The Supreme Court announced Monday that it will hear cases on the constitutionality of the Patient Protection and Affordable Care Act in March with a ruling expected by the end of June.
This decision has been anticipated since late September when President Barack Obama’s administration asked the high court to uphold the centerpiece insurance provision while 26 states separately asked that the entire law be struck down.
The Court has chosen to hear three out of five challenges brought by a group of Republican governors and attorney generals from 26 states, a business trade group and two individual plaintiffs.
Keith R. McMurdy, a partner at Fox Rothschild in New York City, feels the high court chose these three because they were the least convoluted.
“[The Supreme Court] has the ability to do whatever they want; the question will be what they choose to look at because I think the hottest topic is the individual mandate. The kind of underlying component of that is the extent to which the federal government can regulate the insurance industry, which has been traditionally reserved for the individual states,” says McMurdy.
The high court opted not to review the challenges from public and private employers, so the Thomas More Law Center vs. President Obama and the Liberty University vs. Geithner cases were both left untouched because of jurisdiction issues.
PPACA is aiming to provide more than 30 million uninsured Americans with medical coverage and will immensely affect those in the health sector: brokers, health insurers, hospitals, drug makers and more.
“If the court strikes down the individual mandate while leaving the law’s other provisions intact, it could create havoc in the health insurance marketplace,” says Diane Boyle, vice president of federal government relations at NAIFA. “For example, if the law still requires insurance companies to guarantee issue of an insurance policy, the lack of a mandate would mean individuals would have no incentive to seek health insurance until after they become injured or sick. If only sick and injured people are buying insurance, clearly that’s not sustainable.”
McMurdy believes that although the high court is right-sided — five conservatives and four liberals — it all comes down to Associate Justice Anthony J. Kennedy.
“Kennedy has often been the swing vote on many of the Court's politically charged 5–4 decisions,” says McMurdy.
McMurdy was not surprised that the Court decided to hear the appeals because he thinks the justices “absolutely want to hear this case,” but he feels the challenges that they chose indicate that they are keenly focused on the question: “Can Congress dictate if people need to buy insurance?”
McMurdy shares three questions that the Supreme Court will have to ultimately decide upon:
1. Can we order the American people to purchase something?
2. Can we take away from the states this thing that they have always in the past individually regulated?
3. Can we do it in a way that we can actually pay for it?
McMurdy adds that the Anti-Injunction Act, a part of the Judiciary Act of 1973, could put the whole issue on the back burner until the mandate goes into effect in 2014. He says that the statute prohibits any federal court from issuing an injunction against proceedings in any state court, and vice versa.
He feels confident that by the end of June the Supreme Court will provide some insight.
“I think they will ‘front burner’ this the whole way,” says McMurdy. “Because they know that this has a spawn of huge quantities of litigation and fights that can be set out; everybody is looking to the Supreme Court to declare the applicability of this law.”
Stakeholders in the public health sector are uncertain what’s to come, he adds, saying that those in the human resources departments are wondering now, “What do we do if …?”
This case is very significant when talking about organizational planning, McMurdy adds, since many are not quite sure what to do next — particularly when dealing with compliance issues since they’re supposed to be preparing for the state exchanges to go live in 2014.
“It will cause significant rippling throughout what we’ve done the last two years either way,” says McMurdy.
White House Communications Director Dan Pfeiffer issued a statement Monday explaining why the Act is constitutional and should be upheld:
“Thanks to the Affordable Care Act, one million more young Americans have health insurance, women are getting mammograms and preventive services without paying an extra penny out of their own pocket and insurance companies have to spend more of your premiums on health care instead of advertising and bonuses. We know the Affordable Care Act is constitutional and are confident the Supreme Court will agree,” says Pfeiffer.
Register or login for access to this item and much more
All Employee Benefit Adviser content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access