WASHINGTON - The doctors and nurses in the emergency room of Holy Family Hospital in Methuen routinely treat patients who lack health insurance.
How can this be, given that Massachusetts requires its residents to obtain insurance and has achieved near-universal coverage since its landmark health-care law passed in 2006? Simple: many of the uninsured showing up at Holy Family hail from across the state border, a mere three miles away in New Hampshire, which has no such mandate.
The situation facing Holy Family is at the crux of the profound and historic constitutional question the US Supreme Court will begin considering Monday.
Is Congress exceeding its constitutional authority and trampling on individual rights, as attorneys for the 26 states suing the federal government argue, by imposing a federal mandate that says those living in New Hampshire and all other states must buy insurance, too? Or is it merely exercising its powers under the Constitution’s “interstate commerce’’ clause, which permits Congress to intervene in cross-border commercial activity, since health-care markets do not observe state lines?
Because it became the first state to impose an “individual mandate’’ that requires most residents to obtain health insurance - and because its law served as a model for President Obama’s 2010 national health-care overhaul - the Bay State invariably is held up as an example in the intense battle that is expected to be settled by the nation’s highest court in June.
The court’s decision will determine the future of regional health-care markets like New England’s, and Massachusetts will find out if it is on the cutting edge of national change or if it will remain a single square in a patchwork of disparate state health care laws.
Nationally, nearly 50 million people lack insurance, a problem Democrats and many Republicans have argued is too great for state-by-state solutions, while critics of the Obama law say states should be left to find their own way.
“No state can be a health care island,’’ said Wendy Parmet, a Northeastern University law professor who has filed a brief on behalf of Health Care For All, the Massachusetts Hospital Association and other Bay State supporters of the federal law. “Massachusetts has gone much further than other states have in attempting to achieve universal coverage, but it runs up against some barriers because of the interstate nature of the health care system.’’
Uninsured New Hampshire residents using the emergency room account for 11 percent of the hospital’s bad debt each year, said Lester Schindel, president of Holy Family.
“When a hospital is located near a state that doesn’t require insurance, it creates an added burden for us,’’ Schindel said. “We don’t have the margin, or the financial ability, to be able to absorb this in the long term.’’
In a year following the Massachusetts reform, Bay State emergency rooms treated more than 12,900 uninsured patients from other states, despite being located in New England, which has a relatively low rate of uninsured people compared to other parts of the nation.
States in other regions - namely the South and Southwest - would fare even worse if they tried to replicate Massachusetts’ universal coverage model but neighboring states did not. While 11 percent of New Hampshire residents are uninsured - compared to fewer than 2 percent in Massachusetts - a quarter of Texans lack insurance.
Indeed, the government argues - and the Holy Family Hospital example shows - that those without health insurance actively participate in the health-care market but pay only a fraction of the costs of the services they consume. Proponents of the individual mandate say it would ease the amount of uncompensated medical costs that result in higher premiums for the insured.
But opponents of the unpopular law contend that the individual mandate is unconstitutional because Congress does not have the power to compel individuals to enter into commerce. Some economists accuse the government of forcing young, healthy individuals who made the rational economic decision to forgo insurance to buy insurance at disadvantageous prices to subsidize the cost of the law’s requirements.
Furthermore, they say, different states have different needs and a one-size-fits-all federal mandate will not solve what are complex problems.
“Texas and Massachusetts are not similar patients ailing from the same disease, and it would be policy malpractice to treat them as if they were,’’ said Joshua Archambault, director of health care policy at the Pioneer Institute of Public Policy Research in Boston, who signed onto a brief written by economists opposing the law.
While some Americans have already started to benefit from the law, most of its provisions - including the individual mandate - do not go into effect until 2014. There is a chance that the court will postpone hearing the case until 2015 if it decides on Monday that the law’s financial penalty for those who do not purchase health insurance amounts to a tax. The court will also consider this week whether Congress’ threat to withhold federal funding for Medicaid if states don’t comply with the law’s requirement to expand the program amounts to coercion.
The case has cast a shadow over the presidential campaign. Mitt Romney, after all, was the Massachusetts governor who backed and signed the state health care law that includes the mandate. But as he campaigns for support from his party’s conservative wing in the long and bruising fight for the Republican nomination, he has repeatedly vowed to repeal the federal law if elected president.
“The whole reason we’re having this debate is because our law was so successful and the individual mandate was at the core of that,’’ said Jonathan Gruber, an MIT economics professor and director of the health care program at the National Bureau of Economic Research. “If it weren’t for Mitt Romney, we wouldn’t have national health care reform.’’
Gruber, along with dozens of other economists from universities and think tanks around the nation, signed onto an amicus brief in support of the law’s provision requiring most individuals to purchase insurance. The economists argue that everyone at some point uses health care, and since the law requires medical providers to treat everyone regardless of their ability to pay, society has a right to ensure that individuals are insured to prevent a drain on the system.
Individual states on their own cannot effectively ease the burden hospitals have of caring for the uninsured, say proponents of Obama’s law, including Massachusetts Attorney General Martha Coakley. The provisions of the federal law - broadening access, controlling costs, and barring insurance denials based on preexisting medical conditions - were forged precisely to regulate the interstate features of the health-insurance marketplace, Coakley argues in her brief.
Without the individual mandate, the law’s preexisting conditions provision would not work because people will wait until they are sick to buy insurance, say the law’s supporters. The constitution gives Congress the power to make laws that are “necessary and proper’’ to regulate interstate commerce, they say.
Seven states - including Maine, New Hampshire, and Vermont - have tried enacting preexisting condition laws without passing an individual mandate, resulting in insurance premiums that spiraled out of control, said Ian Millhiser, policy analyst at the left-leaning Center for American Progress. Some insurance carriers simply ceased issuing new individual policies because it no longer made economic sense. In contrast, the average premium in Massachusetts for those seeking non-group, individual coverage dropped by 40 percent following reform.
On Friday, the second anniversary of the federal law, Romney called Obama’s signature reform a “liberal pipedream’’ that is quickly becoming a “national nightmare.’’
Despite the law having benefited many Americans - with 2.5 million more young adults added to their parents’ health insurance and 5.1 million seniors on Medicare saving on prescription drug costs - the latest polls find Americans’ views remain stubbornly divided, with about half continuing to oppose the law.
“The issue has not turned out to be politically very helpful because health care is too polarized,’’ said Robert Blendon, a professor of health policy and political analysis at the Harvard School of Public Health. “For conservatives, it’s symbolic of too much government intervention in American life.’’
The Massachusetts governor, Deval Patrick, who serves as a cochairman of Obama’s reelection campaign, disagrees and said he is confident the law will stand.
“This court has shown from time to time to be an activist court, but if they follow their precedent, they are not going to reverse the mandate,’’ Patrick said. “The mandate should stand because it’s a values statement. Health is a public good and we all have a stake in affordable quality care.’’