Today the United States Supreme Court ruled that the individual mandate provision of the Patient Protection and Affordable Care Act (PPACA) is constitutional. That mandate generally requires most individuals to maintain minimum health coverage for years beginning after December 31, 2013 or pay a penalty. In its decision, the Court, by a 5-4 margin, concluded the mandate was a valid exercise of the Constitution’s Tax Clause which gives the Congress the authority to tax. The Court found that the mandate did not meet the Constitution’s Commerce Clause or the Necessary and Proper Clause, but the impact of failing them has no negative impact because the law is constitutional under the Tax Clause.
With regard to the provision that requires the states to adhere to various eligibility and other requirements for Medicaid or risk losing their funding, the Court also found that provision constitutional as long as the states would only lose new funds rather than all of their funding if they didn’t comply.
Undoubtedly, there will be debate, analysis and political rhetoric surrounding the Supreme Court’s decision. As developments unfold, we will keep you apprised of the major ones affecting your business and personal situation.