The Supreme Court and ACA

by on June 29, 2012 at 7:01 am in Current Affairs, Law, Medicine, Uncategorized | Permalink

I liked Will’s post, these comments from John Cochrane, Ross Douthat, Megan McArdle, and these remarks by Ezra, among others.  See also Krauthammer.  A few points:

1. Trust is higher now, and that is worth something, even if like me you never favored the mandate segment of ACA.

2. Implicit in some of these writings is the notion of “contingent on the fact that Roberts upheld ACA.”  You might have thought ex ante: “I don’t think Roberts should uphold ACA.”  But Roberts is a smart and savvy guy, smarter and savvier than most of us and of course better informed about the Court than just about anyone.  You could have held this view ex ante and still now hold: “Conditional on the fact that Roberts upheld ACA, I should think he did the right thing.”

Hardly anyone employs that line of reasoning, but that is a sign of our irrationality.

3. The Court maximizing or at least defending its prestige is sometimes necessary, even in a well-established constitutional democracy.  The Court is not there to do what you want it to, or even necessarily to do what is right.  Get used to that.

4. You may have noticed that I haven’t blogged the legal challenge to ACA all year.  I think that plenty of what our government does is unconstitutional; just remember back to when an amendment was considered necessary for “The War against Alcohol”.  But I’ve also long considered health care policy a matter to be settled by the legislature not the courts.  Those are the modern rules of the game, for better or worse, and all along I have thought that trying to live outside those rules was a fool’s errand of sorts.

5. The Republican Party, by the way, still doesn’t have a coherent alternative for health care reform, nor do they seem willing to embrace many of the better parts of ACA, such as (partially) deregulating dentistry or the Medicare Advisory Board.  Romney seems to want to replace the mandate with more expensive tax credits.  Furthermore, I believe that many Republican legislators would rather run against an unpopular Obamacare than to have to craft an actual, legislate-able alternative.

6. I still believe the mandate segment of ACA will prove unworkable, but I won’t be expecting the courts to fix that.

7. I don’t vouch for this, but it is an angle I had not considered: “Making the mandate a tax has at least one other effect. It makes repeal easier. Now that the mandate has been deemed taxation, it can likely be jettisoned through use of the reconciliation process — meaning the Senate will need to muster only a bare majority for repeal, not 60 votes.”

8. I do think the Medicaid alterations in the Court’s decision will prove a big deal.  I am well aware that the large federal subsidies mean it still makes financial sense for states to continue with the program and the various extensions embedded in ACA.  But overall the program is not popular, and bringing it into the limelight in this fashion will go a long way toward making that common knowledge.  Most of the coverage extension under ACA came through Medicaid, I saw that as in danger in the first place, and now all the more so.

TallDave June 29, 2012 at 7:29 am

The Republican Party, by the way, still doesn’t have a coherent alternative for health care reform

Well, there are proposals, such as allowing interstate insurance competition, McCain’s plan to put individuals on even footing with employers, etc. But I think the most obvious alternative is to simply undo Obamacare and return to the status quo where states do what they want; the main thing PPACA was supposed to do was give insurance to people who couldn’t get it but that problem turned out to be virtually nonexistent. Only something around 1-2% of American citizens are both unable to afford insurance and ineligible for Medicaid, and even they can’t be refused treatment, and are generally young and healthy anyway. Our system was already the best in the world and the most likely to actually give you healthcare.

Yes, there’s still the problem of future costs, but PPACA arguably made that problem worse, and that’s largely a fiscal problem, where the GOP has the Ryan plan (and the Democrats are so irresponsible they aren’t even budgeting anymore, let alone addressing those long-term debt problems).

Andrew' June 29, 2012 at 7:45 am

But trust is higher, it’s not is a tax, and the economy must improve now that health care has been fixed!!!

Nick June 29, 2012 at 9:35 am

John Goodman and John Cochrane have written extensively about different free market health care reform- but I’m not sure whether Cowen considers them doctrinal republicans or not.

Michael June 29, 2012 at 10:54 am

Yeah, how about Paul Ryan and the entire R contingent in the house? Honestly, I consider Cowen’s assertion hogwash, and buying very dishonest partisan spin. Some details in Ryans plan are far from ideal, but still, its light years from Tyler’s assertion of “no alternative”.

These proposals have all been pushed by R’s in legislation over the past ten years, and all of them have been endorsed by Romney:
-Getting rid of the employer health insurance tax deduction or extending it to individuals
-Premium support models for Medicare and other gov’t HC programs
-Medicaid block grants
-Stronger HSAs (keeping $ there for longer than a year, etc)
-Cross state insurance purchases
-Tort reform
Among others. In particular, I think most dramatically underestimate the impact of #1 and #2 in particular. These are very fundamental structural reforms (cross state purchasing, much less so). Tell most physicians that premium support could mean the end of current RVU structure, and you’d see them get outright giddy. Imagine if relative reimbursement rates were negotiated by the market instead of lobbyists in DC (aka Medicare Advisory Board). egads!

GIVCO June 29, 2012 at 1:03 pm

The European Union doesn’t have a health plan either, they irrationally permit each constituent entity make it’s own choices.

BTW, instead of “The Republican Party, by the way, still doesn’t have a coherent alternative for health care reform” Prof Cowen should’ve written, “I can’t be bothered to spend 6 minutes reading the official GOP platform”.

Andrew' June 29, 2012 at 1:43 pm

I think it is partly falling for the trap that the minority party has a duty to make the sitting president look good by providing him with legislation he will sign. What economically-minded person is going to spend resources to create a signable plan that will not be signed?

dead serious June 30, 2012 at 10:11 am

The stance you outline is unique to the Republican party.

The PJ O’Rourke quote “The Republicans are the party that says government doesn’t work and then get elected and prove it” is spot on.

The GOP is not in the business of creating solutions to real problems; its primary objective is to impede change*.

* Unless by change you mean: introducing more Christian tenets in schools and government, identifying new enemies against which our military industrial complex can warmonger, figuring out how to screw average consumers while maximizing corporate profits, things of this nature.

Lou June 29, 2012 at 9:40 am

And of those 1-2%, the majority were uninsured for less than a year while they transitioned between jobs. It can be thought of as a “frictional” level of uninsurance. One, by the way, that could be solved with portable health insurance, and not necessarily a behemoth new entitlement.

Maybe there’s a failure to recognize the coherent alternative because we’re primed to expect a behemoth and the true answer is deceptively simple. Interstate competition, HSAs, lower coverage requirements that lower costs and let people buy insurance cheaply and independently of their employer.

Ricardo June 30, 2012 at 5:42 am

“Deceptively simple.”

No, Cowen is right: these proposals are certainly “alternatives” but coherent alternatives? Not so much. Portable health insurance is a great idea — in fact, it was included in PPACA in the form of insurance exchanges. But getting portable health insurance without an individual mandate means that you have to have some sort of permanent health insurance contract in place that no company is yet willing to sell. You also have to have some serious plan for dealing with the consequences of adverse selection without just assuming the problem away. Otherwise, the incentives are too great for insurance companies to find ways to jack up premiums or deny coverage for their clients once they start getting old and sick or to be risk-averse and simply refuse to offer insurance to anyone without a stellar health history.

One of the reasons why health insurance in the U.S. is tied to employers and is non-portable is simply that individual insurance sucks. Until free market advocates start acknowledging that fact, there won’t really be any way to move forward on the health care debate and PPACA will become the new status quo by default.

Dale June 29, 2012 at 12:27 pm

TallDave
You (and many others) appear to be addicted to the notion that the US has the best health care system in the world. Surely it is debatable and the evidence is not clear-cut one way or the other. But, a number of the references you provide as evidence are entirely misleading. I’ve reviewed the “evidence” about cancer mortality rates and indeed the US has lower mortality rates – if you measure the number of deaths in relation to the number diagnosed. However, the absolute death rate is roughly the same in almost all developed nations. What is really different is that the diagnosis of various cancers is far higher in the US than elsewhere.

So, this leaves an interesting an important question: do more people in the US (as a percent of the age adjusted population) get cancer (if you stick to prostate and breast cancer, the data is quite clear) or do more people get diagnosed with it in the US? I would think the difference is crucial. Perhaps you don’t care – after all, you know that the US has the best health care system in the world. For me, I want to know whether all of our testing, expenditures, unnecessary treatments, etc. are actually saving people’s lives. Evidence does matter – to me, at least.

Why do you find it so hard to separate fact and opinion? The facts may be in dispute, but it would be better to consider them and debate them than to just debate your favored policies and ignore the facts. And, if you cared about facts, perhaps you’d do a little more research into the sources that you cite.

msgkings June 29, 2012 at 12:58 pm

No use chastising TallDave. Birds gotta fly, fish gotta swim, partisan hacks gotta hack.

Andrew' June 29, 2012 at 1:51 pm

Considering that every one of the justifications for Obamacare have been refuted or turn out to be lies, you guys are pretty funny right here.

All that remains is that somehow if we give democrats what they want we’ll magically get European outcomes. No evidence is presented for that aside from the sheer prima fascia assumption that it’s a no-brainer.

Andrew' June 29, 2012 at 2:10 pm

Heathcare: the only thing that isn’t better with more spending on it…until the government is in charge, then it is.

Andrew' June 29, 2012 at 2:18 pm

Btw, some things have to be said, did you go to TallDave’s web link? He probably didn’t get paid $300,000 to produce the opinion that there is no conceivable alternative to a questionably constitutional mandate…ahem…Gruber…

Dale June 29, 2012 at 2:27 pm

Andrew
You certainly like to go well beyond anything I said. I guess that means you also don’t want to be bothered with evidence – let’s just make assumptions about people’s views and engage in pure rhetoric. You have no idea whether I think we could get European outcomes or whether I even think those are desirable. And, if proponents of Obamacare engage in lies, then you think that is an acceptable reason for opponents to lie as well. Civil discourse is certainly uplifting.

I may be obtuse, but I completely don’t understand your reference to TallDave’s weblink. I went there and don’t know what you mean nor where the $300,000 reference came from.

maguro June 29, 2012 at 8:26 pm

The trick is to get European or Japanese outcomes without European or Japanese demographics.

TallDave June 30, 2012 at 11:29 am

I think the proper response is probably just this.

http://en.wikipedia.org/wiki/File:Graham%27s_Hierarchy_of_Disagreement.svg

TallDave June 30, 2012 at 11:12 am

Oh good, here’s msgkings to once again hilariously attack partisans in the name of nonpartisanship, since he’s incapable of making actual arguments. If only this blog had an ignore button.

TallDave June 30, 2012 at 11:25 am

It’s not really that debatable if you look at the evidence.

