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Big legal setback for Obama's health care overhaul

Discussion in 'International Forum' started by Rutashubanyuma, Dec 14, 2010.

  1. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Big legal setback for Obama's health care overhaul

    [​IMG] AP – President Barack Obama makes a statement on the tax cut bill at the White House on Monday, Dec. 13, 2010, …


    By MARK SHERMAN and ERICA WERNER, Associated Press Mark Sherman And Erica Werner, Associated Press – Mon Dec 13, 9:44 pm ET
    WASHINGTON – President Barack Obama's historic health care overhaul hit its first major legal roadblock Monday, thrown into doubt by a federal judge's declaration that the heart of the sweeping legislation is unconstitutional. The decision handed Republican foes ammunition for their repeal effort next year as the law heads for almost certain eventual judgment by the U.S. Supreme Court.
    The ruling by U.S. District Judge Henry E. Hudson, a Republican appointee in Richmond, Va., marked the first successful court challenge to any portion of the new law, following two earlier rulings in its favor by Democratic-appointed judges.
    The law's central requirement for nearly all Americans to carry insurance is unconstitutional, well beyond Congress' power to mandate, Hudson ruled, agreeing with the argument of Virginia's Republican attorney general — and many of the GOP lawmakers who will take control of the U.S. House in January. Hudson denied Virginia's request to strike down the law in its entirety or block it from being implemented while his ruling is appealed by the Obama administration.
    "An individual's personal decision to purchase — or decline to purchase — health insurance from a private provider is beyond the historical reach of the Commerce Clause," said Hudson, a 2002 appointee of President George W. Bush.
    Nevertheless, the White House predicted it would prevail in the Supreme Court, although it may be a year or two before the health care law gets there. The next step for the Virginia lawsuit is the 4th U.S. Circuit Court of Appeals in Richmond, where Democratic-appointed judges hold a majority.
    In an interview with television station WFLA in Tampa, Fla., on Monday, Obama emphasized that other judges had either found the law constitutional or dismissed lawsuits against it.
    "Keep in mind this is one ruling by one federal district court. We've already had two federal district courts that have ruled that this is definitely constitutional," Obama said. "You've got one judge who disagreed. That's the nature of these things."
    But in the short term, the latest court ruling hands potent ammunition to GOP opponents as they prepare to assert control in the new Congress with promises to repeal the law. Obama in turn has promised to veto any repeal legislation and appears likely to be able to prevail since Democrats retain control of the Senate. Republicans also have discussed trying to starve the law of funding.
    Whatever the eventual outcome, Monday's ruling could create uncertainty around the administration's efforts to gradually put into effect the landmark legislation extending health coverage to 32 million uninsured Americans. And it can only increase the public's skepticism, which has not significantly receded in the months since the law's enactment, defying Obama's prediction that it would become more popular as the public got to know it.
    Obama aides said implementation would not be affected, noting that the individual insurance requirement and other major portions of the legislation don't take effect until 2014.
    Underscoring the potential for Hudson's ruling to become a political cudgel for the new Republican House majority, incoming House Speaker John Boehner, R-Ohio, quickly cautioned states against "investing time and resources in Obamacare's implementation now that its central mandate has been ruled unconstitutional."
    "Republicans have made a pledge to America to repeal this job-killing health care law, and that's what we're going to do," said Boehner. Calls to repeal the law were a staple of tea party campaign rallies this year.
    Other lawsuits are going forward, including one by 20 states that gets under way Thursday in Florida. That suit also challenges whether the federal government can require states to expand their Medicaid programs.
    The suit that was decided on Monday had gained a high profile because it was pursued by Virginia's outspoken attorney general, Ken Cuccinelli. The two earlier cases decided in favor of the administration were brought by little-known legal entities.
    In his ruling, Hudson largely agreed with Cuccinelli's argument that Congress exceeded its authority, and he dismissed the Justice Department's argument that the insurance-buying requirement would come under the definition of regulating interstate commerce, a power given to Congress by the Constitution.
    The mandate for people to buy insurance "is neither within the letter nor the spirit of the Constitution," the judge said.
    Hudson limited his ruling to striking down the so-called individual mandate, leaving intact other portions of the law — something supporters cast as a victory. But administration officials and outside analysts agree that important provisions of the legislation could not go forward without the requirement for everyone to be insured. That's because insurers need to have large pools of healthy people, who are cheap to insure, or it is not financially tenable for them to extend coverage to anyone with a pre-existing condition or guarantee certain policies to nearly all comers.
    Some provisions of the law took effect in September, six months after its passage, including free preventive care, an elimination of lifetime limits on coverage and a requirement for insurers to allow adult children to stay on their parents' health plans until age 26.
    Hudson recognized that his would not be the last word on the subject.
    "The final word will undoubtedly reside with a higher court," he wrote.
    White House health reform director Nancy-Ann DeParle said the administration is encouraged by the two other judges — in Virginia and Michigan — who have upheld the law. She said the Justice Department is reviewing Hudson's ruling.
    In contrast to Hudson's ruling, the judges in Michigan and Virginia, both appointed by President Bill Clinton, said the purchase requirement was allowable under the Constitution.
     
  2. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Tatizo la Marekani nu kuwa maamuzi ni ya kiitikadi zaidi ya kuangalia ukweli wa sheria zinasemaje................na kwa bahati mbaya kwa Obama supreme court ya Marekani imetawaliwa na Republicans appointees ambao wako 5 kati ya majaji 9........kwa hiyo aandike maumivu tu huko.......................

    Is this really change Americans can believe in...............
     
  3. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Tatizo la Marekani nu kuwa maamuzi ni ya kiitikadi zaidi ya kuangalia ukweli wa sheria zinasemaje................na kwa bahati mbaya kwa Obama supreme court ya Marekani imetawaliwa na Republicans appointees ambao wako 5 kati ya majaji 9........kwa hiyo aandike maumivu tu huko.......................

    Is this really change Americans can believe in...............
     
  4. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    News Analysis

    Just One Ruling, But an Outsize One

    By SHERYL GAY STOLBERG

    Published: December 13, 2010




    The strengths and weaknesses of a federal judge's decision rejecting the insurance mandate.




