legislation, and insurance industry representatives had made some major concessions. The chairmen, all Democrats, agreed that everyone must carry insurance and that employers should be required to help pay for it. They also agreed that the government should offer a public health insurance plan as an alternative to private insurance.
Separate Democratic Bills

Democrats worked on three separate paths to develop legislation in the summer of 2009. On June 14, House Democratic leaders introduced their bill, which in addition to a public plan included efforts to slow the pace of Medicare spending, a tax on high-income people and penalties for businesses that do not insure their workers. After a revolt by a conservative group of “Blue Dog’' Democrats that led to more exemptions for businesses, the plan was adopted by three committees without Republican support.
In the Senate, the Health, Education, Labor and Pensions Committee worked on a bill with a public insurance plan, while the Senate Finance Committee, led by Senator Max Baucus, Democrat of Montana, worked on a bill that sought to avoid one, which Mr. Baucus thought was necessary to gain bipartisan support.
On July 15, the Senate health committee passed its bill on a party-line vote of 13 to 10, with all Republicans opposing the package. Both Republicans and Democrats acknowledged that the health committee bill was just part of what would eventually be a single Senate measure.
The Battle for Public Opinion
During the Congressional recess in August 2009, the White House appeared to lose control of the public debate over health care reform to a wave of conservative protests.
Democratic Party officials acknowledged that the growing intensity of the opposition to the president’s health care plans — plans likened on talk radio to something out of Hitler’s Germany, lampooned by protesters at Congressional town-hall-style meetings and vilified in television commercials — had caught them off guard.
On Sept. 9, Mr. Obama confronted a critical Congress and a skeptical nation, decrying the “scare tactics” of his opponents and presenting his most forceful case yet for a sweeping health care overhaul that has eluded Washington for generations.
When Mr. Obama said it was not true that the Democrats were proposing to provide health coverage to illegal immigrants, Representative Joe Wilson of South Carolina yelled back, “You lie!” Mr. Wilson apologized but his outburst led to a six-day national debate on civility and decorum, and the House formally rebuked him on Sept. 15.
The president’s speech appeared to restore momentum to the reform effort, at least for the moment, according to polls that followed.
The Baucus Bill
When Mr. Baucus introduced his long-awaited plan in the fall of 2009, the bill closely resembled what Mr. Obama said he wanted, except that it did not include a new government insurance plan to compete with private insurers.
Unlike the other bills, the Baucus plan would impose a new excise tax on insurance companies that sell high-end policies. The bill would not require employers to offer coverage. But employers with more than 50 workers would have to reimburse the government for some or all of the cost of subsidies provided to employees who buy insurance on their own.
The bill got a significant boost when the Congressional Budget Office announced that despite its price tag, it would reduce the federal deficit by slowing the rate of health-care spending.
On Oct. 13, 2009, the committee voted to approve the legislation. The vote was 14 to 9, with all Republicans opposed except for Senator Olympia J.  Snowe of Maine. Two weeks later, Ms. Snowe’s support was lost, when Mr. Reid, the majority leader, announced he would include a public option in the legislation he took to the Senate floor.
The House Bill Passes
Before Speaker Pelosi put the House bill to a vote, she had to broker a series of compromises that ultimately brought along just enough support from conservative Democrats to win passage. The biggest changes concerned the public option plan, which would have to negotiate rates just as private insurers do, rather than offering a rate set slightly above what Medicare pays; the plan would also confront strict controls on abortion. After heavy lobbying by Catholic bishops, the measure was amended to tighten restrictions on abortion coverage in subsidized plans bought through the insurance exchanges, to insure that no federal money was used to pay for an abortion. Both changes angered Ms. Pelosi’s base of liberal Democrats, but they chose to support the bill nonetheless.
Democrats said the House measure — paid for through new fees and taxes, along with cuts in Medicare — would extend coverage to 36 million people now without insurance while creating a government health insurance program. It would end insurance company practices like not covering pre-existing conditions or dropping people when they become ill. And despite its price tag, they pointed to an analysis by the Congressional Budget Office that said it would reduce the deficit over the next 10 years.
In a sign of potential difficulties ahead, some centrist Democrats said they voted for the legislation so they could seek improvements in it in a conference with the Senate.