Earlier cancer diagnosis saves lives. Again, the central point here is that the United States does more healthcare which you don’t seem to dispute. If much of it is marginal, well, you can say that about nearly all healthcare, if you look at the numbers only antibiotics and vaccines actually have much effect on aggregate LE — but no one wants a healthcare system quite that efficient! There will always be a diminishing-returns tradeoff, and the long-term mortality rate is 100% but few are asking for the Liverpool Pathway to be brought here.

Ricardo June 30, 2012 at 11:44 am

“Earlier cancer diagnosis saves lives.”

How many lives? What medical studies are you basing your assertion on and for which forms of cancer?

TallDave June 30, 2012 at 2:47 pm

I don’t know that anyone has ever done a comprehensive comparison of the U.S. to the rest of OECD that would quantify exactly many lives have been saved by our greater propensity to test (or more accurately, how many life-years, since they all die eventually!) but obviously you can find a bazillion studies showing cancers are generally less fatal when detected sooner, esp before metastasis.

Ricardo July 1, 2012 at 12:36 am

TallDave, the dispute is not about detecting cancer before or after metastasis. It is about detecting low-risk early stage growths and then doing precautionary treatment or surgery. For instance, this article from the National Cancer Institute on prostate cancer notes the “lack of published trials that compared different options head-to-head.”

TallDave July 1, 2012 at 12:59 am

Yes, it’s true there are not published trials for every piece of information we’d like to have. But the study still managed to find “active surveillance” to be more efficient than proton beam therapy.

Now, if only people had more reason to care about the cost difference…

Floccina July 2, 2012 at 2:07 pm

Earlier cancer diagnosis saves lives.

That is not a sure thing. Some say that we in the USA find a lot of harmless cancer (see: Nortin Hadler).

Jamie June 29, 2012 at 3:40 pm

…Ignoring, of course, that this was a Republican plan, from the Heritadge Foundation, that Romney actually implemented. Romney’s parsing is obvious hogwash, and, fine, if you want to say that the ’90s Republican plans were disingenuous dodges to support the current, unworkable state of health care, then just do so. Cowen has – we don’t know where the income line he draws is, but below it, people just die. Apparently, a massively screwed up oligarchy with heavy dependence on government (but not more!) should determine that in mail processing centers (not panels).

Robert’s odd splitting the baby was interesting.

TallDave June 30, 2012 at 11:16 am

It was passed by Massachusetts and the idea was always more popular among the left. The GOP as a whole in this country would never have passed anything like it, and never has in any red state.

Daniel Hoffman June 30, 2012 at 6:14 pm

Tall Dave,

We have 45 million people without health insurance in this county. When you refer to people not being refused treatment is no accurate. What happens is they go to the ER and receive stabilization treatment that cost much more and while they are getting “treatment” you and I are picking up the tab.

Also, we do not have the “best medical system in the world” We pay more per capta and every single outcome is lower then other countries. So, we are paying more for care and getting less out of it. Infant mortality, life expectancy, etc.

We have turned over payment for our care to for profit companies who have no moral obligation to cure us and ever incentive to deny coverage so to preserve a profit margin and return to share holders. While you are singing the praises for this vampires you should consider the overhead for Anthem in Indiana is 30%. For every $1 it takes in only $.70 goes to care. To break that down, $.30 goes to the CEO, stockholders, or some nurse to pore over medical records to find any reason to deny coverage. However, Medicaid and Medicare, the inefficient government run system has only a 3% overhead.

TallDave July 1, 2012 at 12:45 am

The number of people without enough income to afford insurance, who are not eligible for Medicaid, and who are U.S. citizens is closer to 5 million, and most of them are young, healthy, and live in red states.

Clearly you did not read the link, we have the best outcomes (LE is not an outcome! IM is measured differently — other countries let more marginal births die untreated and call them stillbirths) and we pay more primarily because we get far more.

We turned over most of our economy to for profit companies, because it works better than a command economy — which is why the whole world abandoned Communism. Do you suppose the government can run the food sector better than the private sector with all its inefficient profit? The 3% myth ignores the fact the IRS is their collections arm.

Floccina July 2, 2012 at 2:13 pm

or some nurse to pore over medical records to find any reason to deny coverage.
Daniel Hoffman I do not think that you would like a system that just pays for every bill submitted.

Andrew' June 29, 2012 at 7:35 am

Why does one need a coherent alternative to the incoherent alternative?

Orange14 June 29, 2012 at 7:43 am

Because the non-100% healthy individuals need it.

Andrew' June 29, 2012 at 7:47 am

I don’t usually say this, but that’s a dumb comment. You are saying that only 100% healthy individuals benefit from the previous system. I know you can’t mean that. TD says above 98-99% did okay above. Dispute that if you wish, but nonsense is nonsense.

Andrew' June 29, 2012 at 7:55 am

Btw, it’s nonsensical even from their (your?) own rhetoric. The rhetoric is that the young and healthy are free-riding on the system. Your comment implies that the healthy don’t need Obamacare. It’s interesting if you want to have it both ways. Then it really is just a cash transfer from the healthy to pay for the care of the sick.

Orange14 June 29, 2012 at 8:36 am

I use the term “non-healthy 100%” to represent those individuals who rightly or wrongly say ‘I don’t need to buy something that I will never use.’ Of course there is no such thing as a truly ’100% healthy’ individual since it only refers to a period in time, much the same way as the Heisenberg Uncertainty Principle refers to location and speed in particle physics. The blunt fact is that one cannot know when he/she will need health insurance (witness the universal requirement for drivers to carry automobile insurance) since anyone of a myriad of things could happen requiring medical care. Now, assuming you are an individual who is not covered by an employer health plan (which is the real target of the ACA) the question is ‘to buy or not to buy.’ If you are wealthy enough to self-insure (and even many employers do this for their employees; my former employer did this for part of our coverage which I still enjoy as a retiree) you don’t need to worry as long as you have the funds to cover all of your health care costs. However, what about those who are not in that category and incur a significant financial burden as result from even a mild condition (the drug and physician cost for treating mild asthma and allergy is about $2300 per year) so the costs can quickly add up in the absence of insurance. Now if we want as a society to allow ‘risk-adjusted’ underwriting, some individuals will be priced out of the insurance market or require some form of subsidy to be able to afford insurance. If you don’t know anyone who falls into this category, fantastic for you; I on the other hand know a good number of people, both young and pre-Medicare older people who do not and ‘at this point in time’ face large insurance bills for basic coverage.

It is for these people that I have not seen any Republican proposal; only repeal the ACA. It’s fine if the libertarians on this blog want to move to a society where we all ‘fend for ourselves’ in terms of health care. I’m as libertarian as everyone else on almost all social issues; I draw the line here and believe there is a societal responsibility to ‘promote the general welfare’ by providing reasonable healthcare for all.

Andrew' June 29, 2012 at 8:43 am

“individuals who rightly or wrongly say ‘I don’t need to buy something that I will never use.”

People don’t really say that. This is rhetoric.

We know that it is rhetoric because 85% of medical bills come from 25% of patients. So what those people say, who don’t actually say that, are absolutely correct. People want insurance, they just don’t want to be screwed.

However, at the same time it is absolutely true. For example, I will never need an abortion. That took me 1 second. So, even while it is pure rhetoric from your side, the “free-riders” you speak of are 100% right.

Jan June 29, 2012 at 9:13 am

We’ve come far enough as a society to know that when people need emergency health care, they need health care, and we do not turn them away. Use your 80/20 stat all you want–everyone needs health care and, eventually, almost everyone will draw on their insurance.

But what about those people who make up the 80% of health care expenses? How much should they pay? Should they pay 100% of their costs out of pocket? Is the concept of insurance and spreading risk inappropriate for health care? Should everyone just save enough money for when they get sick? When the majority who are cheap health care consumers get sick and become the very expensive it gets a little sticky. And is it just too bad for those people who start out sick and don’t have the chance to save up or can’t get insurance once they are sick?

You can call it as a cash transfer from the healthy, but really it is just insurance. Under the mandate, you cover your own ass. Under no mandate, the taxpayer covers your ass. It seems libertarians and the Heritage Foundation would be more into favorable to people covering their own asses rather than Uncle Sam covering people’ asses.

Orange14 June 29, 2012 at 9:29 am

@Andrew – “We know that it is rhetoric because 85% of medical bills come from 25% of patients. So what those people say, who don’t actually say that, are absolutely correct. People want insurance, they just don’t want to be screwed.”

But I think you are grouping Medicare patients who spend huge amounts of health care $$$s in the last year or two of life and I’m not factoring them into my comment above. The key thing is whether or not to write policies based on pre-existing conditions that may be no fault of the individual (and I’m leaving aside issues related to crappy lifestyle choices such as smoking and obesity which are problems of a different sort).

Your abortion comment is just plain stupid since it’s really not a significant driver of health care costs (and one might successfully argue that it’s better not to bring an unwanted child into this country and all the costs both monetary, physical and emotional that incurs). I don’t know what the % is these days but suspect that most abortions are pharmaceutically induced these days. If you are a true economic libertarian, please read Chapter 4 of Freakonomics and then explain to me why this isn’t a societal benefit (and leave aside the philosophical/ethical/religious issues).

Cliff June 29, 2012 at 9:32 am

Reality tells us that the taxpayers did not cover their ass in the existing system (very low expenditures on uninsured) and will cover their ass under the new system (massive subsidies).

It is NOT insurance, it is a cash transfer from healthy to sick! Real insurance is priced based on your actuarial risk and INCREASES costs. Is home owner’s insurance a transfer from the safe to the dangerous? No, it is real insurance that is based on your individual risk. Safe people are not forced to pay high HOI premiums to subsidize the dangerous. In contrast to health insurance.

TallDave June 29, 2012 at 10:56 am

Jan — red herring. It doesn’t matter if they save or not, they still get treated. No one is ever “out of luck.”

I think it’s fine to say “everyone should get healthcare” but our system already does the best job of that — we provide more healthcare than any other system. The only catch is, occasionally some people are asked to pay for it afterward. That can be very expensive, even ruinous, but it usually beats dying and a true non-employer insurance system would generally mitigate that while allowing some price signals into the system (I went to the doctor today as it happens, and got the usual look of bewilderment when I asked how much a certain esoteric test would cost).

It’s sort of an odd argument to make that health insurance shouldn’t get more expensive as risk increases — do we also expect the terminally ill to get the same rates for life insurance as the healthy? Leaving behind dependents is also quite tragic…

Jan June 29, 2012 at 1:19 pm

It’s not a red herring. I’m not saying people don’t get treated, but they often get treated very poorly if they don’t have consistent care and insurance. The concept is that we all pay for it anyway. So talking about a cash transfer to the unhealthy is meaningless. We have a cash transfer now. It is just a very inefficient cash transfer dictated by emergency room traffic rather than patients and includes vastly different billing rates and medical bankruptcies. You should also recognize that overtreatment of the insured (best health care in the world!), which the ACA aims to cut down on by ending fee for service, is often wasteful and sometimes harmful.

