The Supreme Court’s health care decision: What it does—and does not—mean

Anthony Komaroff, MD

Editor in Chief, Harvard Health Letter

The passage of the Patient Protection and Affordable Care Act (which I’ll just call the Law) in 2010 was regarded as a landmark event in U.S. history. Today’s ruling by the Supreme Court, which largely upholds the Law, should also be viewed as a landmark event—whether one agrees with it or not.

Why? Three reasons: Everyone wants health care when they need it. Everyone wants to be spared financial devastation from the cost of that care. And health care accounts for 17% of the total U.S. economy, and is growing at a faster rate than the rest of the economy—putting the rest of the economy under enormous strain.

Before the Law was passed, I saw two huge challenges facing U.S. health care. The first was the fact that so many people did not have health insurance. The second was the high cost of health care.

For decades, the percentage of Americans with health insurance has been lower than in other developed nations. Passage of the Law did not immediately change things. At the time of a survey by the National Center for Health Statistics in 2011, 46 million Americans—15% of the population—had no health insurance. These people lived an automobile accident, a heart attack, or a stroke away from becoming destitute.

Who are they? Relatively few are unemployed adults. People who are chronically unemployed have often been able to get health insurance through Medicaid. In fact, most of the uninsured are working adults whose employers did not provide health insurance. Many are children—often, the children of employed but uninsured adults. A smaller fraction are adults under the age of 65 who are out of the labor force.

Another group of people without health insurance are healthy young adults who have simply decided not to pay for health insurance—and to take their chances. They know that if they become seriously injured or ill, they will receive health care somewhere—effectively paid for by the insurance payments that other people are making. They are “free riders.” In passing the Law, the President and Congress basically said to them, “That’s not fair.”

What does the Supreme Court’s decision mean?

It means many more people will have health insurance. That does not, however, mean universal health insurance will be provided to everyone.

It means that health care will continue to be provided largely by the private sector—private doctors and hospitals. And for people under age 65, it will largely be financed by private insurance companies, not the government. The charge by some that the Law is “socialized medicine” is simply misinformed.

It means that many very popular provisions of the law will remain in force:

  • Insurance companies won’t be able to deny an individual coverage because he or she has a chronic medical condition, drop coverage if an individual becomes sick, or put limits on the amount of lifetime coverage a person can get.
  • Young adults under age 26 can still be covered on their parents’ health plans.
  • More low-income people will probably be covered by Medicaid, a health insurance program financed by both the federal government and the states

It means that several unpopular provisions of the law also will remain in force:

  • Starting in 2014, individuals will have to pay for health insurance: no more free riders. The Law creates mechanisms that make the cost of health insurance much more affordable for people who don’t have coverage through employers, Medicaid or Medicare. But nearly everyone will have to pay. That’s the contentious “individual mandate” that many people had speculated would be ruled unconstitutional. It wasn’t.
  • Starting in 2014, many employers who do not currently offer health insurance as a benefit will be required to do so, or pay a stiff penalty.

In summary, the decision of the Supreme Court means that more people will have health insurance. It also means that the enormous uncertainty—for individuals, for employers and for government—about whether the Law would remain the law of the land has been removed. Planning can move forward.

But several major issues remain under a cloud of uncertainty.

Will there be a new President and an altered Congress in January 2013 that might repeal the Law?

Will the constraints on using Medicaid funding that the Supreme Court placed on the Law make it difficult to find the money necessary to provide coverage to everyone the Law intends to cover?

What will be done, if anything, to provide insurance to the millions who will remain uninsured even after the full implementation of this law?

Finally, what will the Law do to contain the rising costs of health care? If those costs continue to rise well above the rate of growth in the economy, it will be damaging to the economy—even if it protects more people from personal financial ruin.

I’m a practicing doctor. I’ve cared for many patients over the years who had no health insurance, and who lived in constant fear for their personal and financial health. So I was delighted that the Law was passed, and am very happy that it has been upheld by the Supreme Court. I’m not cracking open the champagne just yet, though. Although the Law is a major step forward, some major obstacles still remain.


  1. Ellen

    It is pretty bad when you put off going to the doctor because you know that it could put you in bankruptcy but you give in because you are very sick,then get stuck with the bill and then you can’t get your medicine from the pharmacy because it cost two weeks pay and it’s feed your family or get your prescriptions! Family and food comes first. So we get sicker. Great medical care this country has isn’t.People with money are the only ones that matter. Someone from the government should spend some time sitting in a pharmacy for a hour or so. People are told all day long they can not get the medicine they need and walking out enraged. Not to good for a world power.

