The court could find the "individual mandate" unconstitutional but leave the rest of the law intactFor insurance companies nervously watching the legal fight over the constitutionality of the President’s health-care law, it would be the unthinkable: The U.S. Supreme Court strikes down the law’s so-called individual mandate, which requires millions of young, healthy people to buy coverage—but leaves intact rules compelling insurers to cover sick people, who are likely to cost far more in benefits than they pay in premiums. Congress is then left to fix the problem.
The scenario is a real possibility. In a challenge to the health-care law brought by 26 states, a federal appeals court took exactly that approach, declaring in August that the mandate is unconstitutional while saying the rest of the law could stand. The Supreme Court is expected to take up the question of the statute’s constitutionality next year. If the justices agree with the lower court and strip out the mandate, “that would be the worst of all worlds for insurers,” says Paul Heldman, a health policy analyst with Potomac Research Group in Washington. “You’ve got to have some way to ensure that healthy people are going to sign up for coverage to offset the cost of sicker people.”