The only way that aggregate risk increases under this reform is if you think all the poor people and free riders without health insurance now don’t get health care and don’t receive it largely paid by the taxpayer, and I know you don’t believe that.

I’m impressed that you self-insure without using a third party company. That takes courage, but you’re also getting much worse prices than everyone else who negotiates prices via their insurer.

TallDave June 29, 2012 at 3:16 pm

They may get worse care but that’s usually because they live in worse neighborhoods with worse hospitals; it’s become just like the problem with public schools. And yes, they do consume fewer healthcare dollars, but again mostly because they tend to be young and healthy.

Self-insurers do not necessarily face worse pricing, it’s just a matter of negotiation. In fact, quite often the opposite result happens, because you have a power that is legally denied your insurer: you can opt for a different, less expensive (and perhaps more effective!) treatment than your doctor recommends. (This is another weird layer of price insulation — your insurer can’t even suggest a cheaper alternative even though they probably have the data to do so.)

The problem is that the system rarely deals with consumer prices at all, so it hasn’t developed any kind of efficient mechanisms to serve price-conscious consumers. This is probably where we can get the most improvement — it wasn’t all that long ago that everyone assumed you couldn’t get Wal-Mart prices at the level of quality they deliver…

Herald June 29, 2012 at 1:26 pm

Andrew, your question is rhetorical, but it is not logical argumentation. Your quip begs the question. But, you are asking why would one need a ‘coherent’ choice if offered an ‘incoherent’ choice.

Suppose you remove the ‘incoherent’ choice, what remains? The idea is incomplete.

Refreshing would be for you to explain what ‘coherency’ in general might be in a health care policy, then score the Romneycare-Obamacare plan versus the current Romney-Republican alternatives, *as well as* the status quo prior to the ACA. The draw a conclusion that people can discuss based on shared assumptions and mutually established facts.

Orange14 June 29, 2012 at 7:42 am

Solid points and I largely agree with everyone of them. We now have the opportunity to see if the private sector insurance industry can step up to the plate, tweak their business model, and deliver the goods. This is not the plan that I would of taken (prefer vouchers for all based on a national sales tax and get all employers off the hook) but probably the only one that could and did pass Congress. As the rhetoric about the Constitutional legitimacy now goes off into the ether, more people will actually look to see how they will benefit from this law. Clearly the young and 100% healthy individuals (if there are any 100% healthy individuals – remember you are one traffic accident or some other catastrophe away from big hospital bills) are net financial losers since they now have to purchase insurance or pay the tax. However, for a lot of the rest of the US populace, insurance is will be affordable and this is the big thing.

Until the Republicans can come up with a viable alternative, the Democrats are in the drivers seat since any attempt to repeal will be a huge political gamble once voters realize what is at stake (and the 100% healthy individual minority won’t hold the day on this one). As to TallDave’s comments above, return to the status quo is a dream as noted, and interstate insurance competition while appealing 10 years ago, is now largely moot since there are only a handful of insurers left who have the financial ability to provide an insurance product. Do you really this in anyway affects Aetna, WellPoint, and the others to compete in the marketplace? Do you really think TallDave Insurance Company can be a health care provider?

Cliff June 29, 2012 at 9:34 am

How will insurance rates be affordable? Because Obama will forbid any rate increases? Rates are going to skyrocket with guaranteed issue, minimum coverage requirements, 26-year-olds on the policy, etc.

Dan Weber June 29, 2012 at 3:48 pm

26 year olds seem the least problematic part of anything. They are incredibly healthy.

Hm, do you stay on your parents insurance if you become a parent yourself?

ila June 29, 2012 at 12:50 pm

The ones who are better off now with this are those who could not get insurance that would pay for their chronic medical condition issued at a rate lower than the expected cost of that care, those 26 and under adults who are out of school, currently unemployed, and whose parents have health insurance, and those who will qualify under the Medicaid expansion (if their state participates). Those who currently have health insurance, those who could but choose not to buy health insurance (a rational person who has enough liquidity to handle a sudden, acute illness might choose not to buy health insurance if he thinks his expected cost is less than the expected benefit), and those involved in markets covered under the new taxes are financially worse off if they are not included in the above group.

Like most subsidies, a small group benefits greatly by extracting a relatively small amount of value from a larger group.

Eric June 29, 2012 at 7:42 am

“1. Trust is higher now, and that is worth something, even if like me you never favored the mandate segment of ACA.”

I wouldn’t have thought it possible, but my trust in the court is actually lower now. I’ve discovered that the Chief Justice of the Supreme Court is willing to deliberately misread a law.

7. I don’t vouch for this, but it is angle I had not considered: “Making the mandate a tax has at least one other effect. It makes repeal easier. Now that the mandate has been deemed taxation, it can likely be jettisoned through use of the reconciliation process — meaning the Senate will need to muster only a bare majority for repeal, not 60 votes.”

The penalty is both a tax (so it isn’t struck down) and not a tax (so the AIA doesn’t apply). Who knows if it’s a tax or not for repeal purposes until there’s a court case and the Chief Justice of the Supreme Court decides how he will misread the law this time. I’m still worried that it will be judged a penalty and not a tax for enforcement purposes when someone runs afoul of it. This is my main objection to this decision. That is, it makes it impossible to decide whether non-compliance is just a simple decision, like my current one to not purchase certain energy efficient items and not receive a corresponding deduction (in which case there will be widespread non-compliance) or whether non-compliance is an actual legal violation

Andrew' June 29, 2012 at 8:33 am

“But Congress did not intend the payment to be treated asa “tax” for purposes of the Anti-Injunction Act. The Affordable Care Act describes the payment as a “penalty,” not a “tax.” That label cannot control whether the payment is a tax for purposes of the Constitution, but it does determine the application of the Anti-Injunction Act. The Anti-Injunction Act therefore does not bar this suit.”

Ah, that makes complete sense now.

Here is a simple question: Dear Mr. Roberts,esquire, are all fines now just taxes?

If so, we can now officially disband the Supreme Court. They serve no purpose.

Right Wing-nut June 29, 2012 at 8:55 am

THIS is the crux of Roberts’ position: what the government cannot do through other means, it can do through taxation. Since the passage of the 16th amendment, Congress has held essentially unbridled power to tax. While I find the income tax REALLY bad policy, I think that having the right is necessary. While conservatives have worried a lot about the commerce clause, Roberts has now eclipsed this with the taxation authority.

I wonder, if Congress were to pass a $100,000 tax on circumcisions, would Roberts have a problem?

Brandon T. June 29, 2012 at 9:06 am

He discusses that in his decision; see the section on child labor.

Eric June 29, 2012 at 9:33 am

The Chief Justice of the Supreme Court does say, in effect, that what the government cannot do through other means, it can do through taxation. He also says, in effect, that taxing is what Congress did. But they explicitly did not do this in the law. If the mandate penalty was in the law as a tax I’d agree that this case was rightly decided. But Congress, not the Court, needs to take the political heat. Since they did not, the law should be thrown out. The dissent is excellent reading on all the reasons why this is not a “tax” according to the written law.

TallDave June 29, 2012 at 10:59 am

The real fun will start when the social-conservative right figures out they can put a 10,000% tax on abortions and Roe v Wade is powerless to stop them.

Brandon T. June 29, 2012 at 11:15 am

No. See Drexel Furniture and Roberts’ use of it on p. 35.

TallDave June 29, 2012 at 3:23 pm

Wrong. If you read on to p.36, he then says Gov’t disagrees with the reasoning on p.35, and he agrees with Gov’t.

So Drexel’s not going to help them, all Congress has to do is say the penalties “shall be assessed and collected in the same manner as taxes.”

MD June 29, 2012 at 4:57 pm

How would a 10,000% tax not violate the first prong of the Drexel test? Wouldn’t it be a “prohibitory” financial punishment for obtaining the procedure?

TallDave June 30, 2012 at 11:37 am

Isn’t the mandate a prohibitory financial punishment for not getting insurance?

Maybe 10,000% would be deemed excessive, but after this decision it’s pretty clear that there’s some level of punitive taxation that is acceptable and that’s going to be very attractive both to a GOP Congress and to red states.

Brandon T. June 29, 2012 at 9:05 am

This is hardly the rhetorical gymnastics people are making it out to be. The initial section is just Robert saying the court has jurisdiction–there’s a lot at stake in this first section, but it doesn’t bear substantively on the rest of his decision.

And, no, he’s not deliberately misleading anything. From the beginning the mandate has walked and talked like a tax but people called it a penalty for political reasons. Roberts is on perfectly good footing both in terms of precedent and legal philosophy in providing an alternative but plausible reading.

I am not crazy about the ACA but libertarian bellyaching about this is misguided. We are not choosing between a free market in health care and the ACA, so we can put our heavy-duty moralizing to the side. Moreover Roberts establishes the first limiting principle–weak as it may be–on the Commerce Clause in a hundred years. Yes, this is a mixed bag, but frankly I don’t feel in the slightest like my rights are any more violated today than they were yesterday, and Court legitimacy is far, far more valuable than a lot of people assume. Look at the Scalia and Ginsburg dissents–both are pathetically hackish and transparently partisan. This type of decision is more dangerous to me, personally, than a tax to pay for health care.

Eric June 29, 2012 at 9:29 am

Yes “people” call it a penalty, but that’s not relevant. What is relevant is that the *LAW* calls it a penalty. I agree that Congress can override past Congresses with regard to the AIA but, as the dissent makes clear, the main time this law refers to a tax, it explicitly states it is not one.

Brian Donohue June 29, 2012 at 10:26 am

good comment.

Think June 29, 2012 at 9:15 am

John Cochrane,

“If the Federal government has the power to adjust your taxes based on whether you buy an electric car, cover your roof with solar panels, use 1 btu of petroleum to create 1 btu of corn ethanol, take out a mortgage on your mansion, hire a nanny to take care of your kids, and all the other silly things it does in the tax code, it surely has the power to adjust your taxes based on whether you buy health insurance.”

“Yes, the administration didn’t call it a tax. But for the court to overturn this whole law, one of the Administration’s proudest accomplishments, based on that technicality would have been petty and political. They did the right thing to look at the big picture.”