    But from a political standpoint, the only case that really matters is the one Mr. Obama lost on Monday.
    Judge Henry E. Hudson's decision leaves the White House playing defense for the foreseeable future on an issue it once thought would secure Mr. Obama's legacy. It provides another rallying point for conservatives as they make the case that government is overreaching and must be reined in. And as the Virginia case and others like it make their way through the appeals process and ultimately to the Supreme Court, it ensures that health care will remain a topic of intense debate in the new Congress and into the 2012 presidential campaign.
    Monday's ruling gives a boost to what Peter Wehner, who advised President George W. Bush on domestic policy, calls a "full-scale assault by the Republican Party and conservatives" on the measure. In Washington, Congressional Republicans are planning a symbolic vote to repeal the measure when they take control of the House of Representatives next month, and are vowing to chip away at it through financial cuts. Republicans say Judge Hudson's decision provides a legal underpinning for such efforts.
    "Judge Hudson's a serious judge and he has put into words, and into a legal decision, a fairly profound pronouncement, which is that a key element of Obama's health care plan is unconstitutional, and that's going to energize people at every level of government who oppose the law," said Mr. Wehner, now a fellow at the Ethics and Public Policy Center here. "Conservatives have been dealt a lot of setbacks from the judiciary and judges along the way; this one is a powerful ratification of the conservative world view, and it complicates things for the Obama administration."
    The ruling puts Mr. Obama on the defensive over health care at a time when he would rather be talking about the economy and forging a relationship with the newly empowered Republicans in Congress. And in addition to energizing Mr. Obama's critics on the right, the decision is reigniting a long-simmering debate on the left about whether he should have pushed for a government-run system to cover the uninsured, without the controversial mandate to buy insurance.
    White House officials consoled themselves Monday with the relative narrowness of the decision; Judge Hudson ruled only the mandate unconstitutional, and not the whole bill, though stripping out the mandate would undercut much of the bill's promise to expand access to health care while holding down costs.
    But Judge Hudson did give Republicans additional ammunition. In his ruling, he took lawmakers and the White House to task for characterizing the penalty facing people who refuse to buy insurance as a tax - a term the White House had been loath to use during the political debate. Republicans were ecstatic; Representative Trent Franks of Arizona predicted the decision would be the ‘'death rattle" of the health bill.
    For Mr. Obama, who opposed a mandate in the early stages of his presidential campaign, there was a certain irony in the ruling. His fellow Democrats insisted that while it might look like a victory for Republicans, it would galvanize their party as well.
    "The more heated this becomes, the more light there will be, because the more this is discussed, the more our country will realize that the status quo is simply unacceptable," Representative Sander M. Levin, Democrat of Michigan and outgoing chairman of the House Ways and Means Committee, said, adding Democrats would defend the bill at " "every juncture."
    But Democrats are also looking to the president to carry the fight forward with the same vigor he displayed before the bill's passage - a level of enthusiasm that might be hard for him to muster, given his political circumstances in the aftermath of the drubbing his party took in last month's midterm elections. Representative Jan Schakowsky, Democrat of Illinois, said Mr. Obama needed to become more aggressive about defending the measure he fought so hard to pass.
    "The president has to be the leader in very forcefully explaining and touting this bill because I think we need to take the offensive on this issue," Ms. Schakowsky said. "The next two years it's going to be all about leadership from the White House."
    Yet there is only so much the president can do. Mr. Obama still weighs in on health care from time to time, most recently when his administration announced new rules requiring insurance companies to spend at least 80 percent of health premium dollars on medical expenditures for patients. But, try as he might, he has been unable to bring the public to his side. Surveys do show that the some individual provisions of the law, such as barring insurers from denying coverage based on pre-existing conditions (a provision that would fall if the Virginia court ruling is upheld) and allowing young adults to stay on their parents' plans until they are 26, are broadly popular.
    But nine months after the bill's passage, Americans remain divided over whether to repeal it, according to the Kaiser Family Foundation, which tracks public opinion on the measure. Experts say that division is fueled by persistent confusion about just what the bill would do.
    "You have all these comments out there that it's a government takeover of health care, that it's going to be bad for seniors, that it's pulling the plug on grandma," said Jonathan Oberlander, a professor of health policy at the University of North Carolina. "That stuff has stuck politically, and it's evident in those numbers, in the very divided public support for reform."
    So long as Mr. Obama is president, Republicans' only real hope for undoing the health bill rests with the courts. The House repeal measure is all but certain to fail in the Senate, and even if it passed, Mr. Obama would veto it.
    For his part, the president sought to play down the significance of the court ruling in Virginia.
    "Keep in mind, this is one ruling by one federal district court," Mr. Obama said in an interview with WFLA, a Florida television station, adding: "You've got one judge who disagreed. That's the nature of these things."
     
  5. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    A Fatal Blow to Obama's Health Care Law?

    Introduction

    [​IMG]Alexa Welch Edlund/Richmond Times-Dispatch, via Associated Press Attorney General Kenneth Cuccinelli of Virginia, who filed a lawsuit challenging the new federal health care law, at a news conference in Richmond on Dec. 13.
    A federal district judge in Richmond, Va., ruled on Monday that the new health care law's provision requiring individuals to buy health insurance is unconstitutional. Judge Henry E. Hudson wrote that the requirement goes beyond Congress's authority under the Commerce Clause of the Constitution.
    Judge Hudson is the first jurist to in the country to invalidate part of the law, ensuring that the issue will reach the appellate courts. Two other federal judges - in Detroit and Lynchburg, Va. - have upheld the insurance mandate.
    What arguments are convincing -- or problematic -- in Judge Hudson's decision? And how might this ruling affect the politics surrounding the law?
     
  6. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    A Noxious Commandment

    December 13, 2010
    Randy Barnett is the Carmack Waterhouse Professor of Legal Theory at Georgetown Law Center and author of "Restoring the Lost Constitution: The Presumption of Liberty." He filed an amicus brief with the Cato Institute supporting Virginia's challenge to the Patient Protection and Affordable Care Act.
    The days of calling the constitutional challenges to the Affordable Care Act "frivolous" and "political" are now officially over. Judge Hudson's ruling that the individual insurance mandate is unconstitutional is a milestone in the legal process of deciding whether Congress has the power to command every person in the United States to enter into an economic relationship with a private company.
    If economic mandates like this one are allowed, Americans will be demoted from citizens to subjects.

