US judges vote to keep Obamacare
pharmafile | June 28, 2012 | News story | Sales and Marketing | Health reform, President Obama, US
The US Supreme Court will allow President Obama’s health reforms to stand.
The nine-member Supreme Court has decided not to repeal the Affordable Care Act, which means Obama’s radical health reforms will remain. It was a tight run thing, however, with the the judges split 5-4 in favour of keeping the Act.
The Affordable Care Act was passed in 2010 with the full measures set to come into place in 2014, and requires all Americans to obtain health insurance, or face a penalty fine.
But opponents of President Obama – made up mainly of Republicans – say that this amounts to a mandate, which is illegal under the terms of the US constitution.
Its opponents had hoped that the judges would repeal the Act today, but they have been defeated after the Supreme Court judges decided to uphold the law, and the use of a mandate.
In addition to the mandate, the Supreme Court was asked to consider another part of the law that deals with the expansion of Medicaid, a programme for poor citizens.
The court ruled to limit that provision, but did not strike it down altogether.
The Court said in its ruling: “Nothing in our opinion precludes Congress from offering funds under the ACA to expand the availability of health care, and requiring that states accepting such funds comply with the conditions on their use.
“What Congress is not free to do is to penalise States that choose not to participate in that new program by taking away their existing Medicaid funding.”
Obama will be sighing with relief, as this has been the biggest domestic success of his first term in office. It will also give him greater confidence ahead on the US elections in five months’ time, as a defeat in the Supreme Court would have weakened him politically.
The Act will extend insurance to 32 million Americans who currently have no coverage and seeks to address the fast-increasing costs of healthcare to the nation.
Among its measures is a reform which ends the situation where some patients are having to pay prescription costs directly, the so-called ‘doughnut hole’.
The reforms are estimated to cost $940 billion over by 2020, and are expected to reduce the US fiscal deficit by $143 billion.
The pharma industry agreed in 2009 that it would contribute to cost reductions by guaranteeing savings of $80 billion over the next decade, in part by offering rebates and making brand-name drugs more affordable for senior citizens affected by the doughnut hole problem.
The pharma industry supported the Act when it passed, and the US lobby group PhRMA spent $100 million on advertising for the reforms.
In return, President Obama agreed to drop two policies vehemently opposed by industry – the parallel importation of drugs from Canada and giving the federal government the power to negotiate Medicare prices directly with pharma companies.
But public opinion has been more divided on the issue, with many worried about its high cost and impact on the economy.
But this will not be the end of the debate as the Democrats may have won the battle, but the war is still ongoing.
The Republican Party has already vowed to repeal the Act if it wins the US election in November, meaning the Act will continue to play a pivotal role in American politics.
Ben Adams
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