Eric June 29, 2012 at 9:50 am

The text of a law is not a technicality. I would agree that the law is Constitutional if the penalty were a tax, but it is explicitly not one in the law. There are other legal ramifications for calling this a “tax” and not a “penalty” and I have no reason to believe that the courts will apply the “tax” definition consistently to all these ramifications. In oral arguments, the question was asked something like this: Suppose someone fails to purchase insurance and pays the penalty. He is asked under oath if he is in compliance will all Federal laws. The government’s lawyers said he should answer “yes”. I’m not a lawyer, but the implication is that he should answer “no” if this were a penalty and “yes” if it were a tax. Am I sure the Court would rule consistently in a perjury trial? Not really. Also, I suspect viewing it as a tax will increase non-compliance. After all, I currently “fail to comply” with the “mandate” to purchase electric vehicles annually and pay for it every year with higher taxes than I would otherwise pay. As does nearly everyone else. And no one considers this at all serious.

Yancey Ward June 29, 2012 at 9:54 am

I think that sounds superficially pleasing, but I think it misses an important distinction. If I don’t put solar panels on my roof or buy an electric car, the government isn’t coming tocollect an additional tax that I must either pay or go to jail. I just don’t get a tax credit/deduction. I only run afoul of the law if I try to collect the credit/deduction and not engage in the designated activity. The mandate-tax functions differently- I must move from a state of inactivity to activity, or I must pay a penalty or go to jail.

Put another way, there really is a difference between taxing someone for not buying health insurance, and taxing everyone equally but remitting a tax credit to those who prove they have purchased health insurance.

anon June 29, 2012 at 12:02 pm

I must move from a state of inactivity to activity, or I must pay a penalty or go to jail.

I doubt anyone will go to jail if they don’t pay the tax unless that is the outcome they are looking for. With that said, the first person who does go to jail for not paying is going to be the test case and a celebrity, and we will likely memorialize their name like we have “Miranda”..

What this decision has done is reduce my respect for “the law” and the rule of law. Partially because now the Supreme Court has directly said that our elected representatives can blatantly lie and misrepresent to the voters what they are doing and and the courts will go along with it. That is not what I would call representative democracy…. (And i fail to see how it increases trust, but then I don’t have a PhD in economics.)

I suspect we are on the road to seeing more tax cheating and faster growth of the underground economy in the US now that we citizens know we can’t trust our elected representatives to mean what they say and say what they mean. I suspect we will also see more acts of “quiet” civil disobedience and the kind of subtle sabotage that raises the cost of government action. Things like not accepting plea bargains, always going to court, paying bills with checks rather than online, etc. etc., etc. There are thousands of very small things people can do to raise the cost of government, over and above increasing public “servant” pensions. Incentives matter.

Norman Pfyster June 29, 2012 at 12:42 pm

“Put another way, there really is a difference between taxing someone for not buying health insurance, and taxing everyone equally but remitting a tax credit to those who prove they have purchased health insurance.”

No, there isn’t. You have described identical states of the world, and also exactly what Congress would have done if ACA had been struck down on the tax argument.

Yancey Ward June 29, 2012 at 1:12 pm

Norman,

Yes, there is a difference, and that difference is why it was done one way and not the other.

Malcom Digest June 29, 2012 at 6:28 pm

@anon – We know that the ACA made non-payment of the fairly innocuous in the sense that there are no criminal liabilities associated, no tax levies are possible, etc.

However do you know that at the end of the year the IRS isn’t going to calculate your total tax liability plus your ACA tax payment then take your total tax payments, apply them to your ACA liabilities first, then put the remainder to your normal tax leaving you short on your tax payments and accompanying criminal results for non-payment.

Bruce Cleaver June 29, 2012 at 11:22 am

“I wouldn’t have thought it possible, but my trust in the court is actually lower now. I’ve discovered that the Chief Justice of the Supreme Court is willing to deliberately misread a law.”

Well that was my reaction too. The unspoken rejoinder to our thinking is: “Among the people who *count*, trust has improved.”

Robert June 29, 2012 at 8:51 am

1) I’m not so sure that trust is higher. Certainly, people who favor the law , i.e. liberals, academics, and journalists, have more trust in John Roberts. They are also the people most likely to have their voices heard. Since the majority of people feel that the mandate is unconstitutional and the court found the law to be constitutional, I would expect that trust would be lower.
2) Isn’t it sad that one needs their favored ruling to believe he did the right thing. I think this statement would have been better: “Conditional on the facts, I should hope he would do the right thing.”
3) I agree with your Marbury assessment.
4) I believe that healthcare should be determined by the states, which will give Americans more options. The centralization of control and power leads to corruption, which we witnessed in the process to get the bill passed and with the recent Axelrod scandal. Realistically, it should be handled by all three branches, but this decision is a lot better than some of the state cases where the court determined the expenditure amounts.
5) I believe this has more to do with who has access to have their voices heard. Also, why should they have a coherent alternative? Isn’t this a political statement than an economic statement? Should the legislature investigate the root causes of the inefficiencies and problems within the system, then deliberate on the solutions to solve those problems? From what I understand, if the government reformed CORBA, it could fix a lot of the problems with people not being people not be insured. I know that was the case when I was laid off. Removing the monopolistic power in this bill would probably be a major benefit. Personally, I believe that the people who could afford to should save money when they are young to pay for their own benefits when they are old, which will have two big benefits. One, people will make wiser choices with their money and health. Two, it will reduce the administrative costs of redistributing the wealth from the young to the old, which is weird since it will be from the poor to the wealthy. The big problem with this idea, is that it will be tempting for the people in power to re-appropriate the money to pay off the people who will keep them in power such as how the government paid for the war with a housing bubble and is going to try to pay for the stimulus.
6) I think you are absolutely correct on this.
7) Reconciliation brought the bill into the world, and this bill will change dramatically over time, just SS, Medicare, Medicaid, and the well-fare reform of the 90’s.
8) I think this is the biggest deal since it will allow for competition between the states.

I worry that economists do not spend enough time thinking about corruption, which leads to misallocation of resources, which leads to lower standards of living for everyone.

Tom June 29, 2012 at 8:56 am

How did those bettors on Intrade predict?

Think June 29, 2012 at 9:17 am

They were 71% the mandate would be repealed

Tomasz Wegrzanowski June 29, 2012 at 11:07 am

It briefly peaked at 80%. Intrade fail.

lxm June 29, 2012 at 9:28 am

They were wrong and lost: http://www.ritholtz.com/blog/2012/06/healthcare-upheld-by-scotus-intrade-blows-it-again/

I agree with comment #5. Especially, “I believe that many Republican legislators would rather run against an unpopular Obamacare than to have to craft an actual, legislate-able alternative.”

There are no good ideologically pure solutions for the health care cost problem in America. And, therefore, it’s easier and apparently pays better to just yell and scream than to actually wrestle with finding improvements.

Cliff June 29, 2012 at 9:37 am

That is an unbelievably foolish statement. 70% means 70% of the time that result will happen. The fact that it did nothappen this time does not mean they “were wrong” or “lost”. It had a 30% probability!

anon June 29, 2012 at 12:05 pm

It had a 30% probability!

Please for the love of G*d do NOT confuse us with math!

LOL

Popeye June 29, 2012 at 4:15 pm

No, it just meant that a certain configuration of payouts was required to clear the Intrade market. No one asked the Oracle of Probability anything.

Cliff June 29, 2012 at 11:34 pm

Well, by a very magical coincidence, the price required to clear a liquid betting market is extremely predictive. The most predictive tool available in almost all cases.

anon June 29, 2012 at 9:18 am

2. boils down to “trust the experts,” which may be rational in theory but is difficult in practice. (I have tried in a different context with limited success.). Experts put a lot of factors in their decisions…the specifics of the issues, the broader implications of their decision, and their own personal take on events. The last two can inject some subjectivity and self interest of the expert that an outsider might rightly quibble with. It seems a bit harsh to call someone irrational if they don’t just accept Roberts’ view, because he’s the expert.

Roy June 29, 2012 at 12:35 pm

Exactly, this reminds me of a bumpersticker I have seen a few times that says:

“The Titanic was built by experts”

Experts who thought they knew more than they did about naval architecture. Experts who didn’t realize that watertight bulkeads need to be higher and that bolted plates are inferior to welded plates, and this was all compounded by experts who didn’t think a full complement of lifeboats were required. The question is who will save us when the experts are wrong. In the late eighteenth century the most expert doctor in the newly born US was Benjamin Rush who despite Harvey’s discovery of circulation of the blood 150 years earlier still believed in bleeding patients, even for blood loss and anemia.

The trouble with rule by experts is sometimes the experts are wrong.

msgkings June 29, 2012 at 1:16 pm

So the alternative is let the dumdums run things?

Reminds me of the movie lines (sadly, can’t remember the movie, paraphrasing):

“So I’m an idiot for not knowing how to cure the patient?”

“No, you’re a freaking genius for not knowing how to cure the patient!”

Roy June 30, 2012 at 1:02 am

No we need democratic oversight over the experts.

When the Titanic sank, the experts were against increasing the number of lifeboats, that wAs forced on them by politicians, as to welding versis rivets, that was corrected by cheaper welding technology from WWI experience, and the bulkheads were not recognized at the time, but improved anyway by politicians after WWI so they could comandeer ships for military purposes.

I am an expert myself, but if an amateur makes a strike against my advice, it will really hurt my business if I don’t pay attention. Non experts are the people who hire me and they want results. If I didn’t constantly outperform water witches and diviners I would be out of a job. My oversight is the market. The only oversight that government experts have are the despised voters.

Rahul June 29, 2012 at 1:52 pm

How many large ships do we know that were built by non-experts?

Andrew' June 30, 2012 at 5:28 am

The risks are internalized if you are employed by the ship-builder.

The first problem with experts is that they are wrong.
http://www.nytimes.com/2012/06/24/opinion/sunday/political-scientists-are-lousy-forecasters.html?_r=1

The second problem is that they are experts. They are specialized and thuse interested in their expertise at the expense of others and the expense of their own awareness.

The third is that they are not like ship-building experts. They attempt to push their decisions on others who bare the responsibility. You can rarely sue an expert, especially one who gets his views passed as legislation, for your bad outcomes in following his/her advice.

Yancey Ward June 29, 2012 at 9:37 am

Tyler Cowen wrote:

I do think the Medicaid alterations in the Court’s decision will prove a big deal. I am well aware that the large federal subsidies mean it still makes financial sense for states to continue with the program and the various extensions embedded in ACA.