    Until 2010, the only mandates ever imposed on American citizens pertained to their citizenship: register for the draft and serve if called, sit on a jury, file a tax return, respond to the census. In the U.S., one cannot even be commanded to vote.
    If economic mandates like this one are allowed, however, Americans will be demoted from citizens to subjects. They will have to obey any commands that Congress deems convenient to its regulation of interstate commerce. No more expensive tax credits and subsidies to raise taxes to pay for; Congress can just command you to buy its favored products. Forget cash for clunkers; just make Americans buy cars from G.M. Or make them undergo medical exams to save on health care costs. Gone will be a federal government of limited and enumerated powers established by the Constitution and repeatedly affirmed by the Supreme Court.
    In his ruling today, Judge Hudson recognized that such an unprecedented claim of power had never been sanctioned by the Supreme Court. Even Judge Steeh, the district court judge in Michigan who upheld the mandate in October, said this "arguably presents an issue of first impression."
    True, today's decision is just a single ruling by one judge. But had it gone the other way, cries that such challenges were frivolous and political would again have been heard from pundits, professors, and politicians. So today's ruling is big, both legally and atmospherically.
    On Thursday morning, the spotlight moves to Pensacola, Fla. where oral arguments on the challenge brought against the law by 20 attorneys general will be heard. Like Judge Hudson today, Federal District Court Judge Roger Vinson has already dismissed the government's invocation of its tax power on the merits, while signaling his skepticism about the government's Commerce Clause theory.
    If he now joins in striking down the individual mandate, I would not be surprised to see the next Congress and President Obama agree to "reform" the law by eliminating this constitutionally noxious mandate before the Supreme Court ever has a chance to rule.
     
  7. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Blinkered to Reality

    December 13, 2010
    Jack M. Balkin is Knight Professor of Constitutional Law and the First Amendment at Yale Law School. His latest book, with Reva B. Siegel, is "The Constitution in 2020."
    When uninsured individuals get sick, they borrow money from their families to pay for the costs of health care. They buy over-the-counter medicines. Above all, they go to emergency rooms and demand medical services. In 2008 these demands cost hospitals some $43 billion. All of these are significant effects on interstate commerce.
    The individual mandate is a tax imposed on people who do not purchase health care, and therefore constitutional.

    But according to Judge Hudson's decision striking down the individual mandate, these effects on commerce are completely irrelevant and Congress cannot take any of them into account. Congress cannot regulate uninsured individuals, Judge Hudson explained, because these individuals are not doing anything when they fail to buy insurance -- yet they are borrowing money, purchasing drugs, or visiting emergency rooms instead.
    This is pure sophistry. Such arguments are reminiscent of the constitutional struggles over the New Deal, when the Supreme Court's conservative majority argued that no matter how great an effect labor strikes had on the national economy, Congress could not regulate working conditions because their effects on interstate commerce were only indirect. Judge Hudson's decision is yet another example of a long line of formalist jurisprudence that is blinkered to reality.
    Judge Hudson's other major argument was that Congress cannot justify the individual mandate under its powers to tax and spend for the general welfare. The individual mandate is a tax imposed on people who do not purchase health care; it is part of the Internal Revenue Code and is collected by the I.R.S. However, Judge Hudson argued that Congress had no power to pass the individual mandate under the General Welfare Clause because Congress used the word "penalty" and not the word "tax."
    This is, if anything, even worse sophistry, a sort of constitutional game of Simon Says. To make his case, Judge Hudson was forced to dredge up jurisprudence from the court's Lochner Era, which has been discredited since the New Deal.
    Judge Hudson had long since tipped his hand, so the actual result was not unexpected. What was unexpected was the remarkable weakness of his arguments. Perhaps the Court of Appeals for the Fourth Circuit will remind Judge Hudson that this is not 1934.

    Topics: Health, Law, health care
     
  8. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    A National Concern

    Updated December 13, 2010, 07:30 PM
    David Orentlicher is a visiting professor of law at the University of Iowa College of Law and co-director of the Hall Center for Law and Health at the Indiana University School of Law-Indianapolis. He is the co-author of "Health Care Law and Ethics."
    Judge Henry Hudson's opinion is problematic in two important ways. It does not reflect the concerns that have influenced the U.S. Supreme Court's decisions about Congressional exercises of the Commerce Clause power. Moreover, the opinion does not reflect the judge's own concern with excessive governmental power.
    With the health care legislation, Congress is regulating the health care industry, and the Supreme Court has long recognized that as a matter of national concern.

    In the two key cases that Judge Hudson cites, Lopez and Morrison, the Supreme Court saw a federal government trying to regulate in areas that were matters of local concern: schools and crime. Because our Constitution established a national government of limited powers that would regulate only matters of national concern, the court invalidated the laws. With the health care legislation, however, Congress is regulating the health care industry, and the Supreme Court has long recognized that as a matter of national concern.
    In other cases, the Supreme Court has upheld laws that standing alone would raise constitutional questions but were permitted as part of broad and important regulatory programs. Thus, the court upheld a federal prohibition on the use of marijuana for medical purposes because the prohibition was an important part of the federal government's overall regulation of illicit drug use. Similarly, the requirement to purchase insurance is an important part of the federal government's overall regulation of the health care system.
    Finally, Judge Hudson's decision denies Congress a way to ensure universal access to health care that involves a smaller role for the government than would a leading alternative approach. For more than 40 years, the Medicare program has imposed a mandate to purchase hospital insurance for one's senior years from the federal government. The constitutionality of Medicare tells us that Congress also could adopt a Canadian-style, "Medicare-for-All" health care system. From a perspective of individual liberty, however, it would be far better to require people to obtain their insurance from a private health care system than from a government system.
     
  9. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    The Problem With Broad Definitions

    December 13, 2010
    Ilya Somin is an associate professor at George Mason University School of Law.
    Judge Henry Hudson's decision today struck down as unconstitutional the "individual mandate" included in the health care bill enacted earlier this year; the mandate requires most Americans to purchase government-approved health insurance plans by 2014. The most powerful parts of Judge Hudson's ruling reject the federal government's arguments claiming that the mandate is justified by Congress' powers to impose taxes and regulate interstate commerce.
    Upholding the individual mandate would give Congress virtually unlimited power to mandate anything it wants.