The Senate’s Merged Bill
By early November 2009, the broad outlines of the bill Senator Reid would introduce on the Senate floor were clear — it would include the public option that was part of the health committee’s bill, but with an “opt out’' provision for states, and many of the taxes and fees written in to the Finance Committee’s version.
Though broadly similar to the House bill, Mr. Reid’s proposal differed in important ways. It would, for example, increase the Medicare payroll tax on high-income people and impose a new excise tax on high-cost “Cadillac health plans” offered by employers to their employees. Mr. Reid’s bill would not go as far as the House bill in limiting access to abortion. And while he would require most Americans to obtain health insurance, he would impose less stringent penalties on people who did not comply.
The official cost analysis released by the nonpartisan Congressional Budget Office showed that Mr. Reid’s bill came in under the $900 billion goal suggested by Mr. Obama. But 24 million people would still be uninsured in 2019, the budget office said. About one-third of them would be illegal immigrants.
The Congressional Budget Office  said the House bill would reduce deficits by $109 billion over 10 years and cover 36 million people, but still leave 18 million uninsured in 2019.
Passage in the Senate
As debate began, Mr. Reid began searching for changes that could pull together the 60 votes that would be needed to avoid a Republican filibuster. The Democratic caucus contains 60 members, including two independents, but one of those independents, Joseph I. Lieberman of Connecticut, said he would block a vote on any bill containing a public option. To win his vote, it was dropped, as was a compromise proposal to expand Medicare to allow people aged 55 to 64 to buy in to the plan — both moves that angered the Senate’s liberals, who pointed out that Mr. Lieberman had spoken in favor of the Medicare expansion three months before.
The last  Democrat to come on board was Senator Ben Nelson of Nebraska, who won a series of changes: a provision to strip the insurance industry of its anti-trust exemption was dropped; language was added to allow states to decide to block plans covering abortion from their insurance exchanges; and the bill now provides Nebraska with additional Medicaid funds.
Republicans vowed to use every parliamentary device at their disposal to slow the measure, which they said was being rammed through the Senate in an unseemly rush. But with Mr. Nelson on board, Mr. Reid’s bill survived the first serious procedural hurdle by reaching the 60 vote mark needed to fend off a filibuster.
When the roll for the final vote was called at 7:05 a.m. on Dec. 24, 2009, it was a solemn moment. Senators called out “aye” or “no.” Senator Robert C. Byrd, the 92-year-old Democrat from West Virginia, deviated slightly from the protocol. “This is for my friend Ted Kennedy,” Mr. Byrd said. “Aye!”
The 60-to-39 party-line vote came on the 25th straight day of debate on the legislation.
An Upset and a Scramble
But less than a month later, the victory of Scott Brown, a previously little known Republican state senator, in the Massachusetts special election to fill Mr. Kennedy’s seat, upset all calculations and left Democrats scrambling for approaches that might allow them to pass some version of the bill.
The most widely discussed approach called for the House to approve the Senate bill — thereby avoiding a filibuster if the Senate needed to vote on a compromise bill. That vote would be preceded by the passing of a separate bill containing the changes both houses could agree to. Democratic leaders believed that most of those could be put into a so-called budget reconciliation bill, which under Senate rules cannot be filibustered. But House Democrats were reluctant to move until the Senate moved first, and several conservative Democrats said they opposed using reconciliation. In mid-January 2010, Mr. Reid and Ms. Pelosi signalled that they did not expect quick action.
In his State of the Union address to Congress, delivered on Jan. 27, 2010, Mr. Obama called on Congress to finish the job. He appealed once more for Republicans to put forward ideas that could lead to a bipartisan approach. He added, “Do not walk away from reform. Not now. Not when we are so close. Let’s find a way to come together and finish the job for the American people.”
But he did not lay out his preferences for the bill’s final form or lay out a means of passage. Almost two weeks later, in an interview during the Super Bowl’s pre-game show, Mr. Obama announced a bipartisan, half-day summit at the White House, a high-profile gambit that would allow Americans to watch as Democrats and Republicans tried to break their political impasse. The plan would put Republicans on the spot to offer their own ideas on health care and show whether both sides were willing to work together.
Republican Health Ideas
Republicans never offered a unified health care bill, but the party’s Congressional leaders sketched out a fairly well-developed set of ideas intended to make health insurance more widely available and affordable, by emphasizing tax incentives and state innovations, with no new federal mandates and only a modest expansion of the federal safety net.
