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Government Affairs and Advocacy

Federal Policy Issues

Health Care Reform Law

On Thursday, June 28, 2012, in a landmark 5-4 decision that will impact the nation for decades, the Supreme Court upheld most of the key provisions of the health care reform law (Affordable Care Act) that President Barack Obama signed into law in 2010 — an act of Congress thousands of pages long, containing hundreds of changes costing hundreds of billions of dollars and affecting nearly every American from cradle to grave. 

Today’s ruling by the Justices answered a few principal questions, stemming from a handful of conflicting lower court decisions.  Although the arguments are complex, the questions are straightforward. ACA, including its individual mandate that virtually all Americans buy health insurance, is constitutional. The key provision that 26 states opposing the law had challenged — known as the individual mandate — requires virtually all citizens to buy health insurance meeting minimum federal standards or to pay a fine if they refuse. There were not five votes to uphold it on the ground that Congress could use its power to regulate commerce between the states to require everyone to buy health insurance. However, five Justices agreed that the penalty that someone must pay if he/she refuses to buy insurance is a kind of tax that Congress can impose using its taxing power. Because the mandate survives, the Court did not need to decide what other parts of the statute were constitutional, except for a provision that required states to comply with new eligibility requirements for Medicaid or risk losing their funding. On that question, the Court held that the provision is constitutional as long as states would only lose new funds if they did not comply with the new requirements, rather than all of their funding.

Now there is some degree of certainty with today’s court ruling, and Texas Health Resources expects that there will continue to be challenges to the legislation, and we will continue to work with Congressional lawmakers to improve the law. Texas Health is moving forward with the transformation strategy that we began implementing years before the Affordable Care Act passed in 2010. The most effective health care reform will happen through collaboration at the local level among health systems, physicians, employers and payers. We must inspire change in the way people think about their own health. That is the only way we can improve the health of our people, reform health care and bend the cost curve of health care away from its upward trajectory.

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