Individual Mandate

Various groups, including the Attorneys General of twenty-six states, the National Federation of Independent Businesses, and several individuals, have sued the federal government over parts of the Affordable Care Act. Specifically, they've alleged that the mandate requiring individuals to purchase health insurance is unconstitutional -- it overreaches the enumerated powers of the federal government. The case was recently accepted by the Supreme Court, with oral argument scheduled for March and a decision likely by the end of June. If the Court accepts the plaintiffs' arguments, they could strike down the individual mandate (which could create huge moral hazard problems and be catastrophic for the insurance industry) or strike down the law in its entirety.

As the excitement builds for the coming arguments, Meghan McCarthy of the National Journal issued a call for opinions and predictions on the final fate of the individual mandate. Here's our take:

The final ruling on the individual mandate is tough to forecast, but we're fairly confident that the Court will not strike it down. The challenge is based on whether Congress's power to regulate interstate commerce extends far enough to allow the federal government to require all citizens to purchase health insurance or pay a penalty.

The ruling will depend in part upon how the Court sees uninsurance: is it an active choice for an individual to go bare, in effect to self-insure, or is it due to inaction? The precise definition of action and inaction is a bit murky, but here’s how the argument goes. If going without health insurance is inaction, the Court has to deal with the messy question of whether Congress can regulate inaction when it affects interstate commerce. (Throughout the case, opponents of the Commerce Clause justification for the individual mandate have asked the government just how far Congress's power stretches. Their favorite example has been the purchase of broccoli: can Congress require everyone in the country to buy broccoli? So far, the government has not said "no" -- after all, choosing to buy, or not buy broccoli affects a whole series of interstate markets for leafy green commodities. We won't weigh in on the validity of that argument, but we agree with the Cato Institute's Ilya Shapiro that the government's inability to establish a limiting principle for the Commerce Clause may prove problematic when this argument reaches the Supreme Court.

We actually don't think the case needs to address the issue of action versus inaction at all. In the case of health care and health insurance, there simply is no inactive choice. Going without health insurance is inherently different from going without broccoli, because everyone has some interaction with the health care system at some point. Even if you choose not to buy health insurance, there is a good chance that you will need health care at some point. You are in a car accident, you get brain cancer, you fall down your stairs and break your leg. Since virtually everyone will, at some point, need  health care (and must therefore have a way to pay for it), choosing to go without private or public insurance is, in fact, choosing to self-insure. Since choosing self-insurance is an action that affects interstate commerce, it's clearly within Congress's power to regulate.

Alternatively, the Court might just accept the notion that the mandate is a tax (since its only enforcement mechanism is a penalty), in which case it is unambiguously within Congressional power. That might be more palatable to Justices uncomfortable with striking down the law, but who also don't believe in the expansive Commerce Clause power that the government's position implies.

Health Wonk Review, Muppet Edition!

Hello all, and welcome to another exciting episode of Health Wonk Review! (Regular readers will note that yes, I used line last time. I have half a mind to make Alistair Cookie the official HWR mascot, here at New Health Dialogue.) In honor of what would have been Jim Henson’s 75^th birthday last week, I bring you the Muppet Edition of Health Wonk Review!

Now, without further silliness, the articles!

Quality Care

Here at New Health Dialogue, we’re exulting in doctors’ acceptance that yes, they do overtreat patients! Now, getting them to accept that money is part of the reason why…

Jonena Relth of Healthcare Talent Transformation draws attention to the cool new physician payment system being tried at Fairview clinics in Minnesota: payments are based on patient satisfaction and health, rather than by the number services provided.

David Williams draws a parallel between diagnosis and management consulting: experienced clinicians need to be wary of “early closure,” and avoid becoming like the “more experienced managers [who] are satisfied with two data points – after all, that’s enough to make a line, [or the partners who] just need one data point – they can assume the slope.”

Jessie Gruman, at the Prepared Patient Forum, wonders if the collaboration between HHS, the Robert Wood Johnson Foundation, Dr. Oz, and others will help Americans learn to pay attention to their medical care and improve communication with their providers.

Chris Langston points out that there are fewer people entering training for geriatric specialties—a workforce that may be critical in addressing the communications issue Jessie discussed.

Last week, we analyzed a comment made by Forbes blogger Avik Roy (@aviksroy) during the Congressional IPAB hearings about Medicaid being worse than having no insurance. Simply put, we (and others such as Austin Frakt) disagree. The recent Oregon study showing increased self-assessed health and medical care usage alone should make a listener skeptical of anyone tossing out throw away lines like "[s]tudies show that health outcomes for many Medicaid patients are worse than those who have no insurance at all," as Roy did in his recent IPAB testimony.