  2. Therese Nelson

    Thank you for a well-written and helpful explanation of the health care law. I am personally very happy that an estimated 30 million more people in America will soon be able to have health insurance. It’s also important to stop free-riding, which costs us all. Having had health insurance throughout my life, I know how important it truly is. When my husband got cancer, I don’t know what we would have done without it. Of course, we could have tried going to the emergency room, but he needed sustained care over a period of months, and emergency rooms aren’t equipped to provide that. We would surely have been bankrupted.

    As my children become too old to remain on my insurance, I am glad that they–who all have preexisting conditions–will be able to get health insurance no matter what happens with their jobs. It is also fantastic that insurance companies can no longer drop people who get sick. What kind of insurance is that? And why would we want to repeal such a protective provision?

    As a woman I also appreciate that the insurance companies can no longer discriminate in their rates against women. There is mush else to admire in this bill, although of course much could be improved. It would be nice to see Republicans and Democrats working TOGETHER in Congress for improvements.

    As you mention, it’s not a sure thing yet, because a new Congress in the fall could wipe it all away and put nothing in its place, which would be a sad step backward. I hear vague rumblings about “other options,” but I’ve not heard what the other options are. I would be very interested to hear the specifics of the Republican plan for covering 30 million of our fellow citizens if they, as they promise to do, repeal the Affordable Care Act. I have read widely and haven’t found a single concrete Republican plan that might actually be able to be enacted as a law. If you know of one (specifics please), I would like to learn about it.

    Great job explaining the law.

  3. mary d

    But We American Citizens continue to pay for all the Illegals health care and school – and that sucks!

  4. Larry Rehbaum

    Dr. Kamaroff, are you a member of the American Medical Association?

  5. Medicare Supplement

    Does it have any effect on Medicare Supplemental Insurance?

  6. Sonia Conly

    The comments below generally do not seem to address the fundemental question: Should American citizens of all ages have access to roughly the same level of health security that elderly citizens do? If one believes that this is the case then the “Act” goes a long way toward achieveing that. There is a diversity of systems in other industrialized countries and the citizens of most of those countries seem to find the system in their own country satisfactory. While the US probably leads in inovative treatment it lags in delivering care for many groups and as I senior myself in my view unfairly redistributes income from the young to the old. The Act is second or third best for a lot of people with varying views of first best.

  7. Eugene Buglewicz

    The Obamatax imposes the HIGHEST TAX BURDEN EVER IMPOSED ON THE MIDDLE CLASS in the history of this Country. This is the first step to a single-payer system (the Government) as expressed by President Obama to the SEIU several years ago. One needs only look at the bureaucratic systems, numbers and types of taxes and exceptions granted by the Administration to organizations being required to be serviced by Obamatax (note, the Unions are exempt!!). One need only look at the current government operations that serve the public: AMTRAC; Post Office; Social Security; Medicare and there are others. These are ALL inefficient and BROKE. Obamatax will result in rationing of medical care – yes, you can see a Dr., but your appointment is in 6 weeks. Your life-saving surgery will have to enter the waiting list for those with higher priorities. Check with Canadian physicians as to why they have fled to the U.S. to avoid this type of disaster. If you are elderly, you must meet the requirements for the “Quality Adjusted Life Year”, an insidious way to ration health care, to see if you will receive treatment or simply a “happy pill” to take you through to the end of your life. We out here in the hinter land call these the “Death Panels”. (Remember what Obama told the lady who asked about her mother needing a pace maker, but was 86? Obama said her mother would not qualify but be made comfortable for the rest of her life.) The pill is a cheaper way to treat your illness even though it will decrease your years. Yes, health insurance, and life, will become cheaper under the Obamatax. It is a blight on us as an American Society. I am disgusted by those in our Federal Government who have imposed this unjust and immoral burden on its citizens. No politician is admitting they voted for this Law. Why? It is probably the worst piece of legislation EVER passed by the Government. Obamatax must be overturned, and other options enacted to cover the “20 million” who are not served by insurance.

  8. Dave

    You know I always tried to give the other person a fair shake but now you make a statement like the one below

    These people lived an automobile accident, a heart attack, or a stroke away from becoming destitute.

    I have to tell you that I think you all up there on the hill are so full of shit to make a statement like that. Thousand of dollars I have spend trying to get a law sue settle with an insurance company for 8 plus years now. And you tell me you worried about those who are a auto, heart or stoke away from destitute. Even if everyone has health ins. They don’t pay the whole bill anyways and your left with a mountain of bills anyways. So this is just another way you get rich and we pay the bill. How about me I am a paycheck from being out on my ass and living in the street. But that’s ok as long as I pay for the health care cause if I don’t I get fined and that ok cause you don’t have to worry about that now do you.

