US Supreme Court Upholds Indian Health Law and Larger Obama Health Law

Rob Capriccioso
6/28/12

This story will be updated throughout the day.

WASHINGTON – In a major victory for the Obama administration, the individual mandate of the Affordable Care Act (ACA) of 2010 has survived under the taxing power of the Congress, according to a widely anticipated decision handed down by the U.S. Supreme Court on June 28. Also surviving is the Indian Health Care Improvement Act (IHCIA), which was part of the larger law and paved the way to permanently reauthorize some important federal and tribal Indian health-related programs and funding pathways.

The individual mandate, which requires most Americans to purchase healthcare insurance, was the most controversial part of the law. In an unexpected move, Chief Justice John Roberts joined the left-leaning members of the court in a 5 -4 vote, saying that that portion could not be upheld under the Commerce Clause of the Constitution, but it could be upheld under the Congress’ taxing authority.

In effect, the court said that individuals subject to the mandate may legally waive health insurance and thus pay increased taxes, or buy health insurance and pay less taxes.

“Our precedent demonstrates that Congress had the power to impose the exaction in Section 5000A under the taxing power, and that Section 5000A need not be read to do more than impose a tax,” Justice Roberts wrote in the decision. “This is sufficient to sustain it.”

Justice Ruth Bader Ginsburg wrote in her own opinion that the vote was 5-4 on keeping the mandate as a form of tax. She added that she also would have upheld the mandate under the Commerce Clause.

Under the greater law, American Indians were exempt from the individual mandate, so this part of the decision is moot to those Indians who were not planning to buy insurance under the plan.

On the Medicaid expansion part of the law, a majority of the court held that the plan is constitutional, but that it would be unconstitutional for the federal government to withhold Medicaid funds to states not complying with the expansion provisions. That’s because federal law requires that states have a choice on whether to participate in the expansion of eligibility.

"Nothing in our opinion precludes Congress from offering funds under the ACA to expand the availability of health care, and requiring that states accepting such funds comply with the conditions on their use,” Justice Roberts wrote on the Medicaid issue. “What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding."

As for the IHCIA, the court accepted it by default, because it did not have to rule on severability issues, having upheld the greater law. Likewise, the provision requiring insurers to cover young adults until they are 26 was constitutional by default. In short, because the court saved the mandate, it did not need to decide what other parts of the statute were constitutional, except for a provision that required states to comply with new eligibility requirements for Medicaid or risk losing their funding, which is why they issued a decision on that matter.

The IHCIA provides broad support and funding for tribal health programs and for Indian citizens. Indian tribes and organizations led by the National Indian Health Board had argued before the high court that even if it chose to strike down the entire ACA, it should be able to legally sever and preserve the IHCIA language. Their brief to the court argued that the Indian-specific provisions were “legally separable” from the greater act, and were “related solely to the federal responsibility to provide health care to Indian tribes and their members.”

The upholding of IHCIA is a major victory for Indian country and for the Indian legal advocates who pressed the Obama administration and congressional Democrats to include the Indian health law in the greater health plan. Some in Indian country had previously argued that IHCIA should be stand-alone legislation, but the prevailing wisdom was that Congress in 2010 wasn’t going to be willing to vote on separate health programs for Indians at that time, so it was worth the try to get it attached to the larger bill, despite the fact that legal challenges to the larger bill were likely.

"This is a very significant victory for Indian country, especially when one considers how long it took to get the IHCIA reauthorized," said Jim Roberts, a policy analyst with the Northwest Portland Area Indian Health Board. "It would have been extremely difficult to get this bill done as a stand-alone piece of legislation for obvious reasons."

Roberts said many Indian health-related programs would have been harmed if the ACA had fallen. He noted that the IHCIA includes a provision that allows health-care professionals employed by tribally operated health programs to be eligible for state licensure exemptions (similar to exemptions available to federal employees) if they are licensed in another state. "If the ACA was struck down, it would have undone procedures that are being developed by the states to have tribes 'attest' or 'certify' that they meet licensing/certification criteria in health programs," he said. "The hiring and retention of many providers under this authority would have been undone."

Also safe under the ruling is the provision that says tribes can purchase insurance for individual members sans tax penalties.

"Taken together, the IHCIA and ACA will allow greater health benefits to many Indian people that do not have access to health care," Roberts said.

