June 28--By the narrowest possible margin, the U.S. Supreme Court on Thursday upheld virtually all of the Affordable Care Act, the health care reform law considered the central achievement of President Barack Obama.

Chief Justice John Roberts, writing for the 5-4 majority, said the requirement that almost all Americans purchase health insurance is constitutional. The penalty for failing to obtain insurance, he ruled, is a tax -- and Congress has broad authority to levy taxes.

"Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness," Roberts wrote.

The majority also upheld the law's expansion of Medicaid, the health care program for the poor, but said the law cannot require states to either join that expansion or drop out of Medicaid. Instead, the court ruled, states choosing not to expand Medicaid can continue to get existing federal Medicaid funds.

The decision ends a two-year legal battle over the most controversial aspects of the health reform law, which touches virtually every American. But it did not end the political battle, which escalated in the minutes after the ruling was made public shortly after 9 a.m.

Republicans vowed to step up efforts to repeal the law. Democrats claimed vindication from the court.

"Today's decision was a victory for people all over this country," Obama said in remarks from the White House. "I know the debate over this law has been divisive. ... I did this because I believed it was good for the country."

House minority leader Rep. Nancy Pelosi said "Americans will benefit from critical patient protections, lower costs for the middle class, more coverage for families, and greater accountability for the insurance industry."

Local Democrats were more cautious in their reactions. Gov. Jay Nixon, who repeated his opposition to the mandate this week, said he was reviewing the opinion. A spokesman for Sen. Claire McCaskill said her goal remains "affordable, accessible health care for Missouri" but made no specific reference to the opinion.

Republicans, who call the law Obamacare, were less reserved.

Likely GOP presidential nominee Mitt Romney said the ruling increased the importance of replacing Obama. "Obamacare was bad policy yesterday. It's bad policy today," he said.

Other Republicans vowed to make repeal of the law a central issue in this fall's campaign.

"Stopping Obamacare is now in the hands of the American people," said Kansas Gov. Sam Brownback.

Sen. Roy Blunt, a Missouri Republican, said "People that don't like this are going to be very upset about it. ... This is a bad idea, and we can't afford it."

Rep. Tim Huelskamp, a Kansas Republican, called the decision an advance of "government tyranny." GOP Rep. Kevin Yoder called the law "fundamentally flawed and unworkable."

House Republicans are scheduled to take another repeal vote in July, but it has no chance in the Senate, which is controlled by Democrats.

While politicians bickered over the results of the ruling, the court's decision provided some clarity for insurers, health care providers and patients -- at least for now. Popular parts of the ACA, like the rule allowing young adults to stay on their parents' policies or help for seniors with drug costs, will remain intact.

The requirement that almost all individuals purchase insurance or pay what is now called a tax doesn't take effect until 2014.

Most health insurers were particularly relieved the so-called individual mandate was upheld. The law requires them to cover people with pre-existing medical conditions, but they argued they would go bankrupt unless the mandate was in place.

"Everyone in health care industry is sighing in relief that this part of it, the individual mandate question, is over," said Tom O'Donnell, a Kansas City attorney who represents doctors and hospitals.

In a statement, Blue Cross and Blue Shield of Kansas said it "will continue to implement the law and educate our members on what it means for them."

While much of the attention Thursday focused on the individual mandate in the health care law, the court's ruling on Medicaid may be equally significant over the long term, experts said.

Expanded Medicaid coverage is considered essential in providing health care for more than 30 million Americans who lack insurance now. The proposed expansion in the law would make it easier for middle class families to qualify for Medicaid, and improves the benefits from it.

But states, which share the cost of Medicaid with the federal government, have resisted -- claiming the expansion would eventually cost them billions of dollars. And they bitterly accused the federal government of blackmailing states by threatening to cut off all of the Medicaid funds if they chose not to expand the program.

The court's ruling that such a cutoff would violate the Constitution may make it easier for states to avoid the expansion, potentially leaving millions still uninsured.

States now have "very little" incentive to expand Medicaid, outgoing Kansas state Sen. John Vratil said. "I think you'll see a lot of states just sticking with their current programs."

Advocates for health care recipients said they hope states will pursue the expansion anyway.

"We support the federal law as it pertains to the expansion of Medicaid, and hope that Missouri and Kansas will comply with the provisions," said Steve Roling, president and CEO of the Health Care Foundation of Greater Kansas City.

While states will have to wrestle with Medicaid, they also now face quick decisions on setting up health care exchanges, where residents can compare policies and purchase coverage. The law requires states to establish a framework for their exchanges by the end of the year or face a federal takeover of the process.

Missouri and Kansas, like many other states, have delayed implementation of the exchanges, which they see as a tacit endorsement of Obamacare.

The decision could mean changes locally, too. Kansas City Mayor Sly James said more insured patients might reduce the need for taxpayer support for the Truman Medical Center.

And "I'm happy my kids will continue to be covered," James said.

Businesses and insurers spent Thursday determining their next steps. Many had waited until the court ruled to examine their own policies and procedures regarding employees' health care.

While repeal remains a possibility, the court's ruling provides some certainty for business, experts said. "Employers are behind the curve now if they're not already planning for the 2013 benefit year," said insurance broker Ed Fensholt.

Thursday's court ruling, on the final day of its 2012 session, provided moments of high drama and at least some initial confusion.

Hundreds of protesters for and against the ACA gathered on the steps of the court, surrounded by the wires, lights, and cameras of dozens of television reporters. The justices had earlier declined to allow camera inside the court for the announcement of the decision.

SCOTUSblog reported more than 800,000 viewers in the moments leading up to the decision.

At least two cable networks -- CNN and Fox -- initially reported that the individual mandate in the law had been struck down, a mistake some called a "Dewey Defeats Truman" moment. Those incorrect reports were then tweeted by several lawmakers, who later removed the erroneous information.

Some conservatives took heart in the court's decision that Congress did not have the power to impose the individual mandate through its power to regulate commerce. That decision, they said, would make it harder to use the commerce power in future legislation.

"Had Obamacare been upheld under the Commerce Clause, then our Constitution would have been a dead letter without limits on congressional power," wrote James Barton for National Review Online.

Some observers were surprised at Roberts' role in providing the deciding vote for the ACA. The chief justice most often sides with the conservatives on the court.

"I think this reflects pretty favorably on Roberts," said Kansas City lawyer Brian Finucane. "He's a smart guy, aware of the political controversy, but rendered his decision on a principled legal ground, that Congress has the authority to tax."

While the decision ends the legal battle over the individual mandate and Medicaid, other legal challenges to parts of the law are still underway. Several groups are suing over the government's requirement that private insurance policies include contraception coverage, even from some religiously affiliated organizations.

In his dissenting opinion, Justice Anthony Kennedy -- joined by three other justices -- said the entire health care law was unconstitutional.

"The values that should have determined our course today are caution, minimalism, and the understanding that the Federal Government is one of limited powers," Kennedy wrote.

"But the Court's ruling undermines those values at every turn. In the name of restraint, it overreaches. In the name of constitutional avoidance, it creates new constitutional questions. In the name of cooperative federalism, it undermines state sovereignty."

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