The Republicans rely more on the market and less on government. They would not require employers to provide insurance. They oppose the Democrats’ call for a big expansion of Medicaid, which Republicans say would burden states with huge long-term liabilities.
While the Congressional Budget Office has not analyzed all the Republican proposals, it is clear that they would not provide coverage to anything like the number of people — more than 30 million — who would gain insurance under the Democrats’ proposals.
But Republicans say they can make incremental progress without the economic costs they contend the Democratic plans pose to the nation. As one way to encourage competition and drive down costs, Republican members of Congress want to make it easier for insurance companies to sell their policies across state lines, an idea included in a limited form in the Democratic bills.
President Obama’s Plan
On Feb. 22, 2010, days before his health “summit’' meeting with Republicans, Mr. Obama released a detailed set of proposals. The bill was intended to achieve Mr. Obama’s broad goals of expanding coverage to the uninsured while driving down health premiums and imposing what the White House called “common sense rules of the road” for insurers, including ending the unpopular practice of discriminating against people with pre-existing conditions. It would offer more money to help cash-strapped states pay for Medicaid over a four-year period, and, in a nod to concerns among the elderly, end the unpopular “donut hole” in the Medicare prescription drug program.
In many respects, Mr. Obama’s measure looked much like the version the Senate passed on Christmas Eve 2009. But there are several critical differences that appear designed to appeal to House Democrats, who have voiced deep concerns about the Senate measure and its effects on the middle class.
To begin with, Mr. Obama would eliminate a controversial special deal for Nebraska — widely derided by Republicans as the “cornhusker kickback” — that called for the federal government to pay the full cost of a Medicaid expansion for that state. Instead, the White House would help all states absorb the cost of the Medicaid expansion from 2014, when it begins, until 2017.
And while the president adopted the Senate’s proposed excise tax on high-cost, employer sponsored insurance plans, Mr. Obama made some crucial adjustments based on an agreement reached in January 2010 with organized labor leaders, while also trying to avoid the appearance of special treatment for unions. Most crucially, the president would delay imposing the tax until 2018 for all policies, not just for health benefits provided through collectively-bargained union contracts.
The Health Care Summit
On Feb. 25, Congressional Democrats and Republicans joined Mr. Obama at Blair House, across the street from the White House, for an extraordinary seven-hour televised debate on the intricacies of heath care reform.
Mr. Obama and his fellow Democrats tried to make the case that the two parties were closer than they thought, with the implication that their bill was centrist and would be acceptable to mainstream voters. Republicans countered that the gap was vast, that the bill was out of touch with what the country wanted and that Mr. Obama should throw it out and start over.
Republicans said there was no way they would vote for Mr. Obama’s bill, and Democrats were talking openly about pushing it through Congress on a simple majority vote using the controversial parliamentary maneuver known as reconciliation.
Beyond the question of government intervention in the private insurance market, their most profound disagreement was over expanding coverage to the uninsured. The Democrats wanted to cover more than 30 million people over 10 years; Republicans said the nation could not even afford the entitlement programs, like Medicare, that already exist, much less start new ones.
Final Passage
For most of 2009, the focus had been on the Senate, where the need for 60 votes to defeat a certain Republican filibuster had appeared to put the push for health care reform in greatest peril. But the two-track plan adopted by Democratic leaders — having the House pass the Senate plan with an agreed upon “sidecar’' of fixes — meant that the only new vote the Democrats would have to win would be on a set of fixes that would fall under budget reconciliation rules, making the issue immune to filibuster.
Republicans railed against the tactic, saying Democrats were using a procedural gimmick to “jam’' the legislation through; Democrats replied by listing all the major bills the Republicans had passed via reconciliation when they were in the majority, including the Medicare drug plan and both Bush tax cuts.
Mr. Obama, who had long avoided setting out a definitive set of his preferences, moved to the forefront after laying out an 11-page plan for changes to the Senate bill. The focus swung to Democrats in the House. Some conservative Democrats were unhappy with the bill’s cost, others with the weaker abortion provisions in the Senate bill. A number of liberals were angry over the loss of the public option.