  9. lilian Brown

    I am respectfully disagreed in some aspect of the Supreme Court’s decision.

    The mandatory health care will be a negative on our economy and to the citizens of the USA. Insurance is a profit gain and not a loss net for the company or anyone who is in the insurance career. It is about Greed, Money and Profit.

    Look at the Whole Health Care Reform. Let me tell you, there are a lot more parts that will be affecting everyone and their assets. Health Care Reform is only a quarter of the master plan. Everyone is distracted by the Health Care and not reading the rest to it.

    Health Care Insurance through the government is about Profit, Greed and Self-profit as well as elimination of citizens from the population.

    People do not have employment and they will be charging them penalties for not carrying health insurance.

    Who put us into this unemployment frenzy? Not the citizen, but the citizens will be reprimand for not having the $800 – $1500 per month for the government’s health care and become felonies. Many people cannot meet their bills now, how can they pay for health insurance.

    Money controls people’s minds, set motives, and kills one thoughts and the individualism of a person. I am sorry…there are many greedy people who want health care reform for the money not to have better health care.

    Give the citizens options…I do not want a crappy health care and I am paying others to have an excellent health care. I think something is wrong with this picture.

    I want excellent health care too and I should come first over everyone including our jurisdiction system. I have to take care me then others….Momma taught me much better than that “take care of yourself because no one will take care of you.”

  10. Harvey Grove

    Insurance companies are NOTHING BUT LEACHES. They drain our wallets and give NOTHING in return. Thet have been able to insert themselves into our life by claiming they provide something, however, I have not be enable to figure out what that is, to this day..

    They supposedly base premiums on the risk they take. I do not believe that. We are all gong to die, therefore, that is a big group and they have taught us that the bigger the group the less risk they take. Yet they insist on charging small businesses more than large groups. Is it because the small groups are not bargaining collectively. They hurt the small businesses and the people who work there. Meanwhile they keep building those big buildings.
    When figuring the premiums, Thet supposedly use actuarial figures, however, they add a few percent In case they make a mistake. When there is no mistake they call that PROFIT. As it was not needed to cover a mistake it is really insurance for themselves. Why not pass it on top policy holders for a reward for continuing to stay with the company. This makes the premium do what it is supposed to do. If no unexpected risk came up that year… They did NOT need it. Since they were not entitled to it ….pass it on to their customers as it was an OVERCHARGE that had nothing to do with RISK.

    (How’s that for a bumper sticker?);

  11. Lucy Cassidy

    This new law is definitely a step in the right direction. I find it disgusting that the richest nation in the world does not provide health care for all of its citizens. The problem will not be solved, however, until we get profit motive out of the equation. Insurance companies are making millions of dollars off the backs of insurance policy holders, yet they are reluctant to pay for many claims without a verbal war. We should have universal health care for all our citizens and the cost to taxpayers would probably be less than we pay for insurance coverage now. Insurance companies would have to find another way to bilk citizens.

  12. Skylor

    This was a very clear post that helped me understand a lot about health care. I avoid reading about health care because it usually seems like articles are about politics, not about whether or not I am going to be able to afford health insurance as a regular bike commuter, rock climber, and automobile driver… all of which should never be done without insurance. Thanks for listing the perks and the punches. Cheers!

  13. rb

    here’s a thought — how will this law be enforced for those who still do not buy health insurance? “a stiff penalty” will not be the answer as they simply won’t/can’t pay. i agree people cannot get a free ride off of others, but i don’t think this will solve the problem.

    what about a limit on how much insurance companies can raise the premiums each year? i’m a sole proprietor, and every year my insurance increases ~$100/month, that’s $1200/year increase! my health insurance is and has always been by far the biggest expense i have…. i’m looking for an answer. ironically, i’m a health care provider and over the years insurance companies have cut my rates by 25%, lowering my income, yet have increased my costs.

    • ss

      Thousands of additional IRS agents are being hired to make sure that everyone pays. This will increase the number of people employed in the government, not the private sector!
      That’s all we need — more government employees so we can pay their salaries, pensions and other benefits!! Such a deal!!

  14. Anonymous

    It seems that a lot of people wanted this to fail because they didn’t like Obama. I see it that it will overall help the American people in the long haul. I don’t know what other people think but we will see when the time comes of course. This is only my opinion.

  15. Milton O'Dell

    Your information certainly corrected a lot of misconception i got from social media.

  16. Harris Tom

    While the courts and political representatives debate over hypothetical outcomes, companies in Silicon Valley and elsewhere are actually doing something to change the paradigm and help bring healthcare up to date. Just this morning I found out about HealthTap on this interview and I must say I’m impressed.

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