    The text of the Commerce Clause gives Congress authority to regulate interstate commerce. But the individual mandate regulates that which is neither commercial nor interstate. Virtually all purchases of health insurance are intrastate because a combination of state and federal law makes it illegal to purchase health insurance across state lines. Moreover, the object of the mandate isn't even commerce at all. Instead of regulating pre-existing commerce, the bill forces people to engage in commercial transactions they would have otherwise avoided.
    Supreme Court decisions have expanded Congress' Commerce Clause authority to cover virtually any "economic activity." But the insurance mandate goes well beyond this. Far from engaging in "economic activity," people who decide not to purchase health insurance are actually refraining from doing so.
    The federal government claims that forcing people to purchase health insurance regulates economic activity because everyone eventually uses health care in some form. But as Judge Hudson points out, "the same reasoning could apply to transportation, housing, or nutritional decisions. This broad definition of the economic activity subject to congressional regulation lacks logical limitation." The same reasoning would give Congress the power to force everyone to purchase a car because everyone eventually uses some form of "transportation."
    Judge Hudson is equally persuasive in rejecting the argument that the mandate is authorized by Congress' power to impose taxes. As he notes, it is actually a financial penalty for refusing to comply with a regulation. In September 2009, President Obama himself stated that "to say that you've got to take a responsibility to get health insurance is absolutely not a tax increase." He was right. If the mandate qualifies as a tax merely because it punishes violators with a fine, then Congress could require Americans to do almost anything on pain of having to pay a fine if they refuse.
    Upholding the individual mandate would give Congress virtually unlimited power to mandate anything it wants. As Judge Hudson recognized, such an outcome is both dangerous and unconstitutional.
     
  10. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Being Uninsured Affects Others

    Updated December 13, 2010, 06:51 PM
    Timothy S. Jost is the Robert L. Willett Family professor of law at Washington and Lee University. He is co-author of a widely-used textbook on health care law.
    The Justice Department has won 14 cases challenging the Patient Protection and Affordable Care Act and has now finally lost one. Judge Hudson held that the statute’s requirement that uninsured individuals who can afford health insurance and who do not have a religious objection to insurance purchase basic health insurance coverage violated the Constitution. Judge Hudson held that this requirement exceeded the power of Congress under the Commerce Clause because it does not regulate economic “activity.”
    The decision to not buy insurance is commerce, and Congress can regulate it.

    Judge Hudson has effectively rewritten the Commerce Clause, which nowhere contains the word “activity.” This is a version of an argument that has been rejected before. In two major Commerce Clause cases, Wickard v. Filburn and Gonzales v. Raich, the party challenging the statute claimed to be outside of the stream of commerce, but the Supreme Court held that the party nevertheless had an effect on interstate commerce.
    The decision not to insure is not “inactivity,” as Judges Norman K. Moon and George Caram Steeh have already held in other federal court cases raising the same issue.
    None of us can choose not to become sick or injured. If individuals choose not to buy insurance and then need health care, they will either buy insurance then (which they will be able to do once preexisting condition clauses are outlawed) or simply receive the care, pay for what they and, and pass the remaining costs on to the taxpayers and to responsible persons who insure. This happens each year to the tune of tens of billions of collars. The decision to not buy insurance is commerce, and Congress can regulate it.
    Fortunately, Judge Hudson only entered a declaratory judgment, and held that the mandate provision was severable from all of other provisions of the law that are directly dependent on it and make specific reference to it. There are no such provisions, so the rest of the law remains in place. Also, this is just one more district court opinion. The courts of appeals, and perhaps the Supreme Court, will have to sort this out. Unless the Supreme Court deviates significantly from its earlier decisions, it will uphold the law as constitutional.
     
  11. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Give It More Money

    Updated December 6, 2010, 09:32 AM
    Harold Pollack is professor of social service administration at the University of Chicago, where he is faculty chairman of the Center for Health Administration Studies.
    Like Medicare and like private insurance, Medicaid can be administered more effectively, more diligently, and more informed by the best available comparative effectiveness research. Many states have become much more aggressive in their quality improvement. Although one should not overstate the current evidence base, well-implemented disease and care management models like Community Care of North Carolina's asthma and diabetes efforts show promise in improving quality and lowering costs among high-cost beneficiaries. State and federal law enforcement are more effective than they used to be in detecting fraud.
    With state budgets in trouble and Americans losing employer-based health insurance, federal support for Medicaid should increase.

    Without detracting from the importance of such efforts, I believe it is important to reject two main premises that underlie much public debate about Medicaid, and that are now part of the deficit reduction debate.
    First, it is not necessary or wise to arbitrarily curb Medicaid spending growth. Medicare and Medicaid expenditures are often wrongly lumped together as a common budget challenge. In fact, the challenges are quite different within the two programs.
    Properly viewed in the national context, projected spending on Medicaid and related programs will be quite manageable for years to come. Current federal spending on Medicaid and the Children's Health Insurance Program is about 1.8 percent of gross domestic product. The Congressional Budget Office estimates that federal spending on Medicaid, CHIP, and the new health insurance exchanges will reach 2.8 percent of G.D.P. by 2020 and 3.8 percent by 2035. I have not seen solid corresponding forecasts for state Medicaid expenditures. These could plausibly add another two percentage points to that 2035 figure.
    These are deeply un-frightening numbers, particularly in light of the projected near-doubling of overall U.S. health care expenditures by 2035, and in light of much scarier projections of Medicare spending growth over the same period, and beyond.
    Viewed at the level of the individual patient, Medicaid spending may even be too low. Medicaid reimbursements lag behind other payers, many services like dental care are not covered, and the low reimbursements create huge problems for urban hospitals and other providers.
    Medicaid is also the safety valve for other parts of the American health care financing system. When employer-based coverage shrinks, Medicaid expenditures increase. When large private carriers step away from long-term care insurance, Medicaid must fill that breach, too.
    Capping or constraining the federal portion of Medicaid is a particularly bad idea. This shifts financial burdens, risks, and deficits onto states that already lack the fiscal capacity to run Medicaid well. Many states do not provide the resources required to treat recipients properly. At the same time, rising Medicaid burdens lead states to cut other spending on education, public health, and social services to vulnerable populations.
    Right now, as states deal with declining revenues and in some cases legal requirements to balance budgets, they are trying to cut Medicaid services during a deep recession - precisely when the need for Medicaid is greatest and when the overall economy requires counter-cyclical public spending to get people back to work.
    Indeed, now is the time to consider a substantial increase in federal responsibilities and funding for Medicaid to address the programmatic and the macroeconomic shortcomings of a state-federal partnership that no longer works.
    Rather than capping federal Medicaid spending or overall Medicaid expenditures, we should focus on running Medicaid more effectively. In the short-run, the federal government should extend some of the Medicaid supports provided to states as part of last year's stimulus, and should assist states establish strong links between Medicaid and the new health insurance exchanges.
    Medicaid doesn't stand outside of the health care system. If we want to control Medicaid spending, we will need to pursue broader efforts to improve the overall system's economy and quality. If we fail in that broader task, rising Medicaid costs will be the least of our problems.
     