A week after the health care summit, Mr. Obama bluntly challenged wavering Democrats to step up and support the bill, saying its failure would pose a greater political threat than passage. As he traveled to the districts of crucial representatives, Ms. Pelosi and her aides met almost nonstop with members of her caucus.  Three days before the vote the tide seemed to swing her way, as the Congressional Budget Office declared the bill would reduce the deficit by $138 billion over its first 10 years, and a number of anti-abortion Democrats decided that the language in the Senate bill would protect against the use of federal funds to  pay for abortion. But it was not until the morning of the vote, when Representative Bart Stupak of Michigan, who had become a leader of anti-abortion Democrats on the issue, said that Mr. Obama’s promised executive order would settle the issue for him, that it became clear that the bill would in fact pass.
After the House passed the Senate’s bill, it passed and sent to the Senate the so-called “sidecar’' of fixes, which removed some provisions that had drawn criticism, such as a special deal on Medicaid for Nebraska, and adjusted other provisions that were unpopular with House Democrats, like the excise tax the Senate had imposed on high-cost insurance plans. In the Senate, Republicans succeeded in forcing Democrats to make minor changes in the language of the reconciliation bill, which also included an overhaul of the federal student loan program, meaning it needed to go back to the House for final passage, which it gave in a brisk session on the evening of March 25th.
The final House vote was 220 to 207, and the Senate vote was 56 to 43, with the Republicans unanimously opposed in both chambers.
Regulatory Steps
In the first 18 months after the law’s passage, some important provisions were put in place, including tougher oversight of health insurers, the expansion of coverage to one million young adults and more protections for workers with pre-existing conditions.
More broadly, a combination of the law and economic pressures has forced major institutions to wrestle with the relentless rise in health care costs.
From Colorado to Maryland, hospitals are scrambling to buy hospitals. Doctors are leaving small private practices. Large insurance companies are becoming more dominant as smaller ones disappear because they cannot stay competitive. States are simplifying decades of Medicaid rules and planning new ways for poor and rich alike to buy policies more easily.
Even though critics say the law does little to reduce the costs of care, its passage touched off myriad efforts to pare widespread waste.
And by November 2011, Federal officials had awarded nearly $516 million to states to help build new insurance exchanges, although some states whose officials are opposed to the law, like Florida and Alaska, have either refused the money or postponed any plans in hopes of getting the legislation overturned.
Even without a significant expansion of Medicaid for the exchanges, state programs will soon be transformed through a provision that tries to standardize some of the byzantine eligibility and other rules. It requires states to offer a single, simple Internet application for not only Medicaid recipients but everyone seeking care on health exchanges.
But an inspector general’s report from the Treasury Department indicated that fewer small businesses than expected had taken advantage of a tax credit under the law that encourages providing coverage for employees.
Republican Attempts to Repeal

In the November 2010 elections, Republicans took back control of the House and cut the Democratic majority in the Senate. After a delay caused by the shooting of Representative Gabrielle Giffords in Tucson, Ariz., the House voted on January 19, 2011 to repeal the health care overhaul, marking what the new Republican majority in the chamber hailed as the fulfillment of a campaign promise and the start of an all-out effort to dismantle President Obama’s signature domestic policy achievement.
The House vote was the first stage of a Republican plan to use the party’s momentum coming out of the midterm elections to keep the White House on the defensive, and will be followed by a push to scale back federal spending. In response, the administration struck a more aggressive posture than it had during the campaign to sell the health care law to the public. With many House Democrats from swing districts having lost their seats in November, the remaining Democrats held overwhelmingly together in opposition to the repeal.
Knowing that a full-scale repeal would be blocked by the Senate and Mr. Obama, Republicans say they will try to withhold money that federal officials need to administer and enforce the law.
Republicans also intend to go after specific provisions, including requirements that many employers to offer insurance to employees or pay a tax penalty and that most Americans obtain health insurance.  Alternatively, Republicans say, they will try to prevent aggressive enforcement of the requirements by limiting money available to the Internal Revenue Service, which would collect the tax penalties.
The repeal effort is part of a multipronged systematic strategy that House Republican leaders say will include trying to cut off money for the law, summoning Obama administration officials to testify at investigative hearings and encouraging state officials to attack the law in court as unconstitutional. For House Republicans, a repeal vote would also be an important, if largely symbolic, opening salvo against the president, his party and his policy agenda.