It might seem like the New Health Dialogue and Avik Roy are worlds apart in policy positions, but as with so many things in health reform, unlikely ideological bedfellows abound. Though we disagree on the benefits of public insurance for the poor and the necessity of a failsafe mechanism to constrain health care cost growth (i.e. IPAB), we definitely agree about one thing: repealing the individual mandate is a terrible idea.

The purpose of the individual mandate – generally seen as the most politically divisive part of the Affordable Care Act – is to help insurance companies compensate for the new requirement that they cover everyone, even people with pre-existing conditions. It prevents people from just getting insurance when they get sick, while also broadening the insurance pool to include the young and healthy – traditionally a demographic less likely to buy insurance. This balances the "actuarial risk pool," and keeps insurance plans solvent.

Proponents justify the mandate with the Constitution’s Commerce Clause, which states, “[The Congress shall have Power] To regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes.”  The Commerce Clause serves as the basis for many of Congress’s fundamental activities, including guaranteeing civil rights, monopoly busting, and regulating labor standards such as the minimum wage.

Opponents argue that this novel interpretation of the Commerce Clause results in an unconstitutional regulation of inaction. A “slippery slope” rebuttal is often made, with some arguing that if the government can require the purchase of health insurance, nothing would stop it from requiring everyone buy broccoli or anything else things deemed beneficial to your health.

With Republicans vowing to dismantle the health law and courts wrestling with its constitutionality, some health policy experts are pondering a possible "Plan B" in case the individual mandate – the requirement that everyone get health insurance starting in 2014 – is weakened or struck down.

The Alliance for Health Reform held a session on the political future of the Affordable Care Act today, and here are some highlights (slightly delayed after my netbook went into a deep dark and mysterious hibernation from which it just awoke). All three speakers predicted a three-pronged attack by House Republicans.

Legislative (repeal or repeal and replace or some variant). Appropriations to try to "defund" reform. Neither are likely to succeed. And, third, oversight hearings, repeatedly grilling top Obama administration health officials, which is also a way of fighting what one of the speakers reminded us was the real battle to preserve the benefits of health care -- the battle for the hearts and minds before the next election.

With legal challenges to the health care reform law moving forward, a brief from the New America Foundation's Health Policy Program, The Law Behind Health Reform, explores the legal and Constitutional dimensions of the legislation, with a focus on the individual mandate and penalty for not buying "minimum essential coverage." This brief clarifies the legal arguments and judicial history and concludes that the Obama administration has the law on its side.

With legal challenges to the health care reform legislation moving ahead, we asked Tony Cardona, who did several great guest posts for us over the summer on the legal dimensions of health policy, to write us a longer brief on some of the Constitutional questions -- specifically about the individual mandate and the question about whether the penalty for not buying "minimum essential coverage" is a tax.

In the current political climate, you'd be excused for feeling overwhelmed by the anti-health reform echo-chamber:  Repeal it! Defund it! Refuse it! and Litigate it!  There was good news though for the pro-reform camp when a Michigan federal court judge last week dismissed the argument that the individual mandate is unconstitutional, citing Congress' powers under the Commerce Clause of the Constitution (we explained before here).  But it's far from the last time the Obama administration will have to defend the Affordable Care Act in court. If you need a guide to keep track of the court cases, Brian Beutler at Talking Points Memo put together an excellent piece.

Tony Cardona cut through the legalese on this blog here, here, and here.  With more rulings coming -- we expect a ruling on the multistate case Florida v. Sebelius soon -- knowing your wheat-growers history will be more salient than you might think.

This continues our series of posts on the various constitutional challenges to the individual mandate, by Tony Cardona, an attorney who is doing some work with New America's health policy program. Read his post about the Commerce Clause here.

The President stares out the windows of the Oval Office into a cold January. He can do nothing but wait; it’s now up to the courts. Overwhelmed by a divided Congress and high unemployment, the President looks on as the agenda he muscled through Congress with political savvy is debated and challenged.  Meanwhile, the economy washes slowly and tepidly forward, seemingly on the verge of receding back into the deep, dark water. The law suits begin to surface and the President’s agenda is attacked with concern at best and contempt at worst. Ultimately, it is brought before the Nine. These represent the final judgment not only for the law, but also, possibly, for the President. Everybody waits, not knowing whether Congress has exceeded its powers. Justice Roberts sits in his chamber and drafts his opinion, joined by six other justices. His decision rejects the new Act, declares it invasive of State sovereignty, and finds that Congress has no Constitutional authority to impose such a mandate on the populace. The law is a failure. The President sits down, wondering whether his moment has passed.