For Immediate Release - January 13, 2012

AG Coakley Files Brief with U.S. Supreme Court Supporting Federal Basis for Passing National Health Care Reform

Maintains that Benefits of Massachusetts Health Care Reform Show Value of Reducing Number of Uninsured on National Level

BOSTON – Arguing that Massachusetts’ own experience supports the federal government’s basis for passing national health care reform, Attorney General Martha Coakley filed a brief today in the U.S. Supreme Court supporting the federal Patient Protection and Affordable Care Act (PPACA). pdf format of 2012-01-13-health-care-amicus.pdf

Massachusetts’ health care reform law served as a blueprint for the PPACA. In her brief, the Attorney General argues that the successful results from the Massachusetts law enacted in 2006, including a reduction of the number of uninsured people utilizing the “free-care” pool (so-called “free riders”), demonstrate that Congress had a rational and constitutional basis to enact an individual coverage requirement in PPACA.

“Since implementing health care reform, Massachusetts has seen many tangible benefits,” said Attorney General Coakley. “Over 98% of Massachusetts citizens are insured and the amount of so-called ‘free care’ has dropped by hundreds of millions of dollars.  The benefits of health care reform in Massachusetts – passed with bi-partisan support –are a clear basis for which Congress chose to address the health care crisis on a national level.”

Under PPACA, the federal health care reform legislation that was approved by Congress in 2010, those who can afford it are required to maintain a minimum level of health insurance or pay a tax penalty for failing to do so.  In United States Department of Health and Human Services, et al. v. State of Florida, et al., a federal court in Florida ruled that Congress did not have the power under the Constitution to implement this minimum essential coverage provision. The Florida court concluded that the failure to buy health insurance is not economic activity subject to Congressional regulation.  After a federal appeals court affirmed the Florida court’s ruling, the Supreme Court agreed to hear the case.

The federal minimum essential coverage provision at issue in this case is modeled on a similar provision in Massachusetts law, which requires most Massachusetts residents to obtain health insurance.  Based on Massachusetts’ experience, AG Coakley argues that preventing healthy people from foregoing health insurance until they are sick or injured (a practice referred to as “free-riding”), generates substantial economic benefits.

According to the Attorney General’s brief, Massachusetts’ experience with health care reform demonstrates that Congress had a rational basis for concluding that free-riding by individuals, taken in the aggregate, has a substantial effect upon commerce, and that reducing or eliminating free-riding will benefit the health insurance market as a whole.

Among the tangible benefits of health care reform in Massachusetts cited in the Attorney General’s brief include:

  • An increase in the number of insured residents to more than 98% of the state’s population in 2010, up from 87.5% in 2006, giving Massachusetts the lowest rate of uninsured residents in the country;
  • The gains in Massachusetts residents with health insurance spurred a corresponding sharp decline in the amount of state spending on “free care” for the uninsured and underinsured. The costs of free care dropped from $709.5 million in fiscal year 2006 to $475 million in fiscal year 2010.

The Attorney General’s brief also points out that since enacting health care reform, the rate of health insurance premium growth has slowed in Massachusetts.  As of 2010, health insurance premiums in Massachusetts compare favorably to the national average and are less expensive than in a number of other states.  

Moreover, the Attorney General argues that despite Massachusetts’s intrastate success in improving access to quality health care and reducing spending on “free care,” national health care reform, such as that embodied in the PPACA, is required to grapple with interstate (and international) health care trends that individual states – acting alone – have little power to influence.

Assistant Attorneys General Daniel Hammond, Emiliano Mazlen, Thomas O’Brien, and Sarah Ragland, and Policy Analyst Merritt Dattel McGowan, assisted in the drafting of the AG’s Brief.