Republicans denounced the law as an intrusion by the government that would prompt employers to eliminate jobs, create an unsustainable entitlement program, saddle states and the federal government with unmanageable costs, and interfere with the doctor-patient relationship. Republicans also said the law would exacerbate the steep rise in the cost of medical services.
For their part, the Obama administration and Democrats, who largely lost the health care message war in the raucous legislative process, see the renewed debate as a chance to show that the law will be a boon to millions of Americans and hope to turn “Obamacare” from a pejorative into a tag for one of the president’s proudest achievements. Democrats argue that repeal would increase the number of uninsured; put insurers back in control of health insurance, allowing them to increase premiums at will; and lead to explosive growth in the federal budget deficit.
Republicans said their package would probably include proposals to allow sales of health insurance across state lines; to help small businesses band together and buy insurance; to limit damages in medical malpractice suits; and to promote the use of health savings accounts, in combination with high-deductible insurance policies.
Republicans also want to help states expand insurance pools for people with serious illnesses. The new law includes such pools, as an interim step until broader insurance coverage provisions take effect in 2014, but enrollment has fallen short of expectations. They have also proposed allowing people to buy insurance across state lines and to join together in “association health plans,” sponsored by trade and professional groups.
But state insurance officials have resisted such proposals, on the ground that they would weaken state authority to regulate insurance and to enforce consumer protections — a concern shared by Congressional Democrats.
Mr. Obama has responded to criticism by saying he would be willing to amend portions of the law. On Feb. 28, 2011, he endorsed bipartisan legislation that would allow states to opt out earlier from a range of requirements, including the mandate, if they could demonstrate that other methods would allow them to cover as many people, with insurance that is as comprehensive and affordable, as provided by the new law. The changes must also not increase the federal deficit.
If states can meet those standards, they can ask to circumvent minimum benefit levels, structural requirements for insurance exchanges and the mandates that most individuals obtain coverage and that employers provide it. Washington would then help finance a state’s individualized health care system with federal money that would otherwise be spent there on insurance subsidies and tax credits.
Prospects for the proposal appear dim. Congress would have to approve the change through legislation, and House Republican leaders said that they were committed to repealing the law, not amending it. Even if the change were approved, it could be difficult for states to meet the federal requirements for the waivers.
Scrapping Long-Term Care Coverage
In October 2011, the Obama administration announced that it was scrapping a long-term care insurance program created by the new law because it was too costly and would not work.
The program, known as Community Living Assistance Services and Supports, or Class, was intended for people with chronic illnesses or severe disabilities who wanted to live in the community, though benefits could also have been used to help pay for nursing home care or assisted living.The program would have been financed with premiums paid by workers, through voluntary payroll deductions, with no federal subsidy. Premiums were supposed to have ensured the solvency of the program over 75 years.
But Kathleen Sibelius, secretary of health and human services, said she had concluded that premiums for the program would be so high that few healthy people would sign up.
She said she agreed with actuaries who feared that “not enough young, healthy people” would enroll. “This could have led to a vicious cycle where premiums would have to be set higher and higher to cover the likely costs of benefits, leading fewer and fewer healthier people to sign up for the program,” she said.
Court Challenges
Immediately after Mr. Obama signed the bill, states began filing challenges to it in federal court. Twenty states, led by Attorney General Bill McCollum of Florida, a Republican who is running for governor, banded together to file suit in federal district court in Pensacola, Fla. The first challenge to make it to a hearing was the one filed by the attorney general of Virginia.
In October, a federal judge in Detroit became the first to rule on the lawsuits, upholding the government’s position. The next month, a federal judge in Lynchburg, Va., did the same.
Then in December, a federal judge in Richmond issued the first ruling against the law, calling the individual mandate unconstitutional. The judge, Henry E. Hudson, who was appointed by President George W. Bush, wrote that his survey of case law “yielded no reported decisions from any federal appellate courts extending the Commerce Clause or General Welfare Clause to encompass regulation of a person’s decision not to purchase a product, not withstanding its effect on interstate commerce or role in a global regulatory scheme.”
The case centered on whether Congress has authority under the Commerce Clause to compel citizens to buy a commercial product — namely health insurance — in the name of regulating an interstate economic market. Plaintiffs in the lawsuits argue there effectively would be no limits on federal power, and that the government could force people to buy American cars or, as Judge Hudson remarked at one hearing, “to eat asparagus.”
