In a 5-4 ruling, the Supreme Court decided the individual mandate was constitutional under Congress's power to tax.
Chief Justice Roberts, a Bush appointee, was the swing vote on the court, deciding that Congress did not have the authority to enforce the mandate under the commerce clause, but instead that Congress' authority to tax was broad enough to encompass the mandate.
Amy Howe from Scotusblog explains the ruling:
In Plain English: The Affordable Care Act, including its individual mandate that virtually all Americans buy health insurance, is constitutional. There were not five votes to uphold it on the ground that Congress could use its power to regulate commerce between the states to require everyone to buy health insurance. However, five Justices agreed that the penalty that someone must pay if he refuses to buy insurance is a kind of tax that Congress can impose using its taxing power. That is all that matters. Because the mandate survives, the Court did not need to decide what other parts of the statute were constitutional, except for a provision that required states to comply with new eligibility requirements for Medicaid or risk losing their funding. On that question, the Court held that the provision is constitutional as long as states would only lose new funds if they didn't comply with the new requirements, rather than all of their funding.
In other words, ObamaCare just became the biggest tax hike in American history.
We'll have more on this later today, but for now, you can read the ruling yourself here.