CommunityThe Bullpen

Large Portions of Obamacare Likely to Survive Regardless of Court Ruling

The Supreme Court arguments on the first day of the Affordable Care Act have ended; we’ll have audio of the day’s proceedings soon. Jon Cohn was in the courtroom, and his snap reaction was that the “Justices seemed skeptical of tax argument, and argument that anti-injunction act should block case.” If the mandate isn’t a tax, then the Anti-Injunction Argument doesn’t apply to the case. In other words, we will probably see a ruling on the merits, sometime in June of this year.

It’s worth noting that, if the Court rules on the merits, and even if they find the individual mandate unconstitutional, a good deal of the health care law would survive anyway. There’s one way that’s not the case; if the Court rules the mandate unseverable from the overall law, in which case it all gets taken down. But I don’t think anyone really expects that outcome. One of the clearest signs of this is that the insurance companies are making their preparations, almost two years before the exchanges take effect:

The nation’s big insurers are spending millions to carry out President Barack Obama’s health care overhaul even though there’s a chance the wide-reaching law won’t survive Supreme Court scrutiny.

It’s not that health insurers want to bet big that the court will uphold the Affordable Care Act. It’s that they can’t afford not to. It will take at least several months and lots of resources for insurers to prepare to implement key elements of the law, which includes a controversial requirement that most Americans have health insurance by 2014.

WellPoint Inc., the nation’s second-largest health insurer with 34 million members, has said it will spend $100 million this year on technology upgrades to meet the law’s requirements. Aetna Inc., third-largest U.S. health insurer with more than 18 million members, says it expects to spend $50 million this year in part to upgrade software and computers.

Even smaller insurers like Blue Cross Blue Shield of Michigan, a private company with 4 million members, are spending big. This year, the company, which employs 7,000 people, plans to add about 100 employees and spend nearly $20 million.

They cannot afford to wait, but I think the doubt of an aggressive and wholesale tossing of the law is factoring into this as well.

Moreover, Ezekiel Emanuel argues that many of the provisions that don’t involve the insurance industry would survive even if the insurance regulations are seen as not severable:

I believe the mandate is constitutional, but no matter how the court rules, many health care reforms that were approved by Congress through the Affordable Care Act and other recent bills — like those to promote electronic health records, encourage coordinated care, reduce medical errors and cut costs — will proceed.

Tens of thousands of Americans die because of hospital-acquired infections every year, and far more are harmed by medical errors. Last year, authorized by the Affordable Care Act, the Obama administration announced a $500 million program called Partnership for Patients aimed at reducing hospital-acquired infections, errors and other preventable complications. The act also requires Medicare to begin posting online each hospital’s rate of certain medical errors and infections, and to cut payments to hospitals with the highest rates.

Consequently, hospitals across the country are working to reduce preventable hospital errors. Once it’s clear that this is a major priority, significant progress can be made.

He adds that regulations on Medicare readmissions to the hospital, accountable care organizations, bundled payments, electronic medical records (funding for which came from the stimulus package, not Obamacare) and a host of other delivery system reforms are likely to survive, if only because they are in process now, and according to Sarah Kliff they are proving to be money-savers. This has the potential to reduce system costs while maintaining a standard of care. And the mandate has little to do with that.

What this means is that, irrespective of the decision on the mandate, health care may improve with the advent of Obamacare, at least as a sustainable system that is more efficient. This tends to undercut the idea of a life-changing struggle at the court or in the upcoming election. If the delivery system reforms save money and allow for more quality care, nobody’s likely to argue with them.

Previous post

The Supreme Court Should Probably Punt on the Affordable Care Act

Next post

Maryland's Statewide Transgender Rights Bill Dies in Committee Despite Tremendous Successes at the Local Level

David Dayen

David Dayen