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    Rutashubanyuma JF-Expert Member

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    Introduction

    [​IMG]Jessica Kourkounis for The New York Times
    With federal stimulus money drying up soon, states are desperate to find ways to cut their Medicaid costs.
    Some analysts have pointed to changes in Tennessee and a number of other states as proof that the nation's health care program for the poor can be maintained while being made more cost-effective. In New York, Andrew Cuomo, the governor-elect, is already in talks with the health care union over reining in Medicaid's costs, which have tripled in the last decade. In some states, cuts have caused an uproar, as in Arizona, which eliminated some high-risk transplants from coverage.
    The president's deficit commission had floated the idea of putting a cap on the federal share of Medicaid long-term care costs. But the panel backed off in its final report, disappointing fiscal conservatives, who are bound to press in Congress for deeper cuts. What should Washington and the states do to make Medicaid more effective, while caring for the low-income Americans who need it?
     
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    Rutashubanyuma JF-Expert Member

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    The Eligibility Explosion

    Updated December 6, 2010, 01:00 PM
    Matthew Mitchell is a research fellow with the Mercatus Center at George Mason University.
    Medicaid is the major budget-buster at the state level. As a share of the typical state budget, the program consumes about twice what it did two decades ago. The program's funding formula encourages this: Medicaid is financed by a federal matching grant. This means that for each dollar a state adds to its Medicaid budget, the federal government will kick in from 1 to 3 additional dollars. This gives states an incentive to expand beyond the point where additional costs begin to exceed benefits.
    The federal financing formula gives states a perverse incentive to expand Medicaid beyond the point where additional costs begin to exceed benefits.

    Adjusting for growth in health care prices, states increased spending on Medicaid by 116 percent from 1987 to 2007. From 2000 to 2007, The rate of Medicaid enrollment grew four times as fast as the general population. Once the recession hit, enrollment growth jumped to 8.5 percent in fiscal year 2010.
    Enrollment is up because many have lost their jobs or have had their incomes cut. But enrollment is also up because states have expanded eligibility. Before the recession began, from 2000 to 2008, 24 states expanded their Medicaid eligibility requirements. According to researchers at the Urban Institute, "higher-income parents and childless adults have been the two major expansion groups."
    In 2001, for example, New York adjusted its requirements so that the share of the state population eligible for Medicaid grew from 13 percent to 35 percent. The Kaiser Foundation reports that in 2010, 32 more states expanded eligibility requirements.
    In 2001, New York adjusted its requirements so that the share of the state population eligible for Medicaid grew from 13 percent to 35 percent.

    For the time being, the program's new enrollees have benefited. But states should be weary of making promises they can't keep.
    At its peak, Tennessee's program covered nearly a quarter of the state's population. In 2004, McKinsey and Company evaluated the program's viability. McKinsey reported that by 2008, the program would consume 36 percent of the state's budget and that "its cost growth in that year will represent 91 percent of new state tax appropriations." Tennessee's Democratic governor, Phil Bredesen, called the report "sobering." He scaled back the program, cutting 200,000 from the roles in just four months.
    Medicaid was designed to provide health care to the poor. And it should do that. But expanding coverage to higher income groups and childless adults makes it harder to fulfill Medicaid's core mission. States looking to control costs are constrained by the perverse incentives of the federal matching formula.
    Former President Clinton's budget director, Alice Rivlin, teamed up with Republican Representative Paul Ryan to suggest the funding formula be converted to a block grant. This seems an eminently sensible step.
    As a quarter million Tennesseans found out, unrealistic promises benefit no one - least of all those who come to believe in them.
     
  14. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    The Eligibility Explosion

    Updated December 6, 2010, 01:00 PM
    Matthew Mitchell is a research fellow with the Mercatus Center at George Mason University.
    Medicaid is the major budget-buster at the state level. As a share of the typical state budget, the program consumes about twice what it did two decades ago. The program’s funding formula encourages this: Medicaid is financed by a federal matching grant. This means that for each dollar a state adds to its Medicaid budget, the federal government will kick in from 1 to 3 additional dollars. This gives states an incentive to expand beyond the point where additional costs begin to exceed benefits.
    The federal financing formula gives states a perverse incentive to expand Medicaid beyond the point where additional costs begin to exceed benefits.
    Adjusting for growth in health care prices, states increased spending on Medicaid by 116 percent from 1987 to 2007. From 2000 to 2007, The rate of Medicaid enrollment grew four times as fast as the general population. Once the recession hit, enrollment growth jumped to 8.5 percent in fiscal year 2010.
    Enrollment is up because many have lost their jobs or have had their incomes cut. But enrollment is also up because states have expanded eligibility. Before the recession began, from 2000 to 2008, 24 states expanded their Medicaid eligibility requirements. According to researchers at the Urban Institute, “higher-income parents and childless adults have been the two major expansion groups
    In 2001, for example, New York adjusted its requirements so that the share of the state population eligible for Medicaid grew from 13 percent to 35 percent. The Kaiser Foundation reports that in 2010, 32 more states expanded eligibility requirements.
    In 2001, New York adjusted its requirements so that the share of the state population eligible for Medicaid grew from 13 percent to 35 percent.
    For the time being, the program’s new enrollees have benefited. But states should be weary of making promises they can’t keep.
    At its peak, Tennessee’s program covered nearly a quarter of the state’s population. In 2004, McKinsey and Company evaluated the program’s viability. McKinsey reported that by 2008, the program would consume 36 percent of the state’s budget and that “its cost growth in that year will represent 91 percent of new state tax appropriations.” Tennessee’s Democratic governor, Phil Bredesen, called the report “sobering.” He scaled back the program, cutting 200,000 from the roles in just four months.
    Medicaid was designed to provide health care to the poor. And it should do that. But expanding coverage to higher income groups and childless adults makes it harder to fulfill Medicaid’s core mission. States looking to control costs are constrained by the perverse incentives of the federal matching formula.
    Former President Clinton’s budget director, Alice Rivlin, teamed up with Republican Representative Paul Ryan to suggest the funding formula be converted to a block grant. This seems an eminently sensible step.
    As a quarter million Tennesseans found out, unrealistic promises benefit no one — least of all those who come to believe in them.
     
