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Supreme Court gives Obamacare clean bill of health

The US Supreme Court has delivered President Barack Obama a significant election year victory, backing the legality of his controversial health care reforms. In a narrow five votes to four judgement, the Supreme Court rejected arguments that so-called individual mandate provisions in the Patient Protection and Affordable Care Act, which require people to take out a minimum level of health insurance, were unconstitutional.

01 Jul 2012

The US Supreme Court has delivered President Barack Obama a significant election year victory, backing the legality of his controversial health care reforms.

In a narrow five votes to four judgement, the Supreme Court rejected arguments that so-called individual mandate provisions in the Patient Protection and Affordable Care Act, which require people to take out a minimum level of health insurance, were unconstitutional.

Chief Justice, John Roberts, said the Act's requirement that certain individuals pay a financial penalty if they do not obtain health insurance could reasonably be characterised as a tax.
He said that because such a tax was permitted by the Constitution, it was not the Court's role to forbid it or consider its wisdom or fairness.

The judgement is an important victory for Mr Obama, who was facing the prospect of campaigning for re-election robbed of the single most important achievement of his first term if the Supreme Court had knocked the Act back.

The US President said that, with their vote, the Supreme Court justices had “reaffirmed a fundamental principle - that here in America, in the wealthiest nation on Earth, no illness or accident should lead to any family's financial ruin whatever the politics”.

“Today's decision was a victory for people all over this country whose lives will be more secure because of this law and the Supreme Court's decision to uphold it.”
But approval of Obamacare brings with it a sting in the tail for the Government’s finances.

US Government figures show the rate of health spending growth slowed in 2010, reaching $US2.6 trillion, a 3.9 per cent rise from the previous year.

But Government officials expect that, while growth will remain modest through to the end of next year, it will surge in 2014 when Obamacare reforms come into effect, predicting annual growth to spike up to 7.4 per cent.

Under their projections, health spending will increase sharply during the decade, reaching a massive $US4.8 trillion in 2021 – equivalent to almost 20 per cent of gross domestic product – with the Government stumping up almost half of the bill.

 

AR


Published: 01 Jul 2012