(Ronnie Pitman: Flickr)

Over the last year as the myriad court cases about the federal health care law have made their way to the highest court in the land, California has spent that time moving ahead aggressively in implementing the Affordable Care Act (ACA). California was the first state to pass legislation to set up a health insurance exchange. The state also set up a new high risk pool so people with pre-existing conditions can get health insurance.

But what happens if the Supreme Court declares the individual mandate unconstitutional? Or overturns the entire law? What can still go forward in California?

The answer depends in part upon whom you ask. But for the most part California — like all states — will find it tough to move forward without the backing of the federal law.

Let’s start with today’s question — is the individual mandate constitutional? The purpose of the individual mandate is to get everyone into the health insurance pool, to spread risk. If the Supreme Court overturns the mandate, but leaves the rest of the ACA intact, the big question is: “Will the health insurance exchange go forward?” The exchange is a marketplace the state is establishing for individuals and small companies to buy health insurance. This market currently sports higher health insurance premiums because these groups don’t have the same purchasing power as large employers, for example. But without a mandate, there are numerous problems.

First, one of the ACA’s most popular provisions is its requirement that insurance companies can no longer disqualify people with pre-existing conditions. Bill Kramer is Executive Director for National Health Policy at the Pacific Business Group on Health, a coalition of large employers that is working to improve health care quality and reduce cost. He says if the mandate was overturned, “a fair number of people would choose not to get coverage, and you’d end up with the sickest people continuing to get coverage. It would be a high cost risk pool in individual markets.”

Indeed. In January the UCLA Center for Health Policy Research released a study [PDF] that estimated one million fewer Californians would obtain insurance without the individual mandate.

Diana Dooley is California’s Secretary of Health and Human Services Agency and also serves on the exchange board. She said whether the exchange could operate if the mandate were struck down is a “question that cannot be answered.” Still, she sounded cautiously optimistic in an interview. She pointed out that if the rest of the ACA is upheld, the law includes subsidies to help people purchase insurance. “If there are subsidies,” she told me, “if there is a way to make health insurance more affordable for the uninsured and spread the cost more fairly … we could still have a robust exchange.” But that’s a big “if.” It’s unclear if the federal government would be able to provide subsidies if the individual mandate is overturned.

But one other popular part of the ACA already enacted which would still go forward is children staying on their parents’ health plan until age 26. Pre-existing conditions exclusions for children have already been done away with and, presumably, would also go forward.

With one exception, every county in California has enacted a “Low Income Health Program” (LIHP). This “Bridge to Reform” is intended to help the poor who are not eligible for Medi-Cal obtain coverage until 2014 when the ACA goes into effect. At that point, they will be eligible for Medi-Cal coverage through an expansion legislated by the ACA. The Supreme Court hears oral arguments on the expansion tomorrow, which brings us to…

What if the Supreme Court strikes down the entire law?

Again, Dooley sounded a bit more optimistic on this front, even though the federal subsidies would go away. “If we don’t have the additional federal funding and the law of the Affordable Care Act, I think it will be a few years before California can get its feet underneath it to go it alone.” She believes California would ultimately pass its own individual mandate, something attempted in 2007 during under former Governor Arnold Schwarzenegger that ultimately lost by a few votes in the state senate.

But Bill Kramer pointed out that all the pieces of the ACA already put into place in California are all intertwined. “The reality is given the state’s fiscal condition,” he says, “it’s very difficult to put together all the pieces at the state level.” In addition, while the federal government can run a budget deficit, California cannot. Kramer points out that the Congressional Budget Office found the ACA to be “budget neutral” over ten years, but individual years will run deficits. Most states do not have the luxury of spreading spending for a major program over ten years.

Meanwhile, tomorrow is the last day of oral arguments before the Supreme Court. The Court’s decisions are expected in late June.

Chief Justice John Roberts is emerging as a potential swing vote regarding the individual mandate. (Courtesy: U.S. Supreme Court)

Sharp questioning by the Supreme Court’s conservative justices has cast serious doubt on the survival of the individual insurance requirement at the heart of President Barack Obama’s historic health care overhaul.

Arguments at the high court Tuesday focused on whether the insurance requirement “is a step beyond what our cases allow,” in the words of Justice Anthony Kennedy.

He and Chief Justice John Roberts are emerging as the seemingly pivotal votes.

Justices Antonin Scalia and Samuel Alito appeared likely to join with Justice Clarence Thomas to vote to strike down the key provision. The four Democratic appointees seemed ready to vote to uphold it.

The individual mandate requires those not covered by employer-based health insurance, Medicare or Medicaid to purchase coverage, with the help of government subsidies if they meet a certain income threshold.

NPR’s “Shots” blog also reports that the individual mandate appears to be in trouble.