The Supreme Court’s position on the Commerce Clause has evolved through four signature cases over the last 68 years, with three decided since 1995. Two of the opinions established broad powers to regulate even personal commercial decisions that may influence a broader economic scheme. But other cases have limited regulation to “activities that have a substantial effect on interstate commerce.”
A major question, therefore, has been whether the income tax penalties levied against those who do not obtain health insurance are designed to regulate “activity” or, as Virginia’s solicitor general, E. Duncan Getchell Jr., has argued, “inactivity” that is beyond Congress’ reach.
Justice Department lawyers responded that individuals cannot opt out of the medical market, and that the act of not obtaining insurance is an active decision to pay for health care out of pocket. They say that such decisions, taken in the aggregate, shift billions of dollars in uncompensated care costs to governments, hospitals and the privately insured.
In January 2011, Judge Roger Vinson of Federal District Court in Pensalcola, Fla., became the second to rule against the health care law. His ruling came in the most prominent of the more than 20 legal challenges mounted against some aspect of the sweeping health law.
Only Judge Vinson has declared the entire act void, including provisions that have already taken effect, like requirements that insurers cover children regardless of pre-existing conditions. Three other federal judges, meanwhile, have upheld the law.
In June 2011, a two-judge panel of the appeals court for the Sixth Circuit upheld the law, in what was the first of three appellate decisions.
As they look ahead to the Supreme Court, the law’s defenders can take encouragement from the concurring opinion written by Judge Jeffrey S. Sutton, an appointee of President George W. Bush, a Republican. Judge Sutton is typically considered conservative on questions of constitutional reach.
After acknowledging the difficulty of pinpointing the limits on Congress’s power to regulate interstate commerce, Judge Sutton wrote, “In my opinion, the government has the better of the arguments.” He added, “Not every intrusive law is an unconstitutionally intrusive law.”
Concerning the mandate, Judge Sutton added, “Inaction is action, sometimes for better, sometimes for worse, when it comes to financial risk.” Whether an individual buys an insurance policy or not, the judge wrote, “each requires affirmative choices; one is no less active than the other; and both affect commerce.”
In August 2011, a divided three-judge panel of the 11th Circuit Court of Appeals struck down the so-called individual mandate, which is considered the centerpiece of the law, ruling that Congress exceeded its powers to regulate commerce when it decided to require people to buy health insurance. But the court held that while that provision was unconstitutional, the rest of the wide-ranging law could stand.
In September 2011, a federal appellate court in Richmond, Va., threw out a pair of cases challenging the constitutionality of the Affordable Care Act, ruling for varying reasons that the plaintiffs did not have legal standing to sue. In the process, two of the three judges on the panel volunteered that they would have upheld the law if they had been able to rule on the substance of the cases.
The Supreme Court Steps In

On Sept. 28, the Justice Department asked the Supreme Court to review the decision from the 11th Circuit invalidating the mandate.
On Nov. 14, the court agreed to hear a challenge to the law. The development set the stage for oral arguments by March and a decision in late June, in the midst of the 2012 presidential campaign. The development set the stage for oral arguments by March and a decision in late June, in the midst of the 2012 presidential campaign.
The court’s decision to step in had been expected, but the order answered many questions about just how the case would proceed. The court scheduled five and half hours of argument instead of the usual one, a testament to the importance of the case, which has as its center an epic clash between the federal government and the 26 states that together filed a challenge to the law.
The justices will hear two hours of argument on whether Congress overstepped its constitutional authority, 90 minutes on whether the mandate may be severed from the balance of the law if Congress did go too far, and an hour each on the Medicaid and Anti-Injunction Act questions.
The court will hear three appeals, two from challengers to the law and a third from the Obama administration. The appeals involving the 26 states is Florida v. Department of Health and Human Services, No. 11-400. A second challenge, from a business group and two individuals, is National Federation of Independent Business v. Sebelius, No. 11-393.
The federal government’s appeal is Department of Health and Human Services v. Florida, No. 11-398.


(source: http://topics.nytimes.com/top/news/health/diseasesconditionsandhealthtopics/health_insurance_and_managed_care/health_care_reform/index.html)