By Theresa Seiger - email
WASHINGTON (RNN) - The U.S. Supreme Court heard the first of three days of testimony on the landmark healthcare law, passed under the Obama Administration in 2010, that has deeply divided the country.
At the center of the debate is whether the healthcare mandate and the tax penalty associated with it are constitutional. On Monday, the Departments of Health and Human Services, Treasury and Labor faced off with 26 states in the highest court in the nation to settle the matter.
In order to enforce the government's mandate, a person who does not have the minimum amount of health insurance is subject to a tax penalty for each month he or she and his or her dependants are uninsured.
A number of people are exempt from the penalty, including members of Native American tribes and those who would have to spend more than 8 percent of their income to meet the provision.
Detractors say the mandate is outside of Congress's constitutional power. On Monday, attorney Gregory G. Katsas argued that states would be hurt by the requirement, which would bring millions of poor Americans under Medicaid.
However, the justices seemed to shy away from this argument.
"That does seem odd, to suggest that the state is being injured because people who could show up tomorrow with or without this law will show up in greater numbers," said Justice Elena Kagen. "I mean, presumably the state wants to cover people whom it has declared eligible for this benefit."
According to Katsas, those who are eligible but who do not enroll in Medicaid cost $500 to $600 million a year in Florida alone.
The justices also seemed to support the need for a tax penalty as a way of enforcing the mandatory minimum health coverage.
"Why would you have a requirement that is completely toothless?" Chief Justice John G. Roberts said. "You know, buy insurance or else. Or else what? Or else nothing."
Supporters argue that the provision is part of a larger plan of economic reform and little more than a tax, bringing it within Congress's power.
As the provision functions as a tax, there are no criminal ramifications for not maintaining health insurance.
The Court, however, questioned the fact that those who didn't make enough money to be taxed under the provision would have no incentive to join Medicaid, save for the convenience of it.
The Justices also heard argument over whether the tax falls under the Anti-Injunction Act. If the case meets the requirements for the Act, the court would not be able to touch the penalty provisions until after someone has been "harmed" by it.
People lined up for hours outside the Supreme Court in hopes of grabbing one of the few seats available for the public.
Reactions to the Affordable Care Act (ACA) have been divided, mostly along party lines. Republicans in Congress have continually highlighted their goal of repealing the ACA.
According to a brief for the case, the uninsured used $116 billion worth of health care services while only paying for $73 billion. The excess costs are shifted onto the premiums of people with health care.
The case will be argued over two days, while related bills focused on whether the ACA can survive without the mandatory insurance clause are scheduled for Wednesday.
The Supreme Court is expected to issue its ruling in June.
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