  15. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Making States Responsible

    December 5, 2010
    Merrill Matthews is a resident scholar with the Institute for Policy Innovation in Dallas.
    Medicaid covers 48 million poor Americans with health insurance for children and non-disabled adults, and coverage for the disabled and long-term care. But states differ in who, what and how much is covered. California spends $969 per adult enrollee (2007) versus $5,108 in Alaska, and $3,473 per elderly person in Arizona versus $21,507 in Connecticut, according to the Kaiser Family Foundation.
    No excuses: Tennessee, Rhode Island and Florida have shown how costs can be contained.

    States would jump at a proposal to allow more flexibility in Medicaid, though many will groan at any suggestion to cap the program's open-ended federal matching grants.
    We have reason to believe this suggestion will work. Two years ago Rhode Island got a Medicaid waiver giving it more flexibility, while capping the federal government's share of the costs. The state claims its efforts have saved $150 million in 18 months.
    Florida has been a Medicaid reform leader for the disabled. Its "Cash and Counseling" program, which gives disabled people personal assistance accounts to choose their own caregivers, has been very popular. And more than a dozen states have adopted the program.
    Long-term care can provide significant savings if states crack down on eligibility. With more flexibility, states could lower the home equity that can be exempted - up to $750,000 in some states - and require a reverse mortgage before Medicaid will pay for a nursing home.
    As for health insurance, Gov. Phil Bredesen of Tennessee ended the state's extensive TennCare program, replacing it with CoverTN, which provides only basic coverage, including physician visits, preventive care and generic drugs at very low out-of-pocket costs. While the coverage is capped at $25,000 total annual benefits, it only costs about $1,800 a year.
    If Congress adopts a system of capping the open-ended federal role, it will begin a new era for the program, and most of the talk of opting out of Medicaid will disappear.
     
  16. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    The Workhorse of Health Care

    December 5, 2010
    Judith Solomon is co-director of health policy at the Center on Budget and Policy Priorities.
    Medicaid is the workhorse of the nation's health care system. It provides health coverage to about 58 million low-income Americans, covers almost half of the costs of long-term care for seniors and people with disabilities, and pays for 40 percent of all births. It provides critical services that people with disabilities and children with special health care needs require but that private insurance generally doesn't cover.

    Medicaid's average cost per beneficiary has grown no faster than the cost of private insurance over the last 30 years.

    Yet Medicaid's average cost per beneficiary has grown no faster than the cost of private insurance over the last 30 years. In fact, Medicaid actually costs less per individual than private insurance, when you adjust for Medicaid beneficiaries' poorer average health.
    Capping federal funding would cripple Medicaid and significantly shift costs to states, families, and doctors and hospitals. Facing inadequate federal funding, states would have to contribute more of their own funds or cut back eligibility, benefits and payments to health care providers. States would also be unable to cover the many families that lose their jobs and health coverage during a future downturn. (During the recent downturn, states struggled with the greater caseloads under the current financing structure and required even greater federal help.) And states would be unable to address large, unanticipated medical costs like those resulting from the H.I.V./AIDS epidemic they faced in the 1980s.
    While slowing Medicaid costs and improving efficiency are essential, the solution is not to cap federal funding. The health reform law takes a sounder approach, giving states new tools to take steps such as moving away from costly nursing home care to care in the community, and delivering health care to beneficiaries with chronic conditions in better and less costly ways. The health reform legislation also takes a number of other steps that hold considerable potential for slowing the long-term growth in health care costs system-wide.
     
  17. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Fraud and 'Fee for Service'

    Updated December 6, 2010, 12:49 PM
    Kerry Weems is senior vice president and health solutions general manager of Vangent, a consulting firm. He was a federal official for 28 years, mostly in the Department of Health and Human Services, and was administrator of the Centers for Medicare and Medicaid Services from 2007-2008.
    Medicaid is a leading contributor to states' fiscal crises. In many states, the program's costs exceed the combined budgets for primary and secondary education. In other states, Medicaid exceeds the costs for primary, secondary and post-secondary education. Medicaid is also the fastest growing portion of most state budgets, essentially crowding out other vital services.
    We know that broad-based cuts don't work. But adopting managed care will control costs while protecting people's health.

    A few states have taken a proactive stance by incorporating programs targeted toward controlling Medicaid costs while improving health outcomes. The most successful states have implemented managed care programs for their Medicaid populations as a means to improve health outcomes while controlling costs. The rest of the states remain mired in a "fee for service" payment model, essentially resulting in paying for health care by the yard.
    States can take three immediate actions to begin to address the Medicaid crisis and reign in skyrocketing health care costs:
    1) Proactive detection and prevention of fraud, waste and abuse. Audits conducted by the Centers for Medicare and Medicaid Services have shown that Medicaid fee-for-service payment error rates approach 25 percent in some states. Any Medicaid system that makes an error one of four times is extremely vulnerable to fraud.
    2) Move to pay-for-performance model. States that continue to use the fee-for-service model must convert to a payment model that rewards providers based on positive health outcomes versus just providing services.
    3) Prioritize dollars. Difficult changes need to be made to the Medicaid system itself. Dollars allocated to programs such as graduate medical education and disproportionate share hospital payments should be converted to quality health care for individuals.
    We know from hard experience that broad-based cuts to Medicaid providers simply don't work. When this happens, providers withdraw from the Medicaid program resulting in reduced access to care for a vulnerable patient population. Medicaid then becomes a false promise.
     
  18. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Years of Wrangling Lie Ahead for Health Care Law

    By KEVIN SACK

    Published: December 13, 2010





    By contradicting two prior opinions, Monday's court ruling in Virginia against the Obama health care law highlighted both the novelty of the constitutional issues and the difficulty of forging consensus among judges who bring differences in experience, philosophy and partisan background to the bench.




    [​IMG]
    Jay Paul

    Judge Henry E. Hudson's decision may boost conservatives.

    Multimedia

    [​IMG] Interactive Feature














    A Fatal Blow to Obama's Health Care Law?



    The strengths and weaknesses of a federal judge's decision rejecting the insurance mandate.



