The U.S. Supreme Court upheld the core of President BarackObama's health-care overhaul, giving him an election-year triumphand preserving a law that would expand insurance to millions ofpeople and transform an industry that makes up 18 percent of thenation's economy.

The justices, voting 5-4, said Congress has the power to makeAmericans carry insurance or pay a penalty. That requirement is atthe center of the law, which also forces insurers to cover peoplewith pre-existing medical conditions. The court modified the law'sextension of the Medicaid program for the poor by saying thefederal government can't threaten to withhold existing money fromstates that don't fully comply.

The ruling frames the health-care issue for this year'selections and is a victory of symbolism as well as substance forObama. Chief Justice John Roberts, a Republican appointee, joinedfour Democratic-selected justices to give Obama a majority on a lawthat has divided the country along ideological and partisan linesthroughout his presidency.

Roberts, writing for the court, said Congress had the authorityto impose the insurance requirement under its power to levy taxes.“Because the Constitution permits such a tax, it is not our role toforbid it or to pass upon its wisdom or fairness,” he wrote.

“The highest court in the land has now spoken,” Obama saidafterward in a televised statement from the White House.

“We will continue to implement this law,” and search forimprovements, Obama said. “What we won't do, and what the countrycan't afford to do, is re-fight the political battles of two yearsago or go back to the way things were.”

The decision on the Patient Protection and Affordable Care Actis the climax to an epic legal fight that featured the longestcourtroom arguments in 44 years, a record number of briefs andextraordinary public interest in a Supreme Court case. The casetested both the constitutional powers of Congress and thewillingness of the Roberts court to overrule the other two branchesof the federal government.

Republican-appointed Justices Antonin Scalia, Anthony Kennedy,Clarence Thomas and Samuel Alito dissented, saying they would havestruck down the entire statute.

“The fragmentation of power produced by the structure of ourgovernment is central to liberty, and when we destroy it, we placeliberty at peril,” the dissenters wrote. “Today's decision shouldhave vindicated, should have taught, this truth; instead, ourjudgment today has disregarded it.”

Unusual Step

Among the majority, Justices Ruth Bader Ginsburg and SoniaSotomayor voted to uphold the entire statute. Justices StephenBreyer and Elena Kagan agreed with Roberts in limiting the Medicaidexpansion.

Kennedy and Ginsburg each took the unusual step of reading asummary of their opinion from the bench. All told, the justicestook more than an hour to announce the ruling before a packedcourtroom that included members of Congress, retired Justice JohnPaul Stevens and Solicitor General Donald Verrilli, the Obamaadministration lawyer whose defense of the law drew criticism.

The dispute marked the first time the Supreme Court hadconsidered a president's defining legislative accomplishment in themiddle of his re-election campaign. The court hadn't taken up a lawof comparable scope since the justices overturned part of theNational Industrial Recovery Act in 1935 during President FranklinRoosevelt's New Deal.

The law marks the biggest change to the U.S. health system sinceMedicare and Medicaid were established in 1965. It was designed toexpand coverage to at least 30 million people — primarily byexpanding Medicaid and setting up online markets where consumerscould buy insurance — while controlling the soaring costs of healthcare.

Republicans, including presidential candidate Mitt Romney, havecalled for its repeal, and House Majority Leader Eric Cantor, aVirginia Republican, scheduled a vote on that effort for the weekof July 9.

Romney said he disagreed with the Supreme Court's decision. Hesaid what the justices failed to do he would “do on my first day ifelected president of the United States.”

'Urgency' of Repeal

Obama's health-care legislation “puts the federal governmentbetween you and your doctor,” Romney told reporters in Washington.Though he pushed through a similar plan when he was governor ofMassachusetts, he has said such a measure isn't applicablenationally.

“The president's health-care law is hurting our economy bydriving up health costs and making it harder for small businessesto hire,” House Speaker John Boehner, an Ohio Republican, said in astatement.

The law was challenged by 26 Republican-controlled states and asmall-business trade group. They contended the measure exceededCongress's constitutional powers to regulate interstate commerceand impose taxes.