Joe Finkbonner, director of the Northwest Portland Area Indian Health Board, added that there are many provisions within the IHCIA that can be implemented immediately to help to clarify and justify the role of the IHS [Indian Health Service] within the context of the nation's overall health system. Along those lines, the National Congress of American Indians noted in a press release issued after the ruling that the IHCIA includes authorities for new and expanded programs for mental and behavioral health treatment and prevention; expanded authorities for long-term care services, including home health care, assisted living and community-based care; new authorities for development of health professional shortage demonstration programs; expanded authorities for funding of patient travel costs; new authorities for demonstration projects for innovative health care facility construction; new authorities for the provision of dialysis services; improvements in the Contract Health Services program, which pays for referrals; new authorities for facilitation of care for Indian veterans; and new authorities for urban Indian health programs.

Beyond improved health care for Indians, many see the situation as an important Native-focused legislative lesson. “This is a historic vindication for Congressmen Nick Rahall and George Miller who are longtime supporters of Indian country,” said Chris Stearns, a Navajo lawyer with Hobbs Straus Dean & Walker. “In the fall of 2009, they used their power as chairmen (and staked their reputations) in order to persuade House Speaker Nancy Pelosi to add the IHCIA to the health care reform bill.” At that time, current Natural Resources Committee Chairman Doc Hastings, R-Washington, wrote to then-Chairman Rahall objecting to the inclusion of the IHCIA.

“Words cannot express my gratitude to Chairman Rahall and Chairman Miller, who have been with us from the beginning as we worked together to address long-standing deficiencies in the delivery of Indian health care," Rachel Joseph, co-chair of the National Tribal Steering Committee for the Reauthorization of the Indian Health Care Improvement Act, said at the time. "We are elated that our long journey to reauthorize the Indian Health Care Improvement Act is one giant step closer to being realized, through the inclusion of this critical legislation in the House health insurance reform bill. This critical effort to modernize our health care delivery system will go a long way in improving the health status of those living in Native American and Alaska Native communities."

Upon reviewing the court's ruling, President Barack Obama said it was time to move forward, and told Americans what to expect on this matter in the coming days. An excerpt from his June 28 speech follows:

"First, if you’re one of the more than 250 million Americans who already have health insurance, you will keep your health insurance -- this law will only make it more secure and more affordable. Insurance companies can no longer impose lifetime limits on the amount of care you receive. They can no longer discriminate against children with preexisting conditions. They can no longer drop your coverage if you get sick. They can no longer jack up your premiums without reason. They are required to provide free preventive care like check-ups and mammograms -- a provision that's already helped 54 million Americans with private insurance. And by this August, nearly 13 million of you will receive a rebate from your insurance company because it spent too much on things like administrative costs and CEO bonuses, and not enough on your health care.

"There’s more. Because of the Affordable Care Act, young adults under the age of 26 are able to stay on their parent's health care plans -- a provision that's already helped 6 million young Americans. And because of the Affordable Care Act, seniors receive a discount on their prescription drugs -- a discount that's already saved more than 5 million seniors on Medicare about $600 each.

"All of this is happening because of the Affordable Care Act. These provisions provide common-sense protections for middle class families, and they enjoy broad popular support. And thanks to today’s decision, all of these benefits and protections will continue for Americans who already have health insurance.

"Now, if you’re one of the 30 million Americans who don’t yet have health insurance, starting in 2014 this law will offer you an array of quality, affordable, private health insurance plans to choose from. Each state will take the lead in designing their own menu of options, and if states can come up with even better ways of covering more people at the same quality and cost, this law allows them to do that, too. And I’ve asked Congress to help speed up that process, and give states this flexibility in year one.

"Once states set up these health insurance marketplaces, known as exchanges, insurance companies will no longer be able to discriminate against any American with a preexisting health condition. They won’t be able to charge you more just because you’re a woman. They won’t be able to bill you into bankruptcy. If you’re sick, you’ll finally have the same chance to get quality, affordable health care as everyone else. And if you can’t afford the premiums, you'll receive a credit that helps pay for it."

Earlier ICTMN coverage of the IHCIA reauthorization:

Lawyer Reflects on Supreme Court and Indian Health Law

Indian Health Law in Danger at Supreme Court

Indians Plan to Protect Health Law at Supreme Court

Indian Specific Health Care Provisions Must Stay

Tribes File to Protect Indian Health Law

Q&A With Retired Senator Byron Dorgan

Why the Worry About IHCIA Repeal is Overblown

The Year IHCIA Became Permanent

A Legislative Lesson: The Making of IHCIA

IHCIA Passes Despite GOP Abortion Controversy

Indian Health Bill on Brink of Passage

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