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  • The Affordable Care Act and the United States Supreme Court

    The United States Supreme Court heard oral arguments on March 26-28, 2012, regarding the constitutionality of the Patient Protection and Affordable Care Act of 2010 (“the Affordable Care Act”). This historic and heavily publicized event has renewed the public’s focus on both health care reform and the role and inner workings of the Supreme Court.

    The Court’s ruling is not expected until June 2012. It is difficult to predict how the Court will decide the case based on questions asked by the justices during oral arguments. On the question of the individual mandate, court watchers noted that questions from the justices were tough for both the government and the challengers and did not reveal where they will come out. The Court certified four separate questions for argument:

    Anti-Injunction Act
    On Monday, the Court heard arguments on the question of whether, if the Individual Mandate’s penalty is held to qualify as a tax, the Anti-Injunction Act bars any legal challenge at this time by denying jurisdiction to the courts. Practically speaking, the Anti-Injunction Act prohibits the courts from hearing legal challenges to a tax law before somebody has actually had to pay the tax. In this case, that would delay action on the Individual Mandate until after it goes into effect in 2014. To download the PDF click here.

    Commerce Clause
    On Tuesday, the Court focused on the constitutionality of the Individual Mandate with the question of whether Congress has the power, under the Commerce Clause, Article 1, Section 8, of the United States Constitution, to require every U.S. resident either to procure health insurance or to pay a fine. Put another way, does the Individual Mandate represent an example of the government regulating or prohibiting an economic activity or is the mandate not justified under either Congress’ power to regulate interstate commerce or its power to tax?

    On Wednesday, the Court first looked at the question of whether the remaining provisions of the Affordable Care Act should become effective and enforceable if the Individual Mandate is held to be unconstitutional. Novel or complex legislation typically contains a "severability clause," which confirms the intent of the legislature that, should some provisions in the proposed law be ruled unconstitutional, the remainder of the law may still go into effect. The Affordable Care Act lacks a severability clause. To download the PDF click here.

    Medicaid Expansion
    The oral arguments concluded on Wednesday with the question whether, if the United States Department of Health and Human Services threatens to withdraw all federal Medicaid funding in order to induce states to expand Medicaid eligibility, such a threat is unconstitutionally coercive. While the Congress may place conditions on a state’s receipt of federal tax revenues, at what point do such conditions cross the line and constitute unconstitutional coercion? To download the PDF click here.

    Next Steps
    ASHRM, through its Advocacy Task Force, will continue to monitor developments in the wake of these historic arguments and communicate significant developments to the membership. For those who are interested, copies of the transcripts of each day’s arguments will be made available through the ASHRM web site. For a view from inside the courtroom, go to http://ahahealthreformlaw.wordpress.com/. Dominic Perella, attorney at Hogan Lovells US LLP and one of the lead authors of the AHA’s amicus briefs in the ACA case, attended each day’s arguments and provided a summary of the key points made and questions asked affecting hospitals.