Does it make sense to continue? The states are going to have to pony up more money going forward for the extension of eligibility. PPACA explicitly does not cover the entire costs of the Medicaid expansion- the carrot of subsidy only last an limited time. This was necessary in order to keep the costs to the federal government low enough to get over the deficit reduction/neutral hurdle. Given the financial straits that states are in, and are likely to remain in, I don’t see a strong incentive to raise the taxes required to cover this. If there were really such strong incentives, why did so many states sue in the first place? The logical conclusion is that they intend to ignore the law in the regard, and the decision yesterday allows them to do so without fear of losing the rest of their Medicaid funding.

Roberts decision to uphold the mandate as a tax was a big surprise to me, but taken together with the 7-2 decision barring the law from penalizing the states suggests to me that a bargain was reached between Roberts and at least 2 of the liberal justices- they would vote to restrict the federal government’s power over the states with a strong majority, and Roberts would switch his vote to uphold the mandate.

Ellen C June 29, 2012 at 7:24 pm

Also, the subsidy for Medicaid is not as substantial as many think. Yes, it covers most of the medical costs of the expansion population, but it is the administrative costs that states are concerned about because only 50% will be covered with federal funds.

celestus June 29, 2012 at 9:41 am

From where I sit, the biggest problems of ACA were (1) requiring insurance companies to be stupid and charge everyone roughly the same amount for health insurance, with some allowance to charge more on the basis of age (aka “no discrimination against people with pre-existing conditions”); and (2) shifting more health care costs to the federal and state governments, quite a bit of it through the Medicaid expansion (health insurance as a Giffen good- it’s increasing in price, so the government should buy more of it!).

(1) was never going to go away for a long period of time even if the whole bill was thrown out. It’s just too popular and anyone who argues against it looks mean.

(2) we will see. States now can choose to spend more money on Medicaid etc. and have it matched by the feds, and many of them sued the feds because they didn’t want to be forced into it. Surely that implies that some of them will opt not to expand Medicaid? And where are California and Illinois (to give two examples) going to find the money on their end to go through with the expansions if they don’t have to do it? Note that this was a 7-2 ruling.

So I have mixed feelings about the decision.

Andrew' June 29, 2012 at 9:46 am

There sure is a lot of moderate mood affiliation going on.

Cochrane is wrong. They likely don’t have this (unlimited arbitrary taxing) power in equilibrium, obviously because to have that power is to gut any meaning the Constitution has, as evidenced HERE. Almost everyone now understands that the mortgage deduction is wrong. They vaguely understand the health insurance for employers deduction is wrong. This is the stark line representing the beginning of the end of the tax “code” used for behavioral manipulation. Also, it is assessed as a penalty, not a tax deduction. That means that it is not subtle social engineering, it is out-and-out coercion. There is a difference even if lawyers manage to not find it. Also, the justification of medical industry tribute mandate is different. It is not presented as your reducing your taxable income (e.g. childcare) nor is it presented as your performing a public service (e.g. charity). It is framed as you are free-riding unless you give money to the medical system. And consider this, now they can simply raise the tax.

I don’t think they will now illegalize homosexuality or other liberal hobby horses through taxation, although they absolutely have that power. This is why I always grudgingly land on the side of conservatives.

Finally, it’s the wrong thing to do. They could have worked to internalize externalities (as I have made countless more coherent proposals to do so). No, they externalized medical costs from the people who don’t benefit from the medical system as currently constituted to those who do. Most importantly, they could have shifted away from cash transfers to fundamental research. That’s before we consider that it made the economy and the federal budget worse, but holding politicians to their promises is naive and passe’.

“one of the Administration’s proudest accomplishments,” That, incidentally, speaks for itself.

Wilkinson: “my hunch (and none shall doubt my amazing intuition!) is that Mr Roberts may well have chosen to join his conservative colleagues had the court not lost so much public goodwill following the Citizens United decision…That is to say, Mr Roberts acted exactly like a senator with a lifetime appointment: he elected to advance his agenda in a manner available only to legislators immune from short-term electoral pressure…By now I think we all realise that “judicial activism” really means “a decision I don’t like”

This is what we have to hang our trust hat on? That this Supreme institution makes its decisions on bases such as this. That noone can actually tell the difference between a legitimate versus out of control branch of government? This is reassuring to you? How? No, this is just another step on the road of institutional delegitimization. Don’t worry, though, it’s not going to end in the way that libertarians hoped it could (when they gave decades of early warning). It’s going to be nasty.

anon June 29, 2012 at 12:25 pm

institutional delegitimization

I agree this will speed that up. And Andrew, I’m sorry to see you conclude with something other than your usual kind-of optimism (It’s going to be nasty.). But I fear you are right. (Are we going to end up like Europe – with out the old churches and castles?)

Andrew' June 29, 2012 at 1:15 pm

There’s no optimism because noone is interested in the boring process of:

“Hey, here’s a proposal.” “Nah, unconstitutional, try again.” “Okay, we’ll try again, this time we’ll do what we should have done the first time, fix the actual problem (or wait until we are out of a depression seems reasonable), incrementally, while staying WELL within the constitutional bounds.”

Hubris.

Freefall June 29, 2012 at 9:49 am

Can someone please help me determine when health care and health care insurance got put together? Insurance is a process of risk mitigation. The monetary risk can be pooled and transfered to an insurance company. When someone has a preexisting condition, there can be no risk transferrence, the event has already occured. They need medical care, not insurance.

This program never seems to solve one of the problems because health care is very different from health care insurance.

Orange14 June 29, 2012 at 11:32 am

During WW2 when, because of price controls, companies could not give employees a raise so they started insuring health. Of course this was in the days when health care didn’t cost nearly as much as it does now. At that time there were still large numbers of people who did not have insurance and of course the elderly who did not work couldn’t get it (this is why Medicare came to be).

Todd June 29, 2012 at 9:55 am

Tyler didn’t link to the Yglesias article about the decision, but you should check that out as well. If you have a problem with Roberts’ opinion, you should take a look at the dissents. They are far worse. Alito, Thomas, and Scalia don’t even think it is constitutional to partially de-regulate the dentistry industry.

Has Scalia jumped the shark?

Yancey Ward June 29, 2012 at 10:04 am

Whose regulations were the Feds changing in dentistry?”

Todd June 29, 2012 at 10:08 am
Yancey Ward June 29, 2012 at 10:21 am

I know the details- I was asking you whose regulations were the Feds changing?

Todd June 29, 2012 at 10:27 am

It’s no different than other medical professions. Monopolies are formed and regulated by State Dental Boards.

Yancey Ward June 29, 2012 at 1:18 pm

Exactly- state boards. Taken together with what they viewed as other impermissible problems, it isn’t such a leap to argue these should just be tossed, too. Congress didn’t even bother to plan for severability.

Todd June 29, 2012 at 2:06 pm

Plan for severability? A judge has a duty to sever and disentangle if he or she can, as would have been the case here.

What exactly is constitutionally impermissable about a mild partial de-regulation of dentistry? Upon what hook did the dissenters rely to propose overturning that provision? Or did they just say that they didn’t like it because they didn’t like the mandate?

Yancey Ward June 30, 2012 at 11:13 am

A judge has no requirement to sever the provisions of an act if the legislature doesn’t set that requirement into the law, and, in any case, it is a judgment call. There is also a principle in play that if you have to invalidate most of act (and this was the dissent’s position, by the way), then it makes no sense to retain minor provisions of said act, even if you think they are a good idea, or even valid. The portion in question can reasonably be seen as an infringement on state’s rights to regulate dentistry, even if that isn’t my personal preference.

Todd July 1, 2012 at 11:57 am

“The portion in question can reasonably be seen as an infringement on state’s rights to regulate dentistry”

Bank boards, School boards, Medical Boards, Boards of Election, Boards of Nursing, and a million other state-run monopoly and licensing boards….

Dentistry seemed just about the only type of State licensing and regulatory board (along with maybe Cosmetology?) that did not have some kind of federal regulatory involvement or extra requirements. Why stop at dentistry? What was the dissent’s rationale for drawing a line here? Was it based in actual judicial theory? Precedent? Anything that a judge ought to be writing about?

Or were they merely attempting to substitute their judgement for the legislature’s?

Chris June 29, 2012 at 10:34 am

The dissent wasn’t that the every provision was unconstitutional – the argument is that the core was unconstitutional and it wasn’t possible to dissentagle the bad parts and have a workable set of laws.

Todd June 29, 2012 at 10:40 am

Yeah, and that doesn’t make a lot of sense in this case. It just comes off as cranky and petulant. Why exactly wouldn’t it be easy to disentangle and sever the dentist de-regulatory provisions if you didn’t like the mandate? Something about congressional motive and the history of the bill itself? Not very solid judicial ground there.

collin June 29, 2012 at 10:02 am

I do believe the lack of a Republican alternative is a huge problem at winning the election especially since Romney has lacked details from the beginning of the primary. Despite having an array of unusual candidates, Romney spent the entire primary running out the clock with lots of negative ads in key states. I don’t believe that strategy is going to win the election as even Reagan in 1980 had to take some chances of winning that election. Although it was a completely wacky poll, Obama getting 65% of the support for Alien invasion does suggest the population tends to trust the incumbent.

If Republicans want to sell consumer based health market, then show consumers the benefits of more choices. They don’t have too specific but ideas of more over the counter drugs, more nurse care, shorter residencies for primary physicians, and increased competitive urgent care would go a long way to winning support. Unfortunately, the Republicans treat the AMA as a protected class so they don’t appear to care about health costs.

Orange14 June 29, 2012 at 11:34 am

OTC drugs are more expensive to the individual than they are under insurance since the consumer has to accept the full price. I’m not saying this is right or wrong from a policy perspective, only that there are lots of people who might object. The non-sedating antihistamines are a good example of this.

Cliff June 29, 2012 at 1:34 pm

This is usually wrong. Many drugs are incredibly cheap when you pay in cash, much less than insurance co-pays for the same drugs.

Rahul June 29, 2012 at 1:54 pm

Why won’t insurance pay you to buy them instead?

Scoop June 29, 2012 at 10:25 am

1. My gut says “incorrect” but only time will tell. Liberal trust of Roberts (and perhaps court decisions in general) may rise if they perceive that he voted against his wishes because he thought this the “correct” decision. But most of what I’ve read from liberals interpreted his action differently, as a sign that he didn’t even have the courage to do what he thought was right and that he can be pressured politically. That reduces trust in the court, even from liberals. Plus, of course, this decision reduced trust in the court for the reasonable majority of Americans who believed the law to be unconstitutional.

2. Defer to experts makes sense in highly technical fields: space travel, nuclear power plant design, physics. It makes no sense whatever in Constitutional Law. A whole industry exists to claim that only really high IQ people who have “studied” the constitution for decades can really understand these matters. That industry procures much prestige and high salaries for its members, but it’s based on an utter lie. The constitution is not a difficult document. John Roberts has no greater ability to read it and determine whether laws break it than any reasonably bright person. The people who wrote Dred Scott and any other number of terrible opinions were great experts on the constitution but they clearly got it wrong.

