Previewing The Supreme Court Decision(s)

Tyler Durden's picture

We posted this on Monday. With the SCOTUS ruling due out in minutes, here again is a preview of the various permutations that can come out today, and their impact on capital markets.

The Obamacare Outcome Matrix

BofA outlines five possible scenarios and their potential impact across the healthcare sectors. They base the likelihood of their scenarios on a review of the March oral arguments, previous circuit court decisions, as well as surveys of legal experts and former Supreme Court clerks. Everything you need to know about the possible outcomes and actions to take.


Supreme Court upholds the Individual Mandate: In this case, the Court would uphold the Affordable Care Act, and the next catalyst would be the upcoming elections. In addition, there remain questions as to whether the health reform law can be implemented by 2014 as many states have delayed implementation awaiting the court’s decision, and the federal government may not be able to implement exchanges in all of those states. This scenario would be positive for the hospital sector, in our view.

Supreme Court strikes the Individual Mandate, but, upholds the rest of the law: In this scenario, the Court would strike the individual mandate, but, keep in place the rest of the law, including all of the health insurance provisions. We would view this scenario negatively for the managed care sector.

Supreme Court strikes the Individual Mandate, along with related health insurance provisions (guaranteed issue, community rating, etc.): In this scenario, the Court would strike the individual mandate, along with several related health insurance provisions – particularly guaranteed issue and community rating provisions, as the Obama administration also recommended striking these down if the mandate were struck. This scenario would result in fewer covered lives (16 million vs. 32 million) according to the Congressional Budget Office, but, would maintain the Medicare payment reforms and payment reduction provisions.

Supreme Court strikes down the entire Health Care Law: In this scenario, the court would find the individual mandate unconstitutional, and not severable. This scenario would be a negative for hospitals, in our view, but generally viewed positively for managed care (other than Medicaid managed care).

Supreme Court strikes down the Medicaid expansion: In this scenario, the Court finds that the mandated expansion of Medicaid to all beneficiaries below 133% of poverty is coercive to the states, but, would leave a significant hole in coverage for low income individuals, that would need to be addressed by Congress.


Source: Bank Of America Merrill Lynch

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Cognitive Dissonance's picture

Much ado about nothing regardless of what we are told. The sick care industry is growing exponentially and will not survive in its present form.

But it does serve as a wonderful red meat distraction for the left-right paradigm.

GetZeeGold's picture



Just need some tort reform.......and a bigger jail cell so we have room to stick the lawyers with the bankers.


Precious's picture

An individual mandate is "cruel and unusual punishment."

jaffa's picture

The technology represents computers and communications attributes that can be networked to build systems for moving health information. Informatics is yet another integral aspect of HIT. Thanks. Regards,

hcg 1234

wify's picture

With WIC benefits, mothers are able to get food and supplies for free or at a reduced cost. To reach out to low-income women who are concerned about making ends meet for their family, focus on the financial benefits the program can bring. Thanks for sharing.
ipc athletics

MachoMan's picture

Why the fuck do donkeys keep coming on here talking about tort reform...  TORT REFORM IS A CREATURE OF THE 70s...  Virtually every state has ALREADY passed some form of tort reform...  quite a few times in contravention of those states' constitutions... 

If you want tort reform, then you need a corresponding FORCED reduction in premiums without a reduction in coverage.  The insurance industry is highly regulated and every once and a while a state doesn't just get on its knees and suck off the insurance industry.  What happens most of the time is that insurance companies get tort reform, but somehow rates don't decrease...  hmmm...

If you want a historical lesson, go back to America's first look at tort reform with the lobbying of railroad companies trying to limit their liability for accidents on the rail...  [hint: the fallout and social loss caused at least a few states to amend their constitutions to prohibit limits to tort damages].

It's as though people don't understand the legal system, in its present form, is hundreds and hundreds of years old...  as if every issue today hasn't already been addressed ad nauseum by people who were probably generally more familiar with how the whole puzzle fits together and various areas of the law interact with one another...  as well as the incentives and policies behind implementation...  nothing new under the sun.

Spastica Rex's picture

But it does serve as a wonderful red meat distraction for the left-right paradigm.

And we have the pussy Democrats to blame for that.

toady's picture

No, its the just say no republicans.


mrktwtch2's picture

'ive fallen and i acnt get up..

SheepDog-One's picture

I got my medical assistant degree in my bathrobe online! I sure hope the USSC doesnt bend me over the table!

MachoMan's picture

Sounds like you're now qualified to bill the shit out of medicare and medicaid.  Just be sure to be indignant when they recoup $.10 on the dollar.

hedgeless_horseman's picture



Everything you need to know about the possible outcomes and actions to take.

The Act was for the Health Insurers.  If SCOTUS kills it, then all the Health Insurance names will take a big hit.

hedgeless_horseman's picture



HIPAA's real and intentional effect is to guarantee that insurance companies have access to everyone's pre-existing conditions.