Those challenging the law say the federal government is going way too far with the mandate. This, they say, is the first time the government is making people buy a commercial product they may not want. That’s a huge overreach, they contend.

Just take a look at the very start of the brief filed by Paul Clement, the legal wunderkind who is leading the challenge by 26 states to the overhaul law:

“The individual mandate rests on a claim of federal power that is both unprecedented and unbounded: the power to compel individuals to engage in commerce in order more effectively to regulate commerce. This asserted power does not exist.”

After Clement finished his arguments along those lines, SCOTUSblog’s Tom Goldstein left the courtroom to file an update saying, “The individual mandate is in trouble — significant trouble. It’s too early to tell whether it will be struck down.”

Still, it’s clear that the court’s conservative justices are “quite skeptical.” And Goldstein said, “Paul Clement gave the best argument of any kind that I’ve ever heard.”

Bruce Bodaken is CEO of Blue Shield of California. (Photo: Cindy Charles)

To those who haven’t followed the health care debate closely until now, you might be surprised by one of California’s leading proponents of universal coverage. It’s Bruce Bodaken, CEO of Blue Shield of California, one of California’s largest health insurance companies. He first proposed a system of universal coverage for Californians ten years ago.

“At that time, there was 20 percent of Californians without coverage,” he said in an interview with KQED. “We looked at that in one of the richest societies in the world and said, ‘Simply unacceptable for people not to have at least basic health care.’ So we proposed that all people in California have at least basic coverage. Those that can’t afford it would be subsidized and all groups and individuals would be mandated to be covered.”

It sounds a lot like the Affordable Care Act (ACA) being considered by the Supreme Court this week. Tomorrow, the Court will hear oral arguments about the constitutionality of the individual mandate — the requirement that all Americans have health insurance. Those opposed say that Congress has exceeded its authority in requiring Americans to purchase a product.

Bodaken doesn’t see it that way. “I’m no lawyer and the Court will decide whatever they decide,” he says. “But I do know this — we mandate many things in this society. … I have to send my children to school, at least to a certain age. If you want to drive a car, you have to have auto insurance. I don’t think this is all that different.”

Tuesday, lawyers arguing in favor of the individual mandate are expected to make what — at first glance — looks like an odd request. They will ask the Court that if Justices decide to strike down the individual mandate, that they also strike down a very popular provision of the ACA, the “guaranteed issue” provision. You might know it as the requirement that insurers accept everyone, regardless of pre-existing medical conditions. Bodaken understands why the Obama Administration would ask the Court to strike down guaranteed issue if it declares the individual mandate unconstitutional.

“If we don’t have everyone in, those that need care and those that don’t need care,” Bodaken says. “There are not enough premium dollars going into the pool to make it affordable for everyone.” Bodaken went on to give a hypothetical example: he’s a runner and asked what could happen if he needed a knee replacement. If there were no mandate to be insured, he could remain uninsured until the last minute.

“Then I would go in, have coverage for a couple months, have surgery that might cost $30-50,000, and then drop coverage. Obviously, that doesn’t work.”

Blue Shield of California, like other health insurers, has come under fire for rising premiums. Bodaken could not precisely predict prices, because the exact benefits under the ACA have not yet been set. But he does anticipate more affordable coverage if everyone in California has health insurance. “The increases over the last few years to a great extent is that the market has gotten smaller with the recession. … Only the people that are the sickest stay in and everyone else drops off.”

In some ways, is it such a surprise that a health insurance executive would support a government mandate that would bring his company more customers?  ”Our concern was not whether or not we would get additional enrollees,” Bodaken countered. “We will get our fair share and that’s great. What’s really important — whether Blue Shield gets one more enrollee or none — is that people in California, indeed in the United States, have access to good care, at least in terms of the basics of health care.”

Libertarian Paul Ruffino, 55, has been looking for an insurance plan since leaving his previous job. Several insurance companies refuse to cover him because he has pre-existing conditions. (Photo: Sarah Varney)

Today marks the second anniversary of the federal health care law, and, unless you’ve been depriving yourself of news for the last several weeks, that same law will be front and center before the Supreme Court starting Monday. Here in California, uninsured Californians have a particular stake in the Court’s actions.

Madera County is a largely conservative and agricultural area where one in every three people lacks coverage. While many people say they want the Supreme Court to throw out the federal health law, I found that many there are struggling to reconcile their political views with the basic need for health insurance.

I started off in Oakhurst. Here, just a few miles from the entrance to Yosemite National Park, is the Sweetwater Steakhouse, a local watering hole where no one is shy about their opinions of President Obama’s signature initiative, including people like Joe Stern. ”ObamaCare is absolutely horrible, horrible, horrible. It should struck down immediately.”

