Posts Tagged ‘individual responsibility requirement’

First Quarter: Supreme Court Ready to Tackle the ACA

Tuesday, November 15th, 2011

The awaited day is here. The Supreme Court announced that it will hear the case against the Affordable Care Act’s (ACA) individual responsibility requirement (and other related requests). For those immersed in football season, this is the Super Bowl of legal challenges.

Game time.
Be prepared, the oral arguments will last five and a half hours. Here’s a breakdown:

  • • The Court will devote two hours to the constitutionality of the individual responsibility requirement
  • • Ninety minutes will address “whether the ACA must be invalidated in its entirety because it is nonseverable from the individual mandate.”
  • • One hour is devoted to whether the Anti-Injunction Act (AIA) prevents a ruling before the individual responsibility requirement goes into effect in 2014.
  • • The final hour will address the constitutionality of the expansion of Medicaid

The Court will hear the case at the end of March 2012, releasing a decision sometime in the summer if not before. The ruling will come at the height of the presidential campaign, ensuring its outcome will affect the election.

What is at stake?
The Court will address three main issues:

Individual responsibility requirement. This is the centerpiece of the legal challenges to the ACA around the country. Anti-ACA supporters take issue with the requirement that most Americans purchase health insurance by 2014, if they can afford it. The Court will consider the constitutionality of the individual responsibility requirement and will subsequently review the severability of the mandate from the rest of the law. In other words, if the individual responsibility requirement fails, can the ACA stand?

Anti-Injunction Act (AIA). The Anti-Injunction Act states that consumers cannot challenge a tax law until they have paid the tax. This issue was raised in the 4th circuit opinion regarding the two Virginia cases. The argument is that jurisdiction to rule on the individual responsibility requirement is precluded by the AIA simply because it has not happened yet! This would lead to all cases against the individual responsibility requirement being thrown out until 2015. If the AIA is upheld, millions of Americans would have health insurance through Exchanges and Medicaid prior to a determination of the constitutionality of the individual responsibility requirement.

Medicaid expansion. Medicaid expansion as a threat to state autonomy was raised initially by the 26 states and National Federation of Independent Business (NFIB) case, originating in Florida. The group maintains that the Federal government is coercing states, essentially forcing them to participate in the Medicaid program. This coercion, the states maintain, is unconstitutional. The Medicaid question has yet to be supported by any lower court; however, analysts believe adding the Medicaid expansion issue has raised the profile of the case.

The decision to address the individual responsibility requirement was expected while the Medicaid expansion was not. However, the Court seems to be giving a nod to the concerns of all participants, agreeing to review the issues presented in the Florida case as well as the AIA, an issue raised in the 4th circuit.

Analysts agree that the main issue at stake remains the constitutionality of the individual responsibility requirement and further, whether or not it may be severed from the law. If the requirement is struck down while the rest of the law is left intact, it will raise a number of policy and political questions going forward. Analysts have explored the consequences of life without the individual responsibility requirement, concluding that the ACA could still function though it would not be as successful at expanding insurance coverage. Insurers, however, would be sure to raise a major outcry over guaranteed issue and community rating provisions if the requirement falls.

Place your bets.
The 26-state and NFIB case (often labeled the Florida case) dominates the spotlight as its arguments regarding the individual responsibility requirement won over 11th circuit Judge Roger Vinson. Vinson ruled against the individual responsibility requirement and threw out the ACA altogether, maintaining that the law was not viable without the requirement.

The Obama Administration, however, is feeling optimistic after having two conservative judges rule in their favor. The first is Judge Jeffrey Sutton of the 6th circuit, a former law clerk for Justice Antonin Scalia. The second is Judge Laurence Silberman of the DC Circuit who eloquently defended the individual responsibility requirement and is cited as a respected conservative.

In the end, the Obama Administration believes that they have a strong case in support of the individual responsibility requirement. Yet if SCOTUS embraces the Anti-Injunction Act, it could delay any decision until 2015. This path offers SCOTUS a way out of the political quagmire that they face in light of the 2012 elections. Yet, maybe not – with an early June decision, four months remain in the campaign season. As one analyst noted, “That’s a very long time in politics, especially for something that won’t have any immediate, tangible effect on people’s lives”

Game on.
Brief filings will begin as early as this December as all sides prepare for their legal Super Bowl. So, bring on the wings and get comfy – this is one of the longest oral hearings on record. We will all be watching for the last minute Hail Mary.

– Eva Marie Stahl, Policy Analyst

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ACA Opponents Grab a (Partial) 11th Circuit Win

Tuesday, August 16th, 2011

In a 2-1 decision this past Friday, the 11th Circuit U.S. Court of Appeals in Atlanta handed ACA opponents a partial victory and dealt a partial blow to the Obama Administration and ACA supporters. While the ruling is frustrating to those working tirelessly on ACA implementation, the good news is that the entire law wasn’t ruled unconstitutional. The individual mandate provision – or the requirement that everyone who can afford insurance must obtain it – was struck down, raising doubts about the long-term sustainability of the ACA. However, let us grab the bits of good news that are sprinkled (lightly) throughout this ruling.

