There is no denying this: it was a big win for Americans. The Supreme Court upheld the Affordable Care Act as constitutional. It even upheld the Mandate, which was the subject of much discussion. Only one portion was ruled to be more narrowly defined: the expansion of Medicaid. This was disappointing, however the provision was not eliminated altogether.
The Mandate was deemed a *tax* and - while people who hate taxes are apoplectic - keep this in mind: From Think Progress
The mandate can indeed be characterized as a tax, as the Court found. But it is not a massive tax hike on the middle class, much less the biggest tax hike in American history. The tax imposed by the individual mandate amounts to either $695 or 2.5 percent of household income for those who don’t have insurance and are not exempt based on income levels. By comparison, the payroll tax cut extension Republicans repeatedly blocked earlier this year would have added 3.1 percentage points to the tax and cost the average family $1,500 a year.
The mandate, meanwhile, would hit a small amount of Americans — somewhere between 2 and 5 percent — according to a study from the Urban Institute. The number could be even lower depending on the law’s success: in Massachusetts, the only state with an insurance mandate, less than 1 percent of the state’s residents paid the penalty in 2009.
As I'm understanding this important point, this mandated tax (as it is now deemed by the Supreme Court) would be collected by the IRS. If people choose to not purchase insurance, those extra monies collected would then offset the increased cost of Medicaid. This is all very interesting. You see, one of the perceived downsides of this ruling was that the ACA overextended itself in its desire to expand Medicaid. Ezra Klein writes
Buried in the Supreme Court’s 193-page decision on the health reform law was one big surprise: States can opt out of the law’s sweeping expansion of Medicaid, significantly reducing the number of Americans who gain insurance.
“Governors and state legislatures have a fundamental decision to make,” said Sue Sherry, deputy director of Community Catalyst, a Boston-based think tank. “They have to decide whether they’ll provide basic health care to their poorest residents.”
The Medicaid expansion is expected to extend health insurance coverage to about 17 million Americans by 2019 by expanding the program to cover everyone below 133 percent of the federal poverty line (about $14,500 for an individual).
What the Supreme Court said today was: States do not have to participate in that part of the law. If they want to leave their Medicaid program as is, there will not be a penalty. What was once a guaranteed insurance expansion is now left to the discretion of the states.
The Affordable Care Act provides financial incentives to entice states into the expansion. The federal government will, for the first three years, cover the entire cost of all these new patients. Usually states have to chip in for some of the cost.
The match, however, starts to decrease in 2017, with the federal government paying 90 percent of the bill. That’s still significant, but may not be enough to entice states already struggling under the weight of growing Medicaid bills.
While disappointing, it gives the state an option to opt in with financial incentives. Keep in mind, though, that the monies collected from people through the mandate will go towards offsetting these costs. It appears there is an incentive for people to be insured. However there is a strange catch that I am seeing here.
The mandate is not enforceable as a crime. It never was
. Those taxes cannot be levyed against people unlike many other taxes (for example: Income tax). It's a minimal tax. Therefore, I think that a lot of people may opt to pay the tax instead of getting insured. As far as Medicaid expansion, what politician could refuse to implement a plan to cover all the state's citizens when the Federal government is promising to pay 100% of the cost (dropping to 90% by 2017, and so on and so on)? Well of course there will be some that will express the desire to opt out -- but even Florida is taking a good look at this. Ezra Klein writes:
I reached out to Florida — one state that has been a stalwart opponent of the law — and was told they’re still looking over the law and weighing their options.
What we do know is this: If a state does not expand its Medicaid program, it would create a “donut hole” in insurance coverage for low-income Americans.
The federal law was written with the assumption that all people living below the poverty line would become eligible for Medicaid. Federal subsidies, therefore, would be unavailable to anyone making less than that — even if the state opts out of the Medicaid expansion.
States can opt into the expansion, with federal assistance and people can opt out of the mandate by paying a tax. That money helps to pay for the Medicaid expansion. In the meantime, I foresee Insurance companies getting less of those uber-healthy people they were counting on for profits. This doesn't bode well for for-profit insurance companies. We already know that there are provisions in the bill that put limits on rate increases. They soon will no longer be able to deny people for a preexisting condition. It does, however, bode well for Americans. It will help out the economy in ways
that people have yet to see. Maybe most of all, it will finally remove so much uncertainty, and employers, insurance companies, and non-profits can finally get down to the business of knowing exactly what to expect and how to implement it. No longer is there ambiguity. Families USA released this statement
“The Affordable Care Act provides such peace of mind by ensuring that:
No one will be denied health coverage or charged a discriminatory premium due to a pre-existing condition, such as children with asthma or diabetes;
People with major health problems, like those in car accidents, will be protected against arbitrary lifetime or annual limits in how much insurance companies will pay for needed care;
Young adults can stay on their parents’ health plans until they turn 26;
Tens of millions of uninsured people will gain health coverage;
Seniors will receive significant Medicare improvements, such as preventive care with no deductibles or copayments, and the big gap in prescription drug coverage will close;
Women will no longer be charged discriminatory premiums; and
Moderate- and middle-income families will receive tax credit subsidies so that insurance premiums are affordable.
“It has taken close to a century to enact meaningful health reform. Now that the Supreme Court has upheld the law, it will become a living reality for all Americans very soon.”
In time, I believe we will have health care for all.