Stern sips on a glass of pinot noir. He’s 66 years old, a registered Republican and owns a small water conditioning company. He is covered by Medicare, and he says he’s thankful for the program. Before he turned 65, Stern paid mightily for his health insurance.

“I, a single person, was paying $670 a month,” he told me. “I thought it was pretty brutal but I was still against ObamaCare by far, ‘cause I saw how they did it in the middle of the night. It was just totally, it’s not how you do a radical change like that. You do it slowly.”

If at all. Like many conservative voters I interviewed in Madera County, Stern despises the individual mandate included in the law, the requirement that all Americans have health coverage.

There is a lot of suspicion here about whether the health insurance system is really all that broken. Stern thinks many people choose to be uninsured, and in a sentiment I heard from nearly everyone I interviewed, Stern says no one is denied medical care.

“I don’t know of anyone that was left on the street to bleed to death,” he says. “I don’t know anyone that is really left out.”

I asked Stern if he knew anyone at the bar who is uninsured. He turned cheerfully to his friend Mary Westover sitting next to him. Westover was coy about her age. She’s maybe 50-ish. She’s a registered Republican and self-employed artist and businesswoman. She’s been uninsured for 17 years.

“When I was married I had insurance through my husband. Since we got divorced, I was self employed. I just couldn’t afford it. I couldn’t afford the premiums. I was flying by the seat of my pants every inch of the way,” Westover said.

It’s been nearly two decades since Westover has had a pap smear or a mammogram. She says she just tries to take care of herself. She’s opposed to the individual mandate but says she wasn’t aware the federal government would give subsidies to people like her to buy a policy.

“If it were subsidized, if it were made, you know, manageable, I would want that,” Westover told me. “And I don’t know how people who can afford it, can sit there and say that we shouldn’t have that. Because there are a lot more of us, than them.”

The ranks of the uninsured in Oakhurst, like everywhere else in California, are indeed growing. Employers continue to shed health insurance benefits or pass on rising health care costs to their employees.

Doug Macaulay, a Republican, has sold insurance to the residents of Oakhurst for nearly three decades, and, in that role, has heard just about everyone’s opinion of the federal health law.

“I think there’s just a certain lack of knowledge of how health care works,” he said.

Macaulay says people get mad at the insurance companies, but they don’t see ‘ObamaCare’, as they derisively call it, as the answer.

“I get this all the time,” Macaulay says, “where there’s not really a connection between, ‘Ok, here’s what the government is trying to do for you. You’re complaining over here that you don’t have health insurance and you can’t buy it. And over here they’re trying to provide you with it but that’s the worst thing… ever.’ So there seems to be a disconnect in the thinking there because it gets in the way of what I want to think about my government.

Down the road from Doug Macaulay’s office, meanwhile, Paul Ruffino is preparing to welcome guests to Chateau du Sureau, a five-star, luxury inn that looks over the mountains of Yosemite.

Inside, there’s a fire burning in the grand salon and painted frescoes on the ceiling. Ruffino, the inn’s manager, is 55 years old. He’s a Libertarian. He finds the Republican party too liberal.

“I’m uninsured! It’s the first time in my life and it’s probably when I need it the most,” he said.

Ruffino says the plans he’s looked at are expensive and won’t cover his pre-existing conditions. Still, he says it was his decision to leave a previous job in Southern California that came with insurance and move to Oakhurst.

“Do I make the government responsible for my choices,” he asked rhetorically. “I made the choice. I knew beforehand. I knew beforehand what was going on.”

Ruffino seems torn between his unsparing self-reliance and a sense that the insurance industry is unfair. ”Would I like it to be better? There’s a greedy part of me that says that it would.”

He thinks the insurance companies should NOT be allowed to pick out only the healthy and leave guys like him behind.

“And that’s where I have to then ask: Does there come a time when government has to get involved and at what levels? But when you are distrustful of the system in whole it makes it difficult. I go back and forth. I ping pong on this issue all the time.

These conflicts – both personal and political – will be amplified next week when the Supreme Court considers just what role the government should play in re-making the country’s health insurance system.

Listen to the story:

(Courtesy: U.S. Supreme Court)

Next Monday, the Supreme Court begins considering the Constitutionality of the Affordable Care Act, or ACA. Three days, six hours of oral arguments. But it’s not just one long slog about health care reform. The Supreme Court is considering four different questions over those three days.

Legal scholars, pundits and those suitably opinionated have been pontificating about all kinds of legal issues. But the average American might want to know, in straightforward language, what those Four Questions actually mean.