The challenge focused on the insurance mandate, which requiresAmericans to get coverage by 2014 or pay a penalty. The concept waschampioned by Republicans years ago as an alternative to Democraticproposals for a single government-run health system.

Roberts accepted the Republicans' commerce argument, whilevoting to uphold the mandate under Congress's taxing power.

While the federal government “does not have the power to orderpeople to buy health insurance,” Roberts wrote, “the federalgovernment does have the power to impose a tax on those withouthealth insurance.” The law “is therefore constitutional because itcan reasonably be read as a tax.”

Roberts said that, for most Americans, the amount of the penaltywill be far less than the cost of insurance.

“It may often be a reasonable financial decision to make thepayment rather than purchase insurance,” he wrote. “Although thepayment will raise considerable revenue, it is plainly designed toexpand health insurance coverage. But taxes that seek to influenceconduct are nothing new.”

The ruling will shape Roberts' legacy as much as Obama's. The57-year-old chief justice — whose 2005 nomination Obama opposed asa senator — has been a leader of the court's conservative wing onother issues.

Medicaid Expansion

The Medicaid expansion was designed to extend eligibility tothose with incomes up to 138 percent of the federal poverty line.States that didn't comply with the new expansion would have lostall or part of their share of federal Medicaid funding.

Roberts said Congress can require states to meet conditions toreceive new Medicaid money, though it can't take away existingfunding. He said Medicaid spending accounts for more than 20percent of the average state's total budget, with the federalgovernment covering at least half those costs.

“The financial 'inducement' Congress has chosen is much morethan 'relatively mild encouragement' — it is a gun to the head,”Roberts wrote. “What Congress is not free to do is to penalizestates that choose not to participate in that new program by takingaway their existing Medicaid funding.”

The ruling removes some of the uncertainty the health industryhad faced about the future of government policy. By upholding theindividual mandate, the court left intact a provision that willgive insurers such as UnitedHealth Group Inc. millions ofrelatively healthy, low-cost policyholders.

Other parts of the law will help the drug industry, includingthe Medicaid expansion and the system of online insurance marketsthat will make it easier for people to buy policies. Hospitals alsomay benefit from the expansion, as will insurers that focus onmanaging states' Medicaid programs, including Amerigroup Corp. andCentene Corp.

Hospital companies led by HCA Holdings Inc. jumped in New Yorktrading, and Medicaid insurers paced by Molina Healthcare Inc.rose. Commercial carriers such as WellPoint Inc. fell in the faceof the law's new regulations. HCA, the biggest U.S. hospital chain,rose 9.1 percent to $29.03 at 12:28 p.m., after the Nashville,Tennessee-based company earlier climbed as much as 12 percent.

Tenet Healthcare Corp., the third-biggest chain, jumped as muchas 13 percent, while Long Beach, California-based Molina rose asmuch as 9 percent. Indianapolis-based WellPoint, the second-largestU.S. health insurer, declined 4.9 percent to $64.58.

Some parts of the law have already gone into effect, includingprovisions that close a gap in prescription-drug coverage underMedicare, allow 2.5 million young adults to stay on their parents'insurance until age 26, and provide free mammograms, colonoscopiesand flu shots.

Long Sought

The health-care measure's enactment in March 2010 marked theculmination of decades of efforts by Democrats and Republicansalike to put in place a universal health-care program. For Obama,congressional approval marked a victory that had eluded presidentsfrom Harry Truman to Bill Clinton.

Passage in the Democratic-controlled Congress came only aftermonths of lobbying, deal-making and parliamentary maneuvering. Inthe end, not a single Republican voted in favor of the law. Themeasure passed the House by a 219-212 tally.

From the beginning, the law divided the public, with oppositionfueling the Tea Party movement and helping produce the 2010Republican takeover of the House. A Bloomberg National Pollconducted in March found that 37 percent of respondents said thelaw should be repealed, 11 percent said it should be left alone and46 percent said it may need small modifications.

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