Medicaid is no bully.

 Medicaid expansion is at the heart of expanding coverage to millions of uninsured Americans in the coming decade. The appeals panel confirmed that the Medicaid program is a legitimate federal mechanism to expand coverage to the uninsured. It is not a coercive tool, as charged by the plaintiffs; rather, Medicaid is a longstanding federal-state partnership to address the uninsured in states. The panel writes “If states bear little of the cost of expansion, the idea that states are being coerced into spending money in an ever-growing program seems to us to be ‘more rhetoric than fact.’”

The individual mandate is one provision of many…

It is worth noting that the panel declined to uphold Judge Vinson’s lower court ruling that the entire law be thrown out. Therefore, it raises the possibility that the individual mandate could be severed from the ACA, leaving the law intact. This does raise concerns for ACA supporters and insurers alike because the mandate is a way to include everyone – healthy and sick – and is used as a tool for calibrating risk.

Politics aside…or front and center?

Pam Bondi, the Florida AG leading the 26 state lawsuit against the ACA, commented that due to the bipartisan nature of the 11th Circuit ruling, “politics are out of this now.” (Judge Hull of the majority opinion is a Clinton appointee; however, she is also cited as a compromise candidate during a fierce partisan nomination battle for judges during the mid-nineties). Did Bondi really say that? If that were the case, the 6th Circuit ruling where Republican appointed Judge Sutton upheld the individual mandate would have marked the beginning of the end of ‘politics.’ Saying ‘this is the end of politics’ surrounding these ACA legal challenges is merely politics. Yes, it is confusing. What is clear, however, is that the individual mandate provision of the ACA is bound for the Supreme Court. All pundits agree that the Justices cannot avoid taking an ACA case– as to when the Justices take the case may depend on, well, politics.

Therefore, perhaps you feel a tinge of pity for the Supreme Court as everyone waits to see what ruling they will choose to hear. Will it be the 4th Circuit where we are still awaiting an appeals decision? Will it be the 6th Circuit that has already petitioned the Supremes? Or will it be the 11th Circuit where we are awaiting the Administration’s decision as to whether or not to appeal (they have 90 days)? You can hear the chorus now – “Pick me! Pick me!” Most believe the Obama Administration will win this leg of the race (rare to turn down an Administration petition). Who will reach the finish line first? Well, that is the topic of another blog.

- Eva Stahl, Policy Analyst

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The Insider: The Politics of State Flexibility

Monday, March 7th, 2011

What’s behind the President’s embrace of state flexibility?
President Obama surprised a lot of people, including, apparently, Congressional Democrats, when he came out in favor of moving up the date when states could seek “global waivers” under the Affordable Care Act to craft their own health policy solutions. The waiver provision in the ACA, which would let states opt out of the Individual Responsibility Requirement (IRR), the Exchange and other provisions of the law as long as they can provide coverage that is equally comprehensive, equally affordable and doesn’t add to the federal deficit, goes into effect in 2017. The President announced his support for moving that date up to 2014. Republicans lost no time in trashing the President’s announcement. At the same time, there was conspicuous silence from Congressional Democrats, suggesting there is little chance a waiver date change could move through Congress.

There are also some technical challenges to implementing a waiver in advance of establishing any baseline for coverage or spending, but the President’s support for changing the date should be viewed through a political rather than policy lens. It was more designed to change the conversation about health care reform than to change policy.

Republicans have generally concentrated their fire against the means in the ACA rather than the ends. By declaring his support for greater flexibility over the means, President Obama is challenging Republicans to come up with an alternative that will work as well as the ACA or, failing that, forcing them to admit that they do not support comprehensive affordable coverage for all Americans.

Support for greater state flexibility also creates some daylight between the President and the IRR, which is probably the least popular provision in the ACA. At the same time, it creates some tension between Congressional Republicans and Republican governors. While the governors have been largely on board with the Congressional repeal strategy, if push comes to shove and they really do have to implement the ACA, they’d rather have more flexibility. For Congressional Republicans, however, any move to “fix” the ACA would blunt their attack messages and so must be rejected out of hand.

Since there is no sign that Democrats in either branch are interested in pursuing the idea, “state flexibility” could be a one-day blip in the 24/7 news cycle, but don’t be surprised to see it return as a talking point as the Presidential election gets closer.

