Obamacare’s Insurance Rule Is Upheld by Supreme Court
By CNBC | CNBC – 5 minutes ago
The Supreme Court, in a landmark ruling Thursday, upheld the individual insurance requirement at the heart of President Barack Obama’s health care overhaul.
The court on Thursday handed Obama a campaign-season victory in rejecting arguments that Congress went too far in requiring most Americans to have health insurance or pay a penalty.
Chief Justice John Roberts announced the court’s judgment that allows the law to go forward with its aim of covering more than 30 million uninsured Americans.
The court, however, found problems with the law’s expansion of Medicaid, but even there said the expansion could proceed as long as the federal government does not threaten to withhold states’ entire Medicaid allotment if they don’t take part in the law’s extension.
The court’s four liberal justices, Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan and Sonia Sotomayor, joined Roberts in the outcome. Justices Samuel Alito, Anthony Kennedy, Antonin Scalia and Clarence Thomas dissented.
Stocks of hospital companies moved sharply higher on the decision, including HCA Holdings (HCA) and Community Health Systems (CYH).
Stocks of drug companies and medical device makers are slightly lower for the day as analysts sort through the Supreme Court’s ruling. Stocks of the biggest insurance companies are also lower.
The ruling on Obama’s sweeping federal health care law will shape the contours of the presidential campaign through the summer and fall. Both Obama and Republican rival Mitt Romney are primed to use the outcome for political gain.
Before the decision, Obama has expressed confidence the court will uphold his signature legislative initiative.
Obama recently avoided mentioning the impending court ruling directly, but he has vigorously defended the health-care overhaul as critical to the public’s health and well-being in campaign events this week.
“I think it was the right thing to do. I know it was the right thing to do,” he told supporters in Boston.
Romney, who as Massachusetts governor signed a health care law on which the Obama’s federal law was modeled, has focused more than usual on the Supreme Court ruling this week.
Polling suggests that most Americans oppose the law, but an overwhelming majority want Congress and the president to find a new remedy if it’s struck down. Romney so far has spent little time crafting a comprehensive plan to replace the overhaul.
And the Obama campaign already has seized on Romney’s opposition to the most popular provisions in the law. For example, Romney would not prevent health-care companies from denying coverage to new customers with medical conditions. Nor would he force them to cover young adults on their parents’ plans through age 26.
Still, both sides will use it to raise money and motivate supporters.
And outside groups are ready to unleash a flood of advertisements following the ruling, including a 16-state, $7 million ad buy from the conservative political action group Americans for Prosperity