3. Would make sense if the court had maximized prestige. Given that a pretty decent plurality of people (and by some polls a majority of legal scholars) thought this unconstitutional, I don’t see how any prestige maximization occurred. As with point 1, though, I fully acknowledge that time may prove me wrong here.

4. The government obviously does many unconstitutional things that will never now be ruled unconstitutional: Social Security, Medicare, Medicaid, most of the Civil Rights Act. That doesn’t mean defenders of freedom shouldn’t work hard, in cases where precedent hasn’t destroyed constitutional limitations, from using the text of the constitution to their advantage.

5. Agreed that the Republican party has no coherent plan to fix our major healthcare problems. That said, your wording of this seems to indicate that the current plan is a coherent attempt to address the problem. That’s just absurd. The actual problem is that health costs are rising too quickly and that Americans are consuming too needless healthcare. The problem that Obamacare addresses is a fictional one: uninsured Americans are not getting adequate healthcare. It does a bit to address costs, but no impartial review expects it to even cut the speed of growth of costs. Repeal this and do nothing else is not anything like a fix but it’s still wildly better than stick with this.

6,7,8 Agreed.

Cob June 30, 2012 at 4:49 pm

The repeated assertion that a plurality of people (experts or otherwise) thought the law unconstitutional is untrue. Most constitutional scholars thought it constitutional, though they predicted the court would rule otherwise. Surveys indicate majority opposition to the law, but not majority belief it was unconstitutional.

Bill June 29, 2012 at 10:30 am

Having predicted that Roberts would write for the majority upholding the ACA (although wrong predicting his commerce clause position), I think conservatives have missed a few points that Roberts gave them with his approach:

1. Calling the mandate a tax places the bill in the House Ways and Means Committee; and since all taxes must originate in the House, positions the House as a major actor if there is change using a mandate;

2. By causing personal mandates to be monitized in the future, it has forced cost transparancy; just as the federal government mandates to the states, thereby keeping a cost off its books, the federal government will have less of a chance mandating to individuals other than through penalties or taxes; that may be good–good for transaparency but maybe bad for efficiency and policy, as some may oppose an approach because it is framed as a tax (where they otherwise might have favored it) and maybe bad because a non-tax approach would be the most transactionally efficient.

3 Red states with high medicaid thresholds get what they want–they don’t have to participate in the new program. Blue states get what they want: They get Red State federal taxpayers to contribute to their Blue State medicaid programs.

What could be fairer.

JWatts June 29, 2012 at 12:21 pm

“3 Red states with high medicaid thresholds get what they want–they don’t have to participate in the new program. Blue states get what they want: They get Red State federal taxpayers to contribute to their Blue State medicaid programs.

What could be fairer.”

There is nothing fair about forcing poorer states to subsidize the medical needs of richer states.

Bill June 29, 2012 at 1:17 pm

Texas is not poor. Florida is not poor. Arizona is not poor.

They just choose to spend their money a different way or not tax their elites.

Bill June 29, 2012 at 1:26 pm

JWatts, You also misstated the effects: Red states are not paying; it is federal taxpayers in Red States, as you will note that is how I said it.

I

JWatts June 29, 2012 at 2:22 pm

“Texas is not poor. Florida is not poor. Arizona is not poor.”

And what about Mississippi, West VA, Arkansas, Kentucky, Alabama, Oklahoma, etc…

“They just choose to spend their money a different way or not tax their elites.”

So, since they don’t choose to spend more of their money on subsidizing a poorly written law, then screw them, huh?

MD June 29, 2012 at 3:55 pm

Don’t worry about Mississippi, et al. I’m sure they will continue to leach off rich states as they do now.

Mark June 29, 2012 at 10:31 am

I don’t understand the “trust is higher” comment at all. If this is about maintaining the credibility of the Court it is very different from the situation during FDR’s time. Then the Court faced legislation passed by large majorities with substantial Republican, including sometimes majority support from that party, and which was very popular with the public. In this case, you had legislation pushed through by a close vote and exclusively by one party through a parliamentary sleight of hand and which is unpopular with the public, leading to massive losses by the Democrats in the 2010 election.

If the “trust” you are referring to is the trust of The New York Times and Harvard and Yale Law School professors that’s simply pathetic.

Bruce Cleaver June 29, 2012 at 11:28 am

That is what he meant, and it is pathetic.

NeedleFactory June 29, 2012 at 10:42 am

My new puzzlement concerns what limits now exist, if any, on Congress’s taxing authority. I had this naive idea that I could be taxed only for things I did (get a paycheck, use a phone, buy a book) or things I have (car, house).

It now appears you can be taxed for things you don’t do. Can Congress now tax people for not voting, not taking vacations, not buying carbon monoxide detectors?

Bill June 29, 2012 at 11:23 am

Puzzled, People get fined or penalized all the time for not doing things: don’t put sprinklers in the hotel and see what happens. Don’t stay on the walkway, etc. Don’t speed. You can always frame something by calling it the opposite and penalizing that.

You can even think of tax credits as fines: you pay full taxes unless you do x, whereupon you get a credit if you do x. You are fined by paying higher taxes for not doing x.

It’s called duality. It’s how you frame it.

Cliff June 29, 2012 at 1:39 pm

Legally, a tax and a penalty are two different things. A tax has to be for the purpose of raising revenue

Hoosier June 29, 2012 at 2:51 pm

So, in his decision, did Roberts either willfully ignore this legal definition, or was he just ignorant of it? I find it hard to believe either is correct.

Cliff June 29, 2012 at 11:40 pm

Read the opinion. My understanding is generally accepted as far as I can tell. Every lower court found the “assessment” as Bill puts it to be a penalty and not a tax.

Bill June 29, 2012 at 3:34 pm

Cliff, Let’s just call it an “assessment” and leave it at that.

Unless you want to say that Romeny orchestrated the largest tax increase in Massachusett’s history with his healthcare mandate.

Don’t be led around by the nose by the choice of words–Congress has the right to do both.

They could even have raised everyone’s taxes by $10k, and given at $10k tax credit if you bought insurance.

Eric June 29, 2012 at 5:00 pm

They “could have” raised everyone’s taxes by $10k and given a $10k tax credit if you bought insurance. But they didn’t. They explicitly created a penalty for noncompliance which might be the same economically but isn’t the same psychologically (or legally from what I can tell).

Jacob June 30, 2012 at 5:05 pm

Does it really matter?

Malcom Digest June 29, 2012 at 7:04 pm

“Unless you want to say that Romeny orchestrated the largest tax increase in Massachusett’s history with his healthcare mandate.”

No, states have the authority to level mandates, the Federal government does not. The context of the law matters.

Bill June 29, 2012 at 7:38 pm

+1 for clarity.

Just kidding

Bill June 29, 2012 at 7:43 pm

Malcolm, Let me ask a question. What part of a state constitution do you think provides for mandates? Is it that states can regulate their own commerce, and that a mandate is regulation of commerce? If that is the case, then you’ve made the argument that commerce clause (which covers interstate commerce) includes a mandate as well, since it is commerce in the same sense as it is commerce under a state constitution. It can’t be commerce for one jurisdiction, and not for the other.

So, please explain.

Malcom Digest June 29, 2012 at 8:03 pm

The states have a general police power while the feds do not. A better discussion than I’ll be able to provide can be found here:

http://www.huffingtonpost.com/scott-kahan-md/rick-perry-health_b_932924.html

Also note that the MA law has been on the books for years without the kind of outcry you’d expect if such a law were unlawful.

Bill June 29, 2012 at 8:50 pm

Malcolm, the term police power is the same as the term regulation. You sometimes here the term in federal legislation as well.

Cliff June 29, 2012 at 11:38 pm

Bill, I thought you were a lawyer? States have plenary power and are not limited to the powers granted to the federal government in the Constitution (obviously).

Malcom Digest June 30, 2012 at 3:45 am

Here’s another write up on the principle I’m talking about, including quotes from the court’s decision:

http://reason.com/blog/2012/06/28/scotus-on-police-power-or-how-romney-can

Bill June 30, 2012 at 9:47 am

Cliff, I am a lawyer, and what I said about police power being regulation is true. Sorry. I’ll see if I can find something for you that is not on some right wing website.

Here is part of one from onecle:

“Federal Police Power.—A year before Collector v. Day was decided, the Court held invalid, except as applied in the District of Columbia and other areas over which Congress has exclusive authority, a federal statute penalizing the sale of dangerous illuminating oils.16 The Court did not refer to the Tenth Amendment. Instead, it asserted that the “express grant of power to regulate commerce among the States has always been understood as limited by its terms; and as a virtual denial of any power to interfere with the internal trade and business of the separate States; except, indeed, as a necessary and proper means for carrying into execution some other power expressly granted or vested.”17 Similarly, in the Employers’ Liability Cases,18 an act of Congress making every carrier engaged in interstate commerce liable to “any” employee, including those whose activities related solely to intrastate activities, for injuries caused by negligence, was held unconstitutional by a closely divided Court, without explicit reliance on the Tenth Amendment. Not until it was confronted with the Child Labor Law, which prohibited the transportation in interstate commerce of goods produced in establishments in which child labor was employed, did the Court hold that the state police power was an obstacle to adoption of a measure which operated directly and immediately upon interstate commerce. In Hammer v. Dagenhart,19 five members of the Court found in the Tenth Amendment a mandate to nullify this law as an unwarranted invasion of the reserved powers of the States. This decision was expressly overruled in United States v. Darby.20″

Bill June 30, 2012 at 9:53 am

Cliff, Here is some more that summarizes the police power issue and the scope of the commerce clause from the same source:

In 1941, the Court came full circle in its exposition of this Amendment. Having returned four years earlier to the position of John Marshall when it sustained the Social Security Act27 and National Labor Relations Act,28 it explicitly restated Marshall’s thesis in upholding the Fair Labor Standards Act in United States v. Darby.29 Speaking for a unanimous Court, Chief Justice Stone wrote: “The power of Congress over interstate commerce ‘is complete in itself, may be exercised to its utmost extent, and acknowledges no limitations other than are prescribed in the Constitution.’ . . . That power can neither be enlarged nor diminished by the exercise or non-exercise of state power. . . . It is no objection to the assertion of the power to regulate interstate commerce that its exercise is attended by the same incidents which attended the exercise of the police power of the states. . . . Our conclusion is unaffected by the Tenth Amendment which . . . states but a truism that all is retained which has not been surrendered.”30

Scoop June 29, 2012 at 10:45 am

The pieces you linked to claiming that Roberts is a tactical genius for sacrificing this loss to preserve the legitimacy of the court AND narrow the commerce clause for all future uses are just plain stupid.

