Dr. Coday's comments on Supreme Court Healthcare Decision

June 28, 2012

Bold New Leadership is Needed for Meaningful Healthcare Reform in the Wake of today's Supreme Court Decision

Today's ruling by the Supreme Court of the United States on the Patient Protection and Affordable Care Act leaves the individual mandate intact but prevents the United States Government from withdrawing all federal Medicaid funding from states that do not agree to expansion of their Medicaid Program. Medicaid, created in 1965, is a healthcare program for the poor that is funded by a combination of the federal and state governments.

The individual mandate requires nonexempt individuals who are not covered under an employer or government sponsored health insurance policy to purchase an insurance policy meeting certain minimum standards from a private insurance company. Failure to do so will result in a federal tax penalty to the individual.

Chief Justice Roberts concluded that the individual mandate is not a valid exercise of congressional power with respect to the Commerce Clause and the Necessary and Proper Clause. However, he concluded that the requirement to purchase health insurance is effectively a form of taxation, and the Congress does have explicit constitutional power to "lay and collect Taxes (Art. I, §8, cl. 1)." Therefore, the mandate was upheld by the court.

The Patient Protection And Affordable Care Act Will Not Help The Poor

The Patient Protection and Affordable Care Act will not be effective in helping America's poor. Paradoxically, it might make care even more difficult for the poor to obtain. It could also worsen the overall economic status of America's poor.

The Act, commonly called "Obama Care," makes an effort to help America's poor obtain greater access to healthcare. It does this primarily by expanding Medicaid, created in 1965 to provide healthcare to the poor. This program is funded by a combination of federal and state money, and at this time all 50 states participate. The federal government establishes guidelines for Medicaid, and each state administers the program. In Washington State, the Department of Social and Health Services ("DSHS") administers Medicaid.

In order to provide healthcare insurance to more Americans, the Act increased the qualifying income level for enrollment in Medicaid to 133% of the federal poverty level. Thus, participants do not need to be as poor as before in order to be eligible. As a result, enrollment is expected to mushroom. King County (Washington) has estimated several tens of thousands of new enrollees by 2014, and I have heard estimates for Washington State of hundreds of thousands of new enrollees.

Allowing more Americans to enroll in Medicaid sounds like it will benefit America's poor. But there is more to the story.

Specifically, Medicaid has been gradually failing for years. The root problems are relative under funding, a need to revise federal guidelines to refocus the program, and a need for the states to improve program administration. These chronic problems have resulted in Medicaid failing to properly address the basic healthcare needs of many patients. For example, as a Medicaid-participating doctor, I have seen numerous Medicaid patients unable to get dental care, proper treatment for mental health disorders, and substance abuse treatment due to lack of coverage or a lack of participating providers. Worse, reimbursement rates that are well below the cost of business combined with a very high bureaucratic burden for providers have driven many doctors out of Medicaid. As a result, many Medicaid patients are finding it increasingly difficult to obtain care. They have coverage, but no doctor.

By flooding Medicaid with new patients and not fixing the underlying problems, we should expect the already failing program to succumb. Given the fiscal challenges of the federal government and the states, there will not be enough money available to revive Medicaid if its enrollment significantly expands, even if we get new leadership in the Congress, the White House, and the 50 states that will properly refocus and run the program.

If Medicaid collapses, it is the very poorest Americans who will get hurt the worst. They will be worse off than before the Act was passed.

Compounding the problem, private health insurance costs have risen since passage of the Act. Most distressing, the "individual mandate," which forces some businesses to purchase expensive health insurance for employees or face tax penalties, has been a job killer. High unemployment continues with no end in sight, and this hurts the poor.

The Supreme Court of the Untied States is poised to rule on the constitutionality of the "individual mandate" with respect to the Commerce Clause. If the court rules against the mandate, and does not sever it from the rest of the Act, then the whole Act will be struck down. I think the Act is unconstitutional, and striking it down would be just what this doctor would like to order.

With the Act abolished, we can begin the real work of rebuilding Medicaid and the economy, which is exactly what the poor need.

Arthur Coday, Jr., M.D.

2012 Republican candidate for the U.S. Senate in Washington State.