    Judge Henry E. Hudson of Federal District Court in Richmond wrote with conviction that the law's requirement that most Americans obtain insurance goes "beyond the historical reach" of Supreme Court cases that limit federal regulation of commercial activity. During the last two months, however, two other federal judges ruled with equal force that the provision fell squarely within the authority Congress was granted under the Commerce Clause of the Constitution.
    Ultimately, the Supreme Court will have to resolve the conflict, and many court watchers already expect a characteristically close decision. But what is now clear is that the challenges from dozens of states to the law's constitutionality can no longer be dismissed as frivolous, as they were earlier this year by some scholars and Democratic partisans.
    "All the insiders thought it was a slam dunk," said Randy E. Barnett, a professor of constitutional law at Georgetown University who supports the health care challenges. "Maybe a slam dunk like weapons of mass destruction were a slam dunk."
    The Supreme Court's position on the Commerce Clause has evolved through four signature cases over the last 68 years, three of which have been decided since 1995. Two of the opinions - Wickard v. Filburn in 1942 and Gonzales v. Raich in 2005 - established broad federal powers to regulate even personal commercial decisions that, taken in the aggregate, may influence a larger economic outcome.
    But two other cases - United States v. Lopez in 1995 and United States v. Morrison in 2000 - limited Congress's regulatory authority to "activities that substantially affect interstate commerce."
    The central question before the courts has not been whether the health care market substantially affects interstate commerce, a point largely accepted by all sides. Rather, the issue has been a semantic one: determining whether the act of not obtaining insurance is best defined as activity or, as Virginia's solicitor general, E. Duncan Getchell Jr., has argued in the Richmond case, "inactivity" that is beyond Congress's reach.
    Mr. Getchell, who argued the case for Virginia's attorney general, Kenneth T. Cuccinelli II, told Judge Hudson during an October hearing that if Congress could require the purchase of health insurance, there would effectively be no limits on federal power.
    Justice Department lawyers have responded that individuals cannot opt out of the medical market because they never know when they might be hit by a bus and require treatment. The act of not obtaining insurance, they contend, is thus an active decision to pay for health care out of pocket. Such individual decisions, when taken together, can shift billions of dollars in uncompensated care costs to governments, hospitals and the privately insured, and thus can be regulated.
    Judge Hudson, who was appointed by President George W. Bush, commented during the October hearing that the federal government's position would give Congress "boundless" authority to force Americans "to buy an automobile, to join a gym, to eat asparagus."
    On Monday, he formalized that view. "This broad definition of the economic activity subject to Congressional regulation lacks logical limitation and is unsupported by Commerce Clause jurisprudence," he wrote.
    Only two weeks earlier, Judge Norman K. Moon of Federal District Court in nearby Lynchburg, Va., found precisely the opposite. "Far from ‘inactivity,' " wrote Judge Moon, who was appointed by President Bill Clinton, "by choosing to forgo insurance, plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now, through the purchase of insurance." A second Clinton-appointed judge has upheld the law as well.
    Judge Hudson also rejected the federal government's secondary claim that it had authority to enact the insurance requirement under Congress's power to tax. That is because once the provision takes effect in 2014, the fine for not having insurance will be levied as an income tax penalty.
    That claim put Justice Department lawyers in the awkward spot of insisting that the provision constituted a tax, even though President Obama and other Democratic leaders adamantly denied during the legislative debate that they were raising taxes. Judge Hudson gave weight to those denials, and to the final bill's use of the word "penalty" to describe the fines, a change from earlier versions.
    Jack M. Balkin, a law professor at Yale who supports the act's constitutionality, noted that "there are judges of different ideological views throughout the federal judiciary" and said that the health care plaintiffs had helped their cause by filing lawsuits in conservative venues.
    Judge Hudson seemed content with the knowledge that his opinion would be one of many. "The final word," he wrote, "will undoubtedly reside with a higher court."
     
  19. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

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    Years of Wrangling Lie Ahead for Health Care Law

    By KEVIN SACK

    Published: December 13, 2010





    By contradicting two prior opinions, Monday’s court ruling in Virginia against the Obama health care law highlighted both the novelty of the constitutional issues and the difficulty of forging consensus among judges who bring differences in experience, philosophy and partisan background to the bench.




    [​IMG]
    Jay Paul

    Judge Henry E. Hudson’s decision may boost conservatives.

    Multimedia

    [​IMG] Interactive Feature














    A Fatal Blow to Obama’s Health Care Law?



    The strengths and weaknesses of a federal judge’s decision rejecting the insurance mandate.



    Judge Henry E. Hudson of Federal District Court in Richmond wrote with conviction that the law’s requirement that most Americans obtain insurance goes “beyond the historical reach” of Supreme Court cases that limit federal regulation of commercial activity. During the last two months, however, two other federal judges ruled with equal force that the provision fell squarely within the authority Congress was granted under the Commerce Clause of the Constitution.
    Ultimately, the Supreme Court will have to resolve the conflict, and many court watchers already expect a characteristically close decision. But what is now clear is that the challenges from dozens of states to the law’s constitutionality can no longer be dismissed as frivolous, as they were earlier this year by some scholars and Democratic partisans.
    “All the insiders thought it was a slam dunk,” said Randy E. Barnett, a professor of constitutional law at Georgetown University who supports the health care challenges. “Maybe a slam dunk like weapons of mass destruction were a slam dunk.”
    The Supreme Court’s position on the Commerce Clause has evolved through four signature cases over the last 68 years, three of which have been decided since 1995. Two of the opinions — Wickard v. Filburn in 1942 and Gonzales v. Raich in 2005 — established broad federal powers to regulate even personal commercial decisions that, taken in the aggregate, may influence a larger economic outcome.
    But two other cases — United States v. Lopez in 1995 and United States v. Morrison in 2000 — limited Congress’s regulatory authority to “activities that substantially affect interstate commerce.”
    The central question before the courts has not been whether the health care market substantially affects interstate commerce, a point largely accepted by all sides. Rather, the issue has been a semantic one: determining whether the act of not obtaining insurance is best defined as activity or, as Virginia’s solicitor general, E. Duncan Getchell Jr., has argued in the Richmond case, “inactivity” that is beyond Congress’s reach.
    Mr. Getchell, who argued the case for Virginia’s attorney general, Kenneth T. Cuccinelli II, told Judge Hudson during an October hearing that if Congress could require the purchase of health insurance, there would effectively be no limits on federal power.
    Justice Department lawyers have responded that individuals cannot opt out of the medical market because they never know when they might be hit by a bus and require treatment. The act of not obtaining insurance, they contend, is thus an active decision to pay for health care out of pocket. Such individual decisions, when taken together, can shift billions of dollars in uncompensated care costs to governments, hospitals and the privately insured, and thus can be regulated.
    Judge Hudson, who was appointed by President George W. Bush, commented during the October hearing that the federal government’s position would give Congress “boundless” authority to force Americans “to buy an automobile, to join a gym, to eat asparagus.”
    On Monday, he formalized that view. “This broad definition of the economic activity subject to Congressional regulation lacks logical limitation and is unsupported by Commerce Clause jurisprudence,” he wrote.
    Only two weeks earlier, Judge Norman K. Moon of Federal District Court in nearby Lynchburg, Va., found precisely the opposite. “Far from ‘inactivity,’ ” wrote Judge Moon, who was appointed by President Bill Clinton, “by choosing to forgo insurance, plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now, through the purchase of insurance.” A second Clinton-appointed judge has upheld the law as well.
    Judge Hudson also rejected the federal government’s secondary claim that it had authority to enact the insurance requirement under Congress’s power to tax. That is because once the provision takes effect in 2014, the fine for not having insurance will be levied as an income tax penalty.
    That claim put Justice Department lawyers in the awkward spot of insisting that the provision constituted a tax, even though President Obama and other Democratic leaders adamantly denied during the legislative debate that they were raising taxes. Judge Hudson gave weight to those denials, and to the final bill’s use of the word “penalty” to describe the fines, a change from earlier versions.
    Jack M. Balkin, a law professor at Yale who supports the act’s constitutionality, noted that “there are judges of different ideological views throughout the federal judiciary” and said that the health care plaintiffs had helped their cause by filing lawsuits in conservative venues.
    Judge Hudson seemed content with the knowledge that his opinion would be one of many. “The final word,” he wrote, “will undoubtedly reside with a higher court.”
     
