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In what appears to be a victory for the White House, the Supreme Court upholds the 2010 health care law.
The majority opinion was written by Chief Justice John Roberts, who held that the law was a valid exercise of Congress's power to tax.
Roberts re-framed the debate over health care as a debate over increasing taxes. Congress, he said, is "increasing taxes" on those who choose to go uninsured.
The 2010 law, the Affordable Care Act, requires non-exempted individuals to maintain a minimum level of health insurance or pay a tax penalty.
The essence of Roberts's ruling was:
"The Affordable Care Act is constitutional in part and unconstitutional in part," Roberts wrote.
"The individual mandate cannot be upheld as an exercise of Congress's power under the Commerce Clause.
That Clause authorizes Congress to regulate interstate commerce, not to order individuals to engage in it."
But "it is reasonable to construe what Congress has done as increasing taxes on those who have a certain amount of income, but (who) choose to go without health insurance. Such legislation is within Congress's power to tax."
The law, Roberts wrote, "makes going without insurance just another thing the Government taxes, like buying gasoline or earning income. And if the mandate is in effect just a tax hike on certain taxpayers who do not have health insurance, it may be within Congress's constitutional power to tax."
He said "The question is not whether that is the most natural interpretation of the mandate, but only whether it is a 'fairly possible' one."
He said the Supreme Court precedent is that "every reasonable construction" of a law passed by Congress "must be resorted to, in order to save a statute from unconstitutionality."
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NBC's Pete Williams reported that Roberts reasoned that "there's no real compulsion here" since those who do not pay the penalty for not having insurance can't be sent to jail. "This is one of the scenarios that administration officials had considered that if the court did this they would consider it a big victory," Williams said.
But in a major victory for the states who challenged the law, the court said that the Obama administration cannot coerce states to go along with the Medicaid insurance program for low-income people.
The financial pressure which the federal government puts on the states in the expansion of Medicaid "is a gun to the head," Roberts wrote.
"A State that opts out of the Affordable Care Act's expansion in health care coverage thus stands to lose not merely 'a relatively small percentage' of its existing Medicaid funding, but all of it," Roberts said.
Congress cannot "penalize States that choose not to participate in that new program by taking away their existing Medicaid funding," Roberts said.
The Medicaid provision is projected to add nearly 30 million more people to the insurance program for low-income Americans -- but the court's decision left states free to opt out of the expansion if they choose.