Sad how the health insureres and media sold HIPAA as a patient privacy act.

Spastica Rex's picture

Magic doesn't work without a willing suspension of disbelief. You're not approaching this right.

Precious's picture

You mean their gross margins will go from 90% to 80%.  They should be able to survive the hit.

HungrySeagull's picture

It would be good to see it overturned.

Congress overstepped it's limits per the Constitution.

The Insurers will be fine. They will find a way to bill the difference.

Cognitive Dissonance's picture

"The Act was for the Health Insurers."

Remember when this was being pushed as the solution and all the insurance companies jacked their rates just before it was made law......because of all the "mandates" taking effect in 2014-15?

Bet they will lower them if this is overturned.....right?

MachoMan's picture

well...  daddy had to pay for the losses he took in the .com bust...  and probably subsequent busts... (something daddy doesn't like to talk about).

maybe if they keep claiming that they need tort reform, someone will eventually believe they haven't gotten it already...  of course, if they didn't lower premiums WITH tort reform, I doubt they're going to do much with mandates being chunked...

I think one of the saddest aspects of our present economy/government is that all of the companies that continue to get handout after handout...  favorable law after favorable law...  government mandated monopoly after monopoly...  still can't fucking keep their heads above water... unbelievable.

the not so mighty maximiza's picture

Since we are all fucked, free health care for everyone

Splootch's picture

Again...BofA coming with prophetic stuff that just make no sense...remeber post greek election when they came out with 3 scenario and none of them did take place ...poo poo stuff into the la-la land.

midgetrannyporn's picture

scotus is totally and shamelessly partisan-political. i forget the makeup of the bench but whatever it is will determine the outcome imo.

partimer1's picture

we will be fucked for a long time regardless what decision they make.  It doesn't seem to me that they know what they are doing.  Nobody gives a shit about patient care, and everyone cares about how much money they will make out of the sick people.   

Dr. Engali's picture

All I know is since the "affordable healthcare" act was passed my premiums have doubled.

midgetrannyporn's picture

the humana ceo was on cnbc this a.m.. i wonder what his bonus was like last year.

Jim in MN's picture

And while you're waiting...the hottest shit yet at Fukushima!  Gold medal quality radiation!  Also features nice photo of a guy in the exclusion zone with his rad counter clocking all the way over (can't read the scale but it's close to maxed).

RECORD amounts of radiation have been detected at the Fukushima nuclear reactor, further hampering clean-up operations.

TEPCO, the operator of Japan's crippled nuclear plant, took samples from the basement of reactor number 1 after lowering a camera and surveying instruments through a drain hole in the basement ceiling.

Radiation levels above radioactive water in the basement reached up to 10,300 millisievert an hour, a dose that would kill humans within a short time after making them sick within minutes.

The annual allowed dose for workers at the stricken site would be reached in only 20 seconds.

"Workers cannot enter the site and we must use robots for the demolition," said TEPCO.

The Fukushima operator said that radiation levels were 10 times higher than those recorded at the plant's two other crippled reactors, number two and three.

This was due to the poor state of the nuclear fuel in the reactor compared to that in the two others.

The meltdown at the core of three of Fukushima's six reactors occurred after the March 11, 2011 earthquake and ensuing massive tsunami shut off the power supply and cooling system.

Demolition of the three reactors as well as the plant's number 4 unit is expected to take 40 years and will need the use of new technologies.

dwdollar's picture

If Uncle Scam can make you buy something for merely existing as a US citizen, he can make you do anything.

The mere fact this was "passed" by CONgress means you live in a tyranny. If you don't believe that, you're wrong.

Have fun celebrating the 4th of July... slaves.

IAmNotMark's picture

I'm not celebrating Independance day...I"m mourning it.

Dr. Engali's picture

The entire issue will be decidedby Kennedy,and he has a mixed track record when it comes to expanding the powers of the state.

WhiskeyTangoFoxtrot's picture

Bring the PAIN!! It's gonna be a shitstorm either way. I don't usually eat popcorn for breakfast . . . 


digalert's picture

30,000 drones over the USA to aid implementation of Obamacare, it's for your health.

BlackGoldTexasTea's picture

Like it even matters.  USD loses reserve status and the petrodollar system ends; then the United States can no longer run trade deficits. 

Shortages of basic supplies.  At least you have a promise of "free" medical care on paper still, though.

TWSceptic's picture

“That which is about to fall deserves to be pushed.”


Let the keynesians spend until the system implodes, after that we can say "told you so" and hopefully take over.

partimer1's picture

Congratulations!!  we finally got a fucking circus in town. 

Crummy's picture

The way I see it, that individual insurance mandate is the saving throw to keep the muni-bond shithouse churning for another 20-30 years.

If they strike that down... well, this ought to be interesting.

Bastiat's picture

It is upheld, even the individual mandate.  They got around the Commerce Clause question by saying it's a tax if you refuse the mandate.  Roberts went left.


nah's picture

SCOTUS is pro business bitchez