On June 28, the Supreme Court issued its much anticipated decision in National Federation of Independent Business v. Sebelius , which upheld the constitutionality of the key components of the Patient Protection and Affordable Care Act (aka Obamacare). Although most of the debate surrounding the constitutionality of the act focused on the applicability of the commerce clause, in the end, Chief Justice John G. Roberts Jr. joined the four justices constituting the “liberal wing” of the court and held that the act could be sustained pursuant to the power to levy taxes vested in Congress pursuant to Article 1 of the Constitution.

The most controversial provision of the act is the individual mandate, which requires most individuals to maintain “minimum essential” health insurance coverage. For individuals who are not otherwise exempt and who do not receive health insurance through an employer or government program, the way to satisfy this requirement is to purchase insurance from a private carrier. Beginning in 2014, those individuals who do not comply with the mandate must make a “shared responsibility payment” to the federal government. The act characterizes this payment as a “penalty” to be paid to the Internal Revenue Service with an individual’s income taxes, and is to be assessed and collected in the same manner as tax penalties. The operational provisions of the individual mandate are contained in Section 5000A of the Internal Revenue Code.

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