That Settles That (for the moment)
For all those wondering whether Judge Vinson’s ruling that the entire ACA must be struck down because the IRR is unconstitutional halts implementation of the law pending appeal, the answer came down last week—it doesn’t. However, in an effort to speed final resolution, the Judge demanded that the Justice Department speed its appeal to either the 11th circuit or directly to the Supreme Court. The main effect of the judge’s ruling is that is should tamp down state resistance to implementation. For a scary look at the legal reasoning that underpins the challenges to the ACA and the consequences if that reasoning was widely applied, check out this issue brief by Simon Lazarus at the American Constitutional Society for Law and Policy.

Good news for beneficiaries/ bad news for millionaires
New poll results show the American people do not want to see cuts to Medicare and Medicaid and generally do not believe that such cuts are necessary. In fact, cutting Medicare and Medicaid are among the least popular options for dealing with the budget deficit. Most popular approaches are raising taxes on the wealthy, eliminating unnecessary weapons systems and reducing tax subsidies for the oil industry.

– Michael Miller, Policy Director

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The Insider: (Budget) Love Don’t Come Easy

Tuesday, February 15th, 2011

Legal Scene: You Can’t Hurry Love
Although VA Attorney General Cucinelli is seeking expedited review of the case against the Individual Responsibility Requirement (IRR), most court-watchers think this is unlikely to happen. The Supremes rarely reach down to bypass lower courts and do so even more rarely if the Justice Department opposes the move (which in this case it does). Meanwhile “guess how they’ll vote” remains an active pastime. For those who like to back up their speculation with a little cash, the online futures market is predicting that the IRR will be found constitutional (about a 70 percent chance) in light trading.

Want to do something more useful than speculating or gambling? Go out and educate people on the benefits of the ACA. The court won’t make its decision in a vacuum and what people think, matters.

You may be recused
When the SCOTUS finally does get the case, how many justices will actually hear it? Legislators on both sides of the aisle are already battling over this. Orrin Hatch is demanding Elena Kagan recuse herself because when she was Soliciter General, she had taken part in discussions of the ACA within the administration. Democrats are countering with a demand that Clarence Thomas recuse himself because of his wife’s political activities in opposition to the ACA.

Meanwhile, some Democrats in the Senate are not waiting for the Court ruling on the IRR, they are going out and seeking alternatives. This is a misguided effort. First, from a policy perspective, the alternatives will work less well. Perhaps, more importantly, the search for an alternative presumes that a consensus can be built within Congress for constructive modifications when in fact no such consensus is possible. The goal of the current Republican leadership is to bury the ACA, not to modify it.

There are slasher films and then there are slasher films
Remember that movie last year about the guy who was trapped while hiking and had to amputate his own arm in order to stay alive? That seems like a good metaphor for the Obama budget — it’s nasty and painful. But it’s better than the alternative if the proposals from House Republicans for the remainder of FY 2011 are any guide — $1.3 billion cut to community health centers and elimination of all funding for the national health service corps, which provides funding for doctors to work in underserved communities — the political equivalent of the Texas Chainsaw Massacre.

The U.S. economy has yet to really emerge from the worst economic crisis since the Great Depression. Although there are some signs of improvement, there are also many signs of continuing weakness, including in the housing market. With state and local job cuts already a drain on the economy, and more public employee cuts on the horizon in the next state fiscal year, it is premature to be contracting federal spending. While some commentators are making this point, it seems to have little traction on Capitol Hill where the main debate is between the President and his critics on the right. As a result, the budget debate appears to be shaping up as a rerun of the debate on the expiring Bush tax giveaways, and we already know how that movie ended.

Does the public support cuts?
In pursuing spending cuts, aren’t politicians just responding to the demands of their constituents? That’s a hard question. As with questions about health reform, it depends on how you ask. In general, the public seems to prefer the abstract idea of cuts over taxes, but is much less willing to embrace specific spending reductions.

Meanwhile, advocates for programs across the federal budget are rallying around their specific area of concern. This is understandable, but the moment seems to require a broader approach. Arguments that accept the basic premise that spending on human needs must be reduced but posit that somebody else should be cut increase the chance of a food fight over a shrinking pie. For an alternative approach, check out the good work being done by the folks at the Coalition for Human Needs There’s still time to sign on to their statement on budget priorities.

What does it all mean for health care activists?
The approach being pursued by Congressional Republicans is clearly a health care disaster. President Obama’s budget is more of a mixed bag. Although there are some good proposals to reduce health care spending — such as eliminating the ability of drug companies to pay generic drug firms to delay market entry (“pay-for-delay”) — there are also some painful reductions. Most troubling is a proposal to reduce the ability of states to use provider taxes to help fund their Medicaid budgets. While the proposed reduction in allowable taxes, from 6 percent in FY2014 to 3.5 percent in FY2017 and beyond, does not start phasing in until 2015, there are two likely effects. First, it will likely have a chilling effect on states that might be considering these taxes to help balance their budgets in the short run, making cuts in benefits more likely. Second, it will force states to find alternative revenue sources at roughly the same time they are expanding eligibility under the ACA, adding substantive and political challenges to implementation. In general, our view is that the federal government should be doing more, not less to help finance the Medicaid program.

