The Supreme Court long ago decided the state could use policy power for public health.

I quote from Wikipedia:

In the case of Jacobson v. Massachusetts, 197 U.S. 11 (1905), the Supreme Court of the United States on February 20, 1905, upheld the authority of states to enforce compulsory vaccination laws. The Court's decision articulated the view that the freedom of the individual must sometimes be subordinated to the common welfare and is subject to the police power of the state...... 

The Supreme Court reaffirmed its decision in Jacobson in Zucht v. King (1922), which held that a school system could refuse admission to a student who failed to receive a required vaccination.

Not being a lawyer, I don't understand why these precedents were not used to justify the individual mandate clause of  the Patient Protection and Affordable Care Act. Police power would seem to allow for fines. Requiring people to obtain insurance to pay for medical services is surely likely to improve public health, both in reducing the prevalence of communicable disease and thus the probability of transmission to others, and also to reduce the incidence of complications of existing conditions.