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Entries in employer-provided health insurance (1)

Monday
Apr022012

The Possibility of a Nuanced Ruling

Most media focused last week on oral arguments before the U.S. Supreme Court on the controversial federal health insurance mandate for individual Americans. However, justices also heard arguments on other aspects of the legal challenge to what has become known as ObamaCare that could lead to a more nuanced decision and perhaps even more complexity for states.

Justices listened to arguments on whether the constitutional challenge of the individual mandate is ripe because it hasn't gone into effect yet. Commentators expressed doubt the court would effectively punt a big decision for this reason. They also considered the severability of the federal health care reform act. They wanted to know if voiding the individual mandate would void the popular ban on excluding health insurance because of pre-existing conditions. 

A ruling isn't expected until late June, which will allow for a lot of media speculation, political bombast and unease by state officials who will play a key role in implementing health care reform in whatever form it survives from the court case.

Based on the intense questioning by justices and the balky performance of the U.S. attorney arguing the government's case, you could easily conclude the federal individual health insurance mandate is in trouble. The court seems clearly split, but the split echoing from the questioning suggests at best a 5-4 rejection of the mandate.

However, the mandate underpins a grander bargain. Creating the largest possible pool of people with health insurance coverage gives health insurers the ability to absorb and spread costs, including from new insureds who may be combating cancer or suffering from a chronic disease. Dispatching the mandate could put even more pressure on health insurance premiums, which are continuing to rise. That, in turn, could erode the quality of existing employer-provided health insurance and, in some cases, cause employers to drop coverage for employees altogether.

The unspoken part of the story crowded out by commentary on the mandate is what happens if we return to the status quo before Congress approved ObamaCare. The truth is, that status quo has disappeared. 

  • The exclusion of pre-existing conditions and expansion of family coverage to children up to age 26 are very popular provisions, which few would want to lose — especially in an election year.

  • Many employers facing stiff domestic and international competition are looking for ways to trim their health insurance costs. One way is to hire temporary workers without benefits.

  • The public safety net has more holes in it, as Medicaid participation has been limited and funding cut for public health care clinics.

  • Heath care technology continues its steady march ahead, opening new diagnostic and treatment options and adding more costs.

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