Still, for the most part, the President’s budget spares health care programs from serious harm. But we shouldn’t rest easy. The debate in Congress is sure to be difficult and health care will not emerge unscathed. As difficult as the current budget moment may seem, it is likely that even greater challenges lie ahead when the focus of debate moves from FY2012 to long term debt reduction, which will put health care squarely in the spotlight.

– Michael Miller, Policy Director

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A Closer Look at the Florida Ruling

Wednesday, February 2nd, 2011

Vinson toasts anti-ACA supporters with tea
Alas, the Judge Roger Vinson (Florida v. HHS) ruling is here. The Florida-led case remains the media darling of the handful of cases challenging health reform that are rolling through the Federal courts in various circuits across the country. The Florida-led plaintiff list (those opposing the law) brags of 26 states; this case represents a larger Republican strategy to challenge the almost year old health reform law. The plaintiffs argue that the individual mandate (or the provision that all individuals hold health insurance by 2014 and also termed the minimum coverage provision) infringes upon individual liberty. No one should make you buy health insurance – alternatively, the Department of Justice (DOJ) argues that no one should make you pay for those who decide not to buy health insurance. Confused? We are just getting started.

Sit back and let your tea brew…
Many have waited anxiously for this moment even though there was little doubt regarding the outcome. Judge Vinson did, however, jolt the media with his far right leaning, tea bag dipping, and Constitution defending language: “it is not hyperbolizing to suggest that Congress could do almost anything it wanted. It is difficult to imagine that a nation which began, at least in part, as the result of opposition to a British mandate giving the East India Company a monopoly and imposing a nominal tax on all tea sold in America would have set out to create a government with the power to force people to buy tea in the first place.”

Vinson’s stance is most striking because of his position on what is termed ‘severability’; in other words, can the ACA stand without the individual mandate? Vinson maintains that while he did not read the entire Affordable Care Act (ACA) (no fair, we did), that it is clear to him that the individual mandate is inextricably linked to the provisions of the ACA and was the intent of Congress. Therefore, the entire law must be declared unconstitutional because it cannot exist without the individual mandate (and the individual mandate is unconstitutional).

Good news?
On that front, there remain questions about implementation and the responsibilities of states. Did the Judge grant an injunction? (No.) Do states need to implement the law? (Yes.) Will DOJ appeal to the 11th circuit? (Yes.) Various legal minds are trying to sort through these questions – however, the current analyses suggest that because Vinson issued a declaratory judgment, there is no need for a ‘stay’ – or a requirement that until the appeals process is complete, the law stays put on the books. That is not to say that states won’t think this their ‘out’ – advocates must continue to educate the public about the benefits of the law and move forward with implementation. Jonathan Cohn does his best to summarize this confusing outcome here.

In short, states are not off the hook. The ACA is still the law of the land and unless SCOTUS rules otherwise, our work continues. It is important to remember that as the public reaps the benefits of the law, they will embrace it. This will give SCOTUS pause; overturning ACA will be damaging to all Americans. It is our job to remind the public of a state’s need to continue to work to insure millions of Americans, giving them greater access to health care and better health.

Few commentators are touting the win for Medicaid as a result of this ruling. Judge Vinson did tell the right wing to back off of Medicaid – he maintains that there is no legal foundation to their argument that states are being coerced into the program. This is encouraging news for advocates who are working tirelessly to protect a vital program for vulnerable populations.

Keep the context.
The ruling differs from that of Judge Henry Hudson (Virginia v. Sebelius) issued this past December.  Hudson did not go as far as Vinson in his ruling – although Hudson claims that the individual mandate is unconstitutional, he does not maintain that the entire law is null and void. It is important to put all of this into context. These are two rulings of four – the two opposed to the ACA are both from Republican appointed judges in more right leaning circuits (yes, this is part of a Republican strategy as to where they filed cases) while the two rulings in support of the ACA come from Democratic appointed judges – and judges have thrown out 12 cases due to a lack of merit. So, the rulings scoreboard reads 2-2 and we are not even to the seventh inning stretch.

Therefore, the most important ‘take away’ from Vinson is that this is one piece of a larger judicial process – more rulings will be unveiled before the Supreme Court makes its determination regarding the constitutionality of the ACA. However, as pointed out by our own Michael Miller, the ruling is fodder for Republicans to feed their far right base and motivate newly reddened states to hold defiant in their progress toward ACA implementation.

Just roll with it.
What’s next? The 4th circuit. The two Virginia cases will be heard by the same appeals panel (three judges selected at random). While DOJ will appeal in the 11th circuit, the 4