Obamacare's Insurance Rule Is Upheld by Supreme Court

The Supreme Court, in a landmark ruling Thursday, upheld the individual insurance requirement at the heart of President Barack Obama's health care overhaul.

The court on Thursday handed Obama a campaign-season victory in rejecting arguments that Congress went too far in requiring most Americans to have health insurance or pay a penalty.

Chief Justice John Roberts announced the court's judgment that allows the law to go forward with its aim of covering more than 30 million uninsured Americans.

The court, however, found problems with the law's expansion of Medicaid, but even there said the expansion could proceed as long as the federal government does not threaten to withhold states' entire Medicaid allotment if they don't take part in the law's extension.

The court's four liberal justices, Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan and Sonia Sotomayor, joined Roberts in the outcome. Justices Samuel Alito, Anthony Kennedy, Antonin Scalia and Clarence Thomas dissented.

Stocks of hospital companies moved sharply higher on the decision, including HCA Holdings [HCA  28.14    1.53  (+5.75%)   ] and Community Health Systems [CYH  27.17    1.68  (+6.59%)   ].

Stocks of drug companies and medical device makers are slightly lower for the day as analysts sort through the Supreme Court's ruling. Stocks of the biggest insurance companies are also lower.

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