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The Justice Department has filed its brief on the question of whether it is constitutional to compel Americans to obtain minimum health insurance, its first legal document explaining the federal government’s case supporting the health reform law in preparation for arguments before the Supreme Court in March.
The 130-page brief filed Jan. 6 adheres to arguments it used in lower courts to support the individual mandate, one of four legal questions that attorneys will argue before the Supreme Court.
Justice will file briefs on the other three legal questions over the next month:
• Jan. 27: To what extent can the individual mandate be separated from the remainder of the law if it is invalidated;
• Feb. 6: Whether the Anti-Injunction Act bars the lawsuit that challenges the insurance coverage mandate before it goes into effect in 2014;
• Feb. 10: Whether Congress exceeded its powers by forcing states to accept an expansion of Medicaid costs and administration under pain of losing Medicaid funding.
The Supreme Court will hear oral arguments March 26, 27 and 28 on the Patient Protection and Accountable Care Act (ACA), which was signed into law in March 2010.
The controversial law calls for greatly expanding the number of Americans who will have access to health coverage by mandating minimum health coverage.
Rulings in lower courts have been split. The largest of the lawsuits pits the attorneys general of 26 states, led by Florida, against the federal government saying Americans cannot be forced to purchase coverage. Those states consider insurance a product that individuals may not want or need, while the federal government has argued that all Americans need medical care at some point, and uninsured individuals rack up billions in uncompensated costs that insurers must pass on to their covered customers.
“The challenge is very much like other challenges to landmark legislations, such as challenges to the Social Security Act or Voting Rights Act,” said a senior administration official, whom the department did not want to name, in a tele-briefing with reporters.
In all of those cases, challengers brought the same kinds of arguments that the statute was unprecedented, and those challenges failed. “We think that the challenge here will fail as well,” the official said.
The Justice brief argues that the health reform law is a response to a national crisis in the healthcare market, an area of overriding national interest. ACA, and in particular the provision for minimum insurance coverage, was a response that was a legal exercise of Congress’ authority under the Constitution’s Commerce Clause, which regulates economic activity.
The minimum coverage provision is necessary and appropriate to assure that the law’s reforms are effective. It also is an exercise of Congress’ constitutional taxing authority, in that it imposes a penalty when tax returns are filed like other penalties in the tax code, according to the brief.
While federal tax incentives have made employer-sponsored insurance the predominant form of private health insurance and the federal government finances health care for elderly, and low income individuals and veterans and their families, there is a regulatory gap in the individual market. Millions of people are unable to afford insurance or obtain it because insurers won’t sell to people with pre-existing medical conditions.
Thirty-seven percent of uninsured patients’ health care costs, totaling $43 billion, are estimated as “uncompensated care” received by uninsured patients but not paid for by them or by a third party on their behalf. This cost-shifting increases the average premium for insured families by more than $1,000 per year.
When people do not have insurance, they still get health care but they often can’t pay the cost out of pocket, which can be extremely high. “People still get care, but the government and people with insurance end up paying more of this cost,” the official said.
ACA bridges the gap to expand insurance and keeps insurers from denying coverage or charging very high premiums. But in order for the reforms to work, ACA requires individuals who can afford it to obtain minimum health insurance coverage or pay a penalty with their tax return.