  20. Rutashubanyuma

    Rutashubanyuma JF-Expert Member

    #20
    Dec 14, 2010
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    Law Will Proceed, Administration Says

    By ROBERT PEAR and REED ABELSON

    Published: December 13, 2010


    WASHINGTON — A court decision striking down a central provision of the new health care law will not disrupt efforts to carry it out, even though the ruling could increase confusion and embolden critics, Obama administration officials and employers said Monday.

    Enlarge This Image
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    Drew Angerer/The New York Times

    Robert Gibbs, the press secretary, answered questions about a federal judge's ruling.

    Multimedia

    [​IMG] Interactive Feature


    “Implementation of the act will proceed,” said a White House official after the federal court ruling on Monday. “The ruling will not materially impede our work.”
    The business of writing and enforcing regulations will continue, as will plans to expand Medicaid and create competitive markets known as insurance exchanges in each state, administration officials said.
    This week, 150 officials from more than 45 states will meet here with federal officials to map plans for creation of the exchanges, which will offer consumers detailed information about the costs and benefits of health plans available to them.
    The exchanges do not have to be in operation until 2014. Federal officials will assess states’ readiness in January 2013. It will be difficult to meet that deadline unless state legislators pass measures in sessions that begin next month.
    Even people who dislike the law said the court decision — striking down a requirement for most Americans to obtain health insurance, starting in 2014 — provided no reason for them to slow their preparations.
    “Until the Supreme Court makes a decision, I imagine that everyone involved in implementation, in government or the private sector, will go about their business as if the law will take full effect,” said James P. Gelfand, director of health policy at the U.S. Chamber of Commerce.
    “The lower court ruling does not provide the kind of certainty we need to base decisions on,” Mr. Gelfand added. “We will do what we have been doing: watch as regulations come out, and comply.”
    Marisa L. Milton, a vice president of the HR Policy Association, which represents executives in charge of human resources for large employers, said, “All our members are full speed ahead in trying to comply” with the law and meet its deadlines.
    Ms. Milton acknowledged that the ruling gave employers pause as they tried to figure out exactly what they must do to meet the law’s requirements. “It’s still a bit disconcerting,” Ms. Milton said. “It just adds to the uncertainty.”
    Insurance companies said the ruling, if upheld on appeal, could derail the entire law. The industry says the individual coverage requirement, or mandate, is essential if they are to carry out other provisions of the law that call for fundamental changes in the business of insurance. Those provisions require insurers to sell coverage to anyone who applies for it and prohibit them from denying coverage or charging higher premiums to people with pre-existing conditions.
    Helen Darling, the president of the National Business Group on Health, which represents more than 300 large employers, said she doubted that the law could be made to work if people were not required to buy health insurance.
    “There is no alternative,” Ms. Darling said. She predicted that, in the absence of a coverage requirement, the law would collapse as premiums rose to reflect the high cost of covering people who were less healthy than average.
    John T. Nielsen, an adviser to Gov. Gary R. Herbert of Utah, a Republican, said the court ruling would not have any effect on his state’s effort to set up an insurance exchange, a project on which he has been working for four years.
    “Our exchange was never predicated on the idea of an individual mandate,” Mr. Nielsen said. “An individual mandate is not absolutely essential for operation of an exchange.” Utah is one of 20 states that filed a lawsuit in Florida challenging the individual mandate and the required expansion of Medicaid.
    Many state officials, including governors and state legislators, are reluctantly making plans to comply with the federal law even as they denounce it. They gave two reasons for these seemingly contradictory actions. States can obtain hundreds of millions of dollars in federal grants under the law, and they want to overhaul their own insurance markets. Otherwise under the law, the federal government will do it for them.
    Many of the law’s consumer protections take effect next month. Health plans generally must allow adult children up to age 26 to stay on their parents’ policies and cannot charge co-payments for preventive services or impose a lifetime limit on benefits. Workers with flexible spending accounts face another, less welcome change, which will limit their ability to use such tax-favored accounts to pay for over-the-counter medicines.
    The ruling on Monday was issued by Judge Henry E. Hudson of the Federal District Court in Richmond, Va. Federal officials noted that Judge Hudson had not issued an injunction forbidding them to carry out the law, and that other judges had upheld the individual mandate.
    Accordingly, the officials said, they will plow ahead with plans to provide hundreds of billions of dollars in subsidies to low- and middle-income people to help them buy insurance, starting in 2014. And they will work with states to expand Medicaid to add about 16 million people to the rolls.
    “It’s our strongly held view that these provisions survive,” a White House official said.
    The Congressional Budget Office in June estimated that eliminating the requirement for people to obtain insurance would increase the number of uninsured even as it saved the government over $250 billion in the next decade.
    Much of the saving, about $113 billion, would result from lower enrollment in Medicaid, which would reduce federal spending below the levels expected under current law. In addition, the office said, without the individual mandate, fewer people would buy insurance through exchanges, and federal spending on subsidies would be $39 billion lower.
    At the same time, the office said, eliminating the individual mandate would increase the number of uninsured by 16 million, so that 39 million would be uninsured in 2019, rather than the 23 million previously projected.
     
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