Here’s my take on them:

1. Can the Supreme Court Consider the ACA Now, Anyway?
Oral arguments Monday, March 26, 7-8:30am PT

This is a question only lawyers can love. Feel free to skip to Question #2 if you like. If you’re still with me, start by going 140 years back in time to the 1867 Tax Anti-Junction Act. No, I’m not making this up–it’s the crux of this first question before the Supreme Court. Here’s the deal: the ACA requires that people purchase health insurance or pay a penalty. Many people say this “penalty” is a tax in disguise. The Tax Anti-Injunction Act bars people from suing over a tax until they actually pay the tax. Since the ACA goes into full effect in 2014, no penalties will be paid until 2015. And so, 2015 would be the soonest someone who paid the tax could challenge the constitutionality of the ACA. Will the Supreme Court punt and say, “Come back in 2015″?  Court-watchers say that’s unlikely. SPECIAL NOTE: If you can only pay attention to two of the three days of hearings, this is your day to skip.

Update: The Supreme Court determined it had the authority to rule.

2. Is the Individual Mandate Constitutional?
Oral arguments Tuesday, March 27, 7-9am PT

Of the four questions the Supreme Court is considering, this is the big one. As you learned in Question #1, the ACA requires all Americans to purchase health insurance or pay a penalty/tax. If your annual income is below a certain level–about $92,000 for a family of four– the government will provide subsidies or tax credits to help you. But the mandate is unpopular. Just over half of Americans think the Supreme Court should declare the mandate unconstitutional, while 28 percent think it should stay. The primary legal question is this: does Congress have the authority under the Commerce Clause of the U.S. Constitution to require Americans to purchase a product, in this case health insurance? Those in favor say yes–Congress can both regulate interstate commerce and legislate taxes. Those opposed say this is the first time Congress has required Americans to purchase a product and it’s unconstitutional. SPECIAL NOTE: if your employer provides health insurance or if you are a Medicare recipient, nothing about your personal situation will change. On January 1, 2014, you would continue to receive the same employer-based coverage or Medicare.

Update: In a 5-4 ruling, the Supreme Court determined that the individual mandate is constitutional.

3. If the Individual Mandate is Unconstitutional, Can the Rest of the ACA Go Forward?
Oral arguments Wednesday, March 28, 7-8:30am PT

Severability. This word will be all over the news next Wednesday. Why? Suppose the Supreme Court decides the individual mandate is unconstitutional. Can the mandate be “severed” from the ACA, allowing the ACA to stand? This question has a bit of unusual background: normally when Congress writes a law, it includes a “severability” clause, so that if one part of a law is struck down, the rest of the law can still stand. Back in the last days of drafting the ACA, the House version indeed had a severability clause. The Senate side expected to add it in a conference committee. But things got so hectic at the end, there was never a conference committee and the severability clause was not part of the final law. SPECIAL NOTE: many experts think severability is implied. They say if the individual mandate is struck down, the rest of the law can stand. Only the Supreme Court will say for sure.

Update: The question of “severability” became irrelevant since the Supreme Court determined that the individual mandate is constitutional. 

4. Is the Medicaid Expansion Constitutional?
Oral arguments Wednesday, March 28, 10-11am PT

Medicaid is the health care plan for the poor and disabled that is run by individual states with both state and federal dollars. The Affordable Care Act expands those eligible for Medicaid to adults earning 133 percent of the federal poverty level. But in order for states to continue receiving any federal money for Medicaid, the ACA requires them to comply with this expansion. Twenty-six states who have challenged this requirement say withholding all monies for Medicaid is coercive and therefore unconstitutional. Those states which support the expansion–including California–say that Congress can constitutionally attach such conditions under what’s known as the “Spending Clause.” SPECIAL NOTE: Congress has expanded Medicaid many times in the past and never had an expansion struck down.

Update: The Supreme Court ruled 5-4 that Congress may not take away all funds for Medicaid if a state decides not to expand the program. As of January 2013, many states have determined to go forward with the expansion; the federal government will pay 100 percent of the costs of any newly eligible enrollees for the first three years and not less than 90 percent of the cost thereafter. Other states have said they will not expand the program; Congress must continue to fund a state’s existing Medicaid program at the existing level.

Some final thoughts:

The Supreme Court’s decisions are expected in late June, possibly early July.
Update: as noted, the decisions came down June 28, 2012.

The Court will make audio recordings available following the end of arguments each day, but turned down requests for live TV or radio broadcasts.
Update: Oral arguments and transcripts on the Medicaid expansion and individual mandate. 

While some elements of the Affordable Care Act have already gone into effect, the major components of the legislation take effect on January 1, 2014.

Learn More:

Background on the Individual Mandate: Court Weighs Making Health Coverage a Fact of Life (AP)

A Guide to the Supreme Court’s Review of the 2010 Health Care Reform Law [PDF]  (Kaiser Family Foundation)

And for you wonks out there, you can find content galore here:
The Supreme Court Decides: Health Care at the High Court (Kaiser Health News)