Obama's Affordable Care Act

29 May 2012

From left to right: Dr David Smith, Professor Lawrence Gostin, The Dean, Professor Gillian Triggs and Professor Roger Magnusson

The pending United States Supreme Court decision about the constitutionality of President Obama's universal health care legislation is the most important decision since Bush v Gore, and the most important American judicial decision about health in a generation, according to Professor Lawrence Gostin from Georgetown University's Law Center.

Delivering a Dean's distinguished lecture at Sydney Law School on 23 May, in an event co-hosted with the United States Studies Centre, Professor Gostin pointed out that President Obama's Affordable Care Act ensures nearly universal health insurance coverage for the first time in American history.

Currently, around 15% of Americans have no health insurance; many more are underinsured, and inability to pay health care bills is the leading cause of bankruptcy in the United States.

Although the Affordable Care Act does not significantly reduce the cost of health care, nor increase its quality, "its biggest advance is to have America join the civilised world in providing access to health care for virtually everyone".

The Act achieves this goal by expanding Medicaid (a joint state and federal-funded health insurance program), and by requiring uninsured individuals on higher incomes to purchase health cover.

This latter requirement is called the "individual mandate".
In his lecture, Professor Gostin reviewed the key arguments challenging the constitutionality of the Act.

Firstly, if the individual mandate is deemed to be a tax, it cannot be challenged until the Act actually comes into operation in more than a year from now.

However, Professor Gostin doubted whether the Supreme Court will delay hearing the case on these grounds.

Secondly, 26 States have challenged the Act on the basis that individuals who refuse to purchase health insurance are "doing nothing", and that Congress lacks the power to regulate individual choices under the interstate commerce clause. On the other hand, as Professor Gostin explained, it would be odd indeed to hold that the interstate commerce clause does not support the individual mandate when health consumes 17% of the American economy, and heavily impacts interstate commerce.

Thirdly, the States are arguing that the expansion of Medicaid coverage really amounts to a form of economic coercion. On the other hand, if the States do not wish to expand Medicare, they are free not to take the federal money.

Finally, if the individual mandate is struck down, the Court must also decide whether this can be severed from the rest of the legislation, or whether the entire Act will be invalidated. Without the individual mandate, however, the young and healthy would leave the insurance pool, and the costs of health care would skyrocket for those remaining in it.

The central goal of universal health insurance coverage would also be lost.
The states are high, as Professor Gostin explained, because if all or part of the Affordable Care Act is struck down, President Obama will probably be unable to successfully introduce another reform, even if he is re-elected.

As a result, health care reform could be a non-started for many years to come.
Responding to Professor Gostin's lecture, Dr David Smith, Lecturer in American Politics and Foreign Policy at the United States Studies Centre made the telling point that although President Obama's health care reforms are now under constant attack from Republicans, they were based on Massachusett's universal health care legislation previously introduced by Mitt Romney, during the time he was a republican governor.

Sydney Law School offers a Master of Health Law (MHL) degree and a range of units with a strong focus on American Law:

More information about the Master of Health Law Program

More information about the Centre for Health Governance, Law & Ethics

For For more information about the health law teaching program, contact its Director, Associate Professor Kristin Savell or the Director of the Centre for Health Governance, Professor Cameron Stewart, or Professor Roger Magnusson.

For application forms and other information about enrolment, contact Ms Sue Ng, head of the postgraduate team.

Contact: Professor Roger Magnusson

Phone: +61 2 9351 0211

Email: 061e4830087f2f1b323a1c19123d3e2d151d522a023e1e2f3537444a47