Setting aside questions of law, the Supreme Court’s decision Thursday is a victory for the economics of (nearly) universal health care. Without the mandate to buy insurance, the Patient Protection and Affordable Care Act would have been on shaky ground. As the government argued, if people were not required to buy insurance, healthy people would opt out and only the sick would buy insurance. That would have produced a “death spiral” in which rates would go up to cover the sick, forcing more and more healthy people out of the pool. So the Supreme Court’s 5-4 vote to uphold that mandate is a big deal.
In December 2010, I argued in an Opening Remarks column that the individual mandate would not, as a federal judge in Virginia claimed, “invite unbridled exercise of police powers.” I wrote that “if the Roberts Court seizes on this case to lay down a sweeping precedent limiting congressional power, it will be a blow not only to universal health care but also to a wide range of other government initiatives.”
Most constitutional scholars felt the Affordable Care Act was on pretty safe ground. But after the skeptical questioning of the government’s lawyers at the oral arguments in March, it became clear that the mandate really might bite the dust. What then? I wrote an article for the magazine saying that a death spiral wasn’t guaranteed. The online headline was “Obama Health-Care Plan Can Live Even If Insurance Mandate Dies.” But the truth is, the Affordable Care Act will be much easier to swing with the mandate upheld than without it.