By Lisa Esposito
THURSDAY, March 22 (HealthDay News) -- The most ambitious government health-care initiative since the Medicare and Medicaid programs of the 1960s, and the legislative landmark of President Barack Obama's presidency, is about to face its biggest challenge.
Starting Monday, the U.S. Supreme Court will hear an unprecedented six hours of arguments over three days on the constitutionality of the controversial and massive health-reform initiative known as the Affordable Care Act.
The law -- the first national legislative effort to rein in health-care costs -- aims to extend insurance coverage to more than 30 million Americans through an expansion of Medicaid and a provision that people buy health insurance starting in 2014 or face a penalty.
"There are 50 million people in this country who don't have health insurance. The Affordable Care Act will probably extend coverage to an estimated 30 to 32 million of those people," said Renee Landers, a professor at Suffolk University Law School in Boston.
The key sticking point in the legal showdown is whether Congress exceeded its authority with the law's so-called "individual mandate," which requires almost all adult Americans to maintain health insurance or risk a penalty in the form of a tax.
The individual mandate -- scheduled to take effect in January 2014 -- is the pivotal piece of the law.
"The requirement that people purchase insurance is the key to having health insurance be there for everyone when they need it," said John Rother, president of the National Coalition on Health Care, which works to achieve reform of the U.S. health-care system.
Opponents call the mandate a stunning government intrusion into the private lives of Americans and argue that Congress has no right to tell an individual to buy a certain product.
Grace-Marie Turner, president of the Galen Institute, a conservative public policy group, and a critic of the new law, is thrilled that the High Court has agreed to hear challenges to the legislation.
"This case is before the Supreme Court in record time. Two years from the law being enacted to the case being heard is really remarkable," Turner said. "And you have 26 states -- the majority of states -- challenging the law."
The Supreme Court will also hear arguments on whether the law is unconstitutional in requiring states to either comply with an expansion of Medicaid to cover more lower-income people without health insurance, or lose federal matching funding. At issue is the concept of "federalism," the division of powers between the federal and state governments.
Finally, the court will address "severability" -- that is, whether the individual mandate can be struck down while leaving the rest of the law intact.
In a recent New England Journal of Medicine commentary, Landers described arguments for and against severability.
Opponents have said that provisions of the legislation are too intertwined for the law to stand without the individual mandate. The Obama administration has said the law can still work without the mandate, but provisions such as prohibiting insurance companies from denying coverage to people with preexisting conditions would be greatly compromised without the mandate.
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Here's how the health-reform law is designed to provide health insurance to uninsured Americans:
- Individual mandate. It requires most adults to purchase health insurance or pay a tax penalty. By 2016, the phased-in penalty will reach either $695 or 2.5 percent of yearly taxable income, whichever is greater. People with incomes below tax-filing thresholds will be exempt from the provision. Up to 16 million people are projected to join the rolls of the insured under the mandate.
- Medicaid expansion. This would increase eligibility to all people under age 65 with annual incomes up to 133 percent of the federal poverty level -- about $14,850 for a single adult and $30,650 for a family of four in 2012. Non-disabled adults under 65 without dependent children were previously ineligible. Another 16 million people are estimated to gain insurance under the expansion.
- State-run insurance exchanges. They will be created to help small businesses and individuals purchase insurance through a more organized and competitive market.