Summary of Health Care Law by the Journal of Accountancy

The U.S. Supreme Court on Thursday declared the mandate in Sec. 5000A, requiring U.S. citizens and legal residents to maintain minimum essential health coverage, to be a permissible exercise of Congress’s taxing powers under the Constitution (National Federation of Independent Business v. Sebelius, Sup. Ct. Dkt. No. 11-393 (U.S. 6/28/12)).

The court, in a 5–4 decision, held that the payments required of individuals who do not maintain minimum health coverage under the “individual mandate” were not a penalty, but are a tax and are allowed under Congress’s power to tax in Article 1 of the Constitution. This means they are constitutional, even though a majority of the justices found that the individual mandate went beyond Congress’s powers under the Commerce Clause.