1. He might have narrowed the commerce clause had he gotten the four liberal justices to agree with the logic that the CC did not work and only gov tax power justified the individual mandate — extracted it from the four libs as his price for saving the law. But he didn’t. Five conservative judges said the CC did not justify this. Four liberal judges said it did. Exactly the same as if Roberts had the nuts to follow the constitution and nullify the thing. This will not make limited the CC easier in future or make liberals concede more legitimacy to decisions that do.

2. Far from increasing the legitimacy of the court, Roberts has essentially given liberals reason to expect that they can stop the court from doing anything they dislike by making it clear beforehand via the MSM that they will consider an opinion they dislike to be nakedly political and thus illegitimate. The way to make people see the court is not political is simply to do what the constitution says, and that means throwing out the CC. If Roberts wants to show that he will make decisions that he does not personally favor — that he will sacrifice his own beliefs to uphold the constitution and the democratic principal — then the way to do that is take some cases that challenge some government action that sickens conservatives but clearly are constitutional and the uphold them. Upholding an unconstitutional law does not increase anyone’s respect for the supreme court.

TallDave June 29, 2012 at 11:02 am

1. Precedent matters.

2. The really slick part is that this fires up Romney’s supporters. If he wins and the GOP takes the Senate, Roberts gets to look impartial and PPACA is repealed anyway.

JWatts June 29, 2012 at 12:34 pm

“1. Precedent matters.”

Yes it does and in the long run Roberts decision may well turn into a short term cost for a long term Commerce Clause narrowing precedent. Certainly, liberals will argue that the Commerce Clause is expansive in the future, but this decision will be constrain that argument.

“2. The really slick part is that this fires up Romney’s supporters. If he wins and the GOP takes the Senate, Roberts gets to look impartial and PPACA is repealed anyway.”

If it does indeed fire up Romney’s supporters and Romney wins (regardless of the Senate) then its probable that PPACA will be at the very least modified. If not modified then it’s virtually certain that the House will defund its provisions.
However, if Romney doesn’t win then this decision will be considered by some as one reason why he did not win.

MD June 29, 2012 at 3:05 pm

Precedent does matter. However, if the legislature hadn’t passed a law with something like the mandate/tax in 220 years, then this issue is unlikely to come up a lot. Basically, the Court just said, all those other things we have already approved under the CC are cool, you just can’t do this new thing. It certainly doesn’t get A’, TD and the others here any closer to the day that the Court will go back to its pre-36 view of the CC. They’ll have to do things the old fashioned way: by voting for pols who think like they do, and hoping for the best.

TallDave June 30, 2012 at 11:41 am

It seems likely new CC tests will come up.

MD June 30, 2012 at 3:44 pm

Maybe there are 5 votes to overturn Wickard v. Filburn. I suppose we will see.

Scoop June 30, 2012 at 12:02 pm

1. Yes, precedent matters. But the point is that precedent here for limiting the CC clause is no stronger than if Roberts had voted to nullify the law. (If all you’re saying is that “If he was going to vote to uphold, it’s better for precedent that he did so on tax grounds than on CC grounds,” then I’d agree with that.

2. So you are actually betting a) this law gets overturned and b) that liberal activists and journalists will give Roberts grudging respect for honesty and integrity in future when he overturns laws they like because he voted this way on health care? You don’t believe they now think that he caves to pressure and can be made to vote their way on future issues if they make enough noise beforehand that the liberal half of the country will view any decision they dislike as nakedly politically and fundamentally illegitimate? Only time will tell but I think all conservatives who are spinning it this way are not only kidding themselves, but kidding themselves in a laughable stupid way.

TallDave June 30, 2012 at 3:01 pm

1. Yes, I agree.

2. How much reading of the left have you been doing this week? While I agree their reactions will be similar in the future, there now exists a whole lotta praise for Roberts that is going to be thrown back in their faces when they do — all their talk last week of a “coup d’etat” already looks pretty hysterical now. The internet never forgets!

steve June 29, 2012 at 10:50 am

I am pretty sure I have read all of the GOP alternative proposals, though I could have missed some. I would have thought the PCA the most likely replace plan given its sponsors. However, even if it is the best of the bunch, it is still very short on detail. To the best of my knowledge, it has never been scored by the CBO. I think the real problem is just that this is not a topic that interests much of the GOP. They offer plans to counter Democrats, but when they are running things, they dont usually offer reform bills and have been unwilling to spend real political capital on the issue.

Steve

JWatts June 29, 2012 at 12:37 pm

“but when they are running things, they dont usually offer reform bills and have been unwilling to spend real political capital on the issue.”

That’s really not true in even the slightest regard. Even narrowly considering Healthcare bills, one needs to look no further than Medicare Part D as a counter example.

Urso June 29, 2012 at 11:21 am

One interesting question is why do the members of the SC care so much about the Court’s legitimacy while members of Congress are completely unconcerned with that body’s legitimacy?

Is it because Congress is legitimized one at a time, member by member, via elections, every two years? So every individual Congressman can feel secure that he, personally, has a valid democratic mandate to do whatever, and thus can feel free to insult & denigrate his fellow reps. Whereas the SC is seen much more as acting as a body, and a poor public perception of any member affects the legitimacy of the entire court.

Bill June 29, 2012 at 11:54 am

No, it’s because the Supreme Court is expected to follow precedent, Citizens United notwithstanding, whereas the legislature can depart from precedent, which is called legislating.

Slocum June 29, 2012 at 12:00 pm

“Trust is higher now, and that is worth something, even if like me you never favored the mandate segment of ACA.”

I’m afraid the effect may be the opposite. The ‘greater trust’ idea is that because liberals had a general freakout over Citizens United, they would have gone completely around the bend had the ACA been struck down, and so Roberts made the non-inflammatory choice. But the perverse incentive problem is pretty obvious. If ‘working the refs’ through histrionics is effective (or is even perceived as effective), its use will be expanded, not reduced.

Yancey Ward June 29, 2012 at 1:32 pm

I don’t think Robert’s decision was influenced much by the histrionics. However, since the hissyfitters probably believe it, you will see more of it going forward. My personal feeling was this- Roberts knows that the electorate has a chance to undo this law itself, if they care enough about it, and I think he used the leverage he had to build a bulwark for the states vis a vis the federal government. In the end, this will matter more than what might well be a short-term and pyrrhic victory for the mandate. I think there is even a good chance the mandate will be undone/replaced after November no matter who wins.

Contemplationist July 1, 2012 at 6:11 pm

The biggest troll in all this is Scalia. Had he not upheld Gonzalez v Raich it would’ve never come to this. That was a clear cut chance to reverse Wickard v Filburn, instead he doubled-down.

Roxy June 29, 2012 at 12:22 pm

I find it interesting that Tyler and all the conservative/libertarian writers he links to above are untroubled (and seemingly relieved) by the court’s decision here.

My hunch is that, had ACA been struck down, they would have been very uncomfortable. Not just b/c we progressives would be mobilizing for thermonuclear war. But because many conservatives and libertarians *themselves* would feel that their desired political ends had been achieved by illegitimate means. It would have felt unclean, like cheating. Hence the relief.

Cliff June 29, 2012 at 1:41 pm

Troll?

Roxy June 29, 2012 at 2:44 pm

Maybe. Has no bearing on the substance.

Andrew' June 30, 2012 at 4:07 am

No, those are just the usual suspects (I don’t know about Cochrane) who engage in the moderate mood-affiliation and a kind of funny version of political efficient markets.

Here is Jonah Goldberg regrettably agreeing with my views…
http://www.newsday.com/opinion/oped/goldberg-john-roberts-judicial-twistifications-on-health-care-1.3812189

I’d rather agree with the likes of TC and WW and MM, but they sometimes engage in mental twistifications (see anything they write about Ron Paul) in ways I can never understand.

Andrew' June 30, 2012 at 4:09 am

(to me, the best example of this was TC’s defense of the TSA pat-downs and X-rays, which included not a single actual defense of the techniques themselves)

Andrew' June 30, 2012 at 4:09 am

(not criticism, just observation, btw)

Go Kings, Go June 29, 2012 at 1:09 pm

You may have noticed that I haven’t blogged the legal challenge to ACA all year.

I can see why that made a lot of sense.

Halt June 29, 2012 at 1:39 pm

1 and 3 endorse reputation mgmt over the court’s entrusted mission. Yes I get “multiperiod”.

Only an ecomist in the trees could endorse this evil line of reasoning.

Shame on you coward.

And republicans venture little new as the left media machine immediately demonizes them to death.

Andrew' June 30, 2012 at 4:28 am

I have only seen TallDave provide actual information to counter what is basically the lie that other countries have better healthcare systems because they spend less and have roughly the same lifespans.

http://www.classicalvalues.com/archives/2009/10/health_care_man.html

Add to this my constant observation that other countries costs are rising as fast as ours from a lower base and the observation that roughly 85% of medical costs go to 25% of the population and both points of the only evidence for socialized medicine falls apart. Not to mention, in absolute numbers we have the most socialized medicine in the world.

That is, lifespans can’t be the correct variable when only 25% of the population utilize almost all the healthcare spending (not to mention this makes a mandate a simple cash transfer, not really insurance). And if the costs of other countries really are rising at similar percentage rates, then they aren’t controlling costs. Our problem is we aren’t translating dollars into lifespan, which is unsurprising since lifespan is not a measure of medical care, certainly for different-country comparisons. For example, South Korea has increased spending incredibly while increasing lifespans impressively. I bet you didn’t hear anyone suggest we look at what South Korea is doing. Our problem is that 85% of the costs go to 25% of the population, probably lumped largely as cash transfers from the general population to the end-of-life population. It is hilarious to call 75% of the population who use 15% of the medical spending the 100% healthy free-riders. Hilarious and cynical.

It is funny how David Brooks defends the SupCo ruling on the basis that Obamacare didn’t address any of the fundamental problems with conventional medical service provision. In other words, it’s constitutional to tax ANY behavior, and though the ACA didn’t accomplish any of its stated goals (I still don’t understand how a mandate penalty passes for compassion for the uninsured) it starts the discussion. No, it effectively ends the discussion because now it is a crime…I mean…a taxable event to not be part of the status quo system.

Andrew' June 30, 2012 at 4:34 am

I’m always looking for concise ways to state things. I usually fail.

Our current system is not a healthcare system (one of the reasons I try not to call it healthcare). It is largely adeathcare system. We spend nearly all our dollars on the deathly sick. And then “we” are surprised when it

To me, and I don’t see how you can view it otherwise, results directly from our government dollars being mostly required to be spent on the elderly. You don’t get medicare for eating spinach in your 20s. You get medicare once you reach the downhill slope. That is biologically the wrong time to try to affect health.

