Here's What To Expect From The Supreme Court's Big Obamacare Ruling

Barack ObamaMichigan is this close.

Photo: AP

The entire country is waiting with bated breath for tomorrow’s Supreme Court ruling on President Barack Obama’s signature healthcare legislation, a decision that will have wide-ranging effects on politics and the markets, not to mention the multibillion dollar healthcare industry and the millions of people who aren’t insured.But the Supreme Court’s ruling will hardly be the end of Washington’s Obamacare battles. In fact, it is almost certain to be just a starting bell for yet another round in the protracted and rancorous debate over how best to reform the country’s broken healthcare systems. And it will likely set in motion an unpredictable string of political events that could have unforeseen ramifications on the 2012 elections.

Opinions vary widely about how the potential rulings could shake out politically and policy-wise. Here’s a look at some of the more likely fallout scenarios: 

The Supreme Court upholds all of Obamacare 
Legally, this outcome obviously benefits the Obama administration, vindicating the President for his most hard-fought legislative achievement. It would mean that the federal government could move forward with implementing the provisions of the law, most of which are scheduled to go into effect in 2014. It would also mean that Republican governors who have so far resisted complying with the law will have to start scrambling to set up state-run health insurance exchanges by 2014. 

But an outcome in favour of Obamacare could be the most politically complicated, refueling partisan rancor and putting even more pressure on Republicans in Congress to repeal the law. 

While it may seem counterintuitive, this scenario could actually be the best outcome for Republicans. Nothing has united Republican voters like their disdain for Obamacare, and a ruling in favour of the law would likely reignite the party’s conservative base for the 2012 election. 

The Supreme Court strikes down the individual mandate — but upholds the rest of the law 
While this outcome would be a superficial blow to the Obama administration, it actually wouldn’t change much in terms of the law itself. 

Insurance companies would be the real losers in this scenario. The individual mandate was basically a way to insure the majority of Americans while keeping premiums affordable. Without the mandate, companies will still be required to accept anyone, regardless of age and health conditions. In this scenario, premiums will likely skyrocket, with the expectation that people will wait until they’re sick to buy insurance. 

A ruling that strikes down only the individual mandate would likely send Congress back to the drawing board to figure out another way to cover the uninsured while keeping premiums low. 

But there is little political will to re-legislate this aspect of healthcare reform  before the 2012 election. The individual mandate is the least popular provision of the Obamacare law — by far — so any ruling that overturns the mandate will likely suck the political energy out of the healthcare issue. 

Republicans have indicated that they plan on sticking to their strategy of trying to repeal the whole law, but don’t have any plans to introduce legislation that would replace the Obama administration’s efforts in this session of Congress. Without some Republican support, it would be impossible for Democrats to pass anything to replace the individual mandate, and party leaders aren’t too keen on putting the Obamacare albatross back around their necks. 

The Supreme Court overturns the individual mandate and other parts of the law 
To prevent the problems caused by overturning just the individual mandate, it is possible that the court will also overturn the provisions of the Obamacare law that requires insurance companies to cover everyone and charge the same rates. 

This ruling would basically render the Obamacare law irrelevant, although it would save Obama the political shame of a full overturning of the law. It would also make it a lot easier for Republicans to repeal the rest of the law — or at least pretend to while keeping the more popular provisions of the law in place. 

The Supreme Court overturns all of Obamacare 
This would be a potentially devastating blow to Obama, killing the signature domestic legislation of his first term and opening him up to attacks from opponents who believe that he wasted three years on a failed law when he should have been focused on the economy. It would also be hugely demoralizing to Democrats, at least in the short term. 

Republicans are almost certain to bask in the victory, but are unlikely to introduce any legislation to replace the healthcare reform law, at least until after the 2012 election. 

The wild card in this scenario is the American public — while the individual mandate is widely reviled, other provisions of Obamacare are quite popular, and it is not clear how public opinion will change if those provisions are overturned as well. 

The Supreme Court punts the decision
There is an outside chance that the Supreme Court will delay making a decision until the individual mandate goes into effect in 2014. The justices could also rule on part of the case, and then send the other parts back down for decisions in lower court. 

The fallout from either scenario is totally unpredictable, although both cases are almost certain to add to uncertainty in the healthcare market 

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