Ricardo June 30, 2012 at 6:08 am

Andrew, how are statements like “U.S. does 2x as many transplants as OECD average”, “U.S. has about twice as many MRIs as OECD average”, or “U.S. performs more operations than any country in the world” evidence that the U.S. has a superior health system? They are proof that the U.S. does more procedures and tests but, as anyone who follows the health care policy debate or the literature on health economics knows, more spending or more procedures do not always lead to better outcomes.

This basically leaves the assertions about cancer survivor rates. As Dale pointed about above, though, studies typically only measure survival after diagnosis and the U.S.’s aggressive testing probably leads to earlier diagnosis. Whether it actually extends anyone’s lifespan is not demonstrated by these studies.

Yancey Ward June 30, 2012 at 11:32 am

Ricardo,

I will ask you the variations of questions I have asked many others, and never received an answer to:

What do you think would happen to the lifespans of Americans if we didn’t have twice as many transplants or MRIs?

I ask this because, if a country like France can spend half as much and live longer, why can’t France spend even less than that?

Ricardo July 1, 2012 at 12:06 am

Yancey, one thing that seems apparent from even just browsing the literature on comparative effectiveness is that there often is very little scientific evidence (especially RCTs) supporting the American system of aggressive, risk-averse testing and treatment. So I think one answer to your question is nobody really knows if aggregate outcomes would change much at all and, indeed, there is evidence supporting that hypothesis in the form of life expectancy statistics in other countries.

TallDave June 30, 2012 at 11:46 am

Ricardo — get back to us on that when you need a transplant, MRI, or operation.

Yancey — the answer appears to be “almost nothing.” A lot of these things aren’t even aimed at extending life but rather restoring function, and even the rest have a very small effect on aggregate LE — healthcare has diminishing returns, esp. at our levels of consumption. But most people would rather not have themselves or loved ones suffer or die. so as a rule when we can do something, we do, and usually at highest available quality. Other countries don’t, which is more efficient.

Anon Y. Mouse June 29, 2012 at 1:56 pm

The RINOpublican party’s plan for Health care was Medicare Part D.

So if we are going to count on them to repeal Obamacare, look at their record of Medicare Part D.

So it is obvious the RINOpublican party will never repeal Obamacare.

LG June 29, 2012 at 4:19 pm

“Making the mandate a tax has at least one other effect. It makes repeal easier. Now that the mandate has been deemed taxation, it can likely be jettisoned through use of the reconciliation process — meaning the Senate will need to muster only a bare majority for repeal, not 60 votes.”

My sense is this is true, but probably doesn’t help the repeal because the related ban on using pre-existing conditions to deny coverage are not just a tax and would still need 60 votes.

Yancey Ward June 30, 2012 at 11:44 am

It won’t matter. They could just unfund the bill altogether, and that can be done in the budget process. They will turn it into a shell without any meat.

However, I expect such provisions to actually be retained anyway- they were the popular parts of the bill. No one in either party gives a flying &*%$ about the insurance companies. I expect them to exit the business within a decade regardless.

Orange14 June 29, 2012 at 5:18 pm

Uwe Reinhardt has just the solution for the Libertarian crowd who follow this thread: http://economix.blogs.nytimes.com/2012/06/29/health-care-solidarity-vs-rugged-individualism/#more-152974 Maybe Tyler can link it to one of his update posts since this thread is rather long and people are burned out. What say you Libertarians, does this solve your issues???

Bill June 29, 2012 at 6:02 pm

Since Reinhart created an exception for medicaid (ie, if you opt out, medicaid would still be available) what you would have over time is a program where sick libertarians would be arguing for an expansion of medicaid.

mulp June 29, 2012 at 6:00 pm

On 7, the conservative’s distortion of the process to pass the law in both the House and Senate suggest the law was not passed with overwhelming “consensus” of the Congress in modern Congressional terms.

The health reform law passed with greater support that Bush’s failed failed failed tax cuts which promised higher rates of job creation than experienced during the 90s, without increasing the debt.

A bill passed by reconciliation must be purely direct budget measures affecting revenues and spending. Regulatory provisions are not budget measures even if their ultimate objective is deficit reduction. Thus, the provisions for including 26 year old children on the family policy is not budgetary. Neither is the payment advisory “death panel” board authority – its objective is reducing spending indirectly, but it isn’t budgetary. The “donut hole” provision is a deal to phase it out budget neutral by the way the private insurers construct Part D plans. A repeal bill need to be selective if passed by reconciliation, and even then, a big repeal will face does of points of order for items that aren’t clearly spending, and taxes can’t easily be removed, and reduce the deficit.

Without careful planning, a quick repeal that passed by reconciliation would create such a hash that Republicans claiming they repealed Obamacare would be faced with huge outcry over the remaining law that creates burdens without benefits or funding. Let’s see, insurers must offer policies without preX and only 3 age bands, but their is no subsidy or mandate, so in 2014 the insurance market is in turmoil, and no one can afford the policies offered because they jumped 20%.

mulp June 29, 2012 at 7:26 pm

On 8, the Medicaid ruling. The Court has ruled the Congress can not use funding cuts to force States to change their laws, so no State can be forced to cover the millions of people without access to health care unless they fear dying by cutting off Medicaid funding.

But that also means that States which expand Medicaid to cover single adults and working families below 133% of poverty who are not covered today, can not be coerced by Congress to revoke that coverage by legislation under threat of Congress cutting the 100% and 90% Federal subsidies.

As many expanded Medicaid subsidies are already in effect and States have already passed laws to use them, that spending under Obamacare can’t be cut, if the Supreme Court ruling has any meaning.

Repealing the Medicaid provisions in Obamacare is thus coercive and in violation of States right! ;-)

Yancey Ward June 30, 2012 at 11:48 am

Unfortunately for those states who take the subsidies, they are terminated in 5 years. All the Republicans have to do is not extend them.

Yancey Ward June 30, 2012 at 11:54 am

I expect almost all the states to revert to pre-Obamacare Medicaid, if only to save their fiscal asses. You really should look at the map of the states that sued over this issue. You will be in for a shock.

This is why I think Roberts decided the way he did- to him, the most important issue at hand was state sovereignty, and parties at the state level don’t align all that well with their federal bedmates. I think he pulled on over on the liberals on the court by getting two of them to vote for that rewrite. And I write this as someone who thinks the argument against the Medicaid penalties was actually wrongly decided.

Roderick T. Long June 29, 2012 at 10:08 pm

“Hardly anyone employs that line of reasoning, but that is a sign of our irrationality.”

I don’t think so — even granting arguendo Roberts’ lofty wisdom etc. a) For many of my beliefs p, I can think of someone smarter than I am who denies p. b) Yet in nearly all those cases, I can think of someone smarter than I am who affirms p. c) So even if (a) by itself should lead me to rethink my position [and I'm not convinced it should, at least with philosophical views; you can't accept a philosophical view on authority], why isn’t (a) neutralised by (b)?

> The Court is not there to do what you want it to, or even necessarily to do what is right. Get used to that.

Oh, I am used to it.

Andrew' June 30, 2012 at 3:55 am

Also kind of funny, this meme that “The Court” acted apolitically because one justice’s opinion was in line with neither party.

Andrew' June 30, 2012 at 5:10 am

And what about this thing that Roberts largely disagreed with the side he voted with? Isn’t that not really supposed to happen, especially with something that might be the most significant legislation he’ll ever face? And why does he interpret it that it is unconstitutional through the commerce clause but constitutional as a tax? Why does he interpret it as you get to choose the easiest path rather than that maybe your calling it a tax might be wrong if it doesn’t pass muster elsewhere. I don’t even refer to the constant stretching of things like “general welfare” to mean cash checks cut to individuals. I refer to the idea that if something is explicitly forbidden in one place, just because you can squeeze through the eye of a needle (that was originally the size of a benzene ring) elsewhere it is still forbidden, by logic. I simply refer to the idea that maybe if the central government can’t fine an individual something, maybe they can’t fine them for it either…even if they call the fine a tax penalty. Isn’t that just as, if not more eminently reasonable a position- especially if you say it is not a tax in order to hear the case?

I understand the leeway theory of deference to Congress (actually I don’t, I wouldn’t be afraid to just stamp it with “try again,” but I’m aware of it). But I’m not talking about leeway, I’m talking about maybe Roberts’ opinion is simply wrong. I’m guessing this decision will not be treated as reverentially by history as it is being today. I think it is less elegant and nuanced and more strategic and shoddy. People are talking about how he acted modestly, but I don’t see it. Did he not just change the meaning of the Constitution more than anything in recent memory? He has made the case that anything can be legislated against as long as the penalty is by taxation, followed by IRS enforcement. If we taxed anal sex (which can certainly be justified due to health expenses), what now could the ACLU do? I guess progressives aren’t too sad because as long as everything is a tax the typical Democrat supporter doesn’t have enough money to penalize through taxation. Civil liberties are cheap. I’m guessing that either Roberts is shocked at the response, or is reveling in his calculated position of power as the new swing vote.

Andrew' June 30, 2012 at 5:56 am

On the bright side, this is the perfect time to re-introduce my immigration tax idea…

Steve Roth July 1, 2012 at 1:58 am

“I’ve also long considered health care policy a matter to be settled by the legislature not the courts.”

That seems to have been Obama’s view as well — he’s a real (if arguably naive) constitutional conservative. And that seems to be what pisses progressives off so much. They (we) want the FDR moment.

chuck martel July 1, 2012 at 12:57 pm

The SC decision aside, the crux of the matter is that a significant portion of the population doesn’t want “poor” people to be forced to pay for their health care and really doesn’t want to pay for their own, either. So rather than devise some kind of convoluted relationship between the entrepreneurs in medicine and pharmaceuticals and the government/taxpayers, why not just nationalize health care. Forget about health insurance entirely. Make doctors, nurses, admins, drug manufacturers, hospitals, etc. employees of HHS. The NHS is already massively subsidizing research, the framework currently exists in the PHS and VA. Just quit dancing around, make all health care workers wage-grade fed employees. Then make all health care free for everybody. It’ll work out perfect.

CCbiggs July 4, 2012 at 8:18 pm

Why do you assume that this decision helps or defends the Court’s prestige? The prevailing view is that Chief Justice Roberts switched his vote because he thought it better to uphold the law rather than strike it down, for reasons other than the substantive constituional merits of the law. Whether that’s true or not is unknown, but it is the prevailing view. I’d think this only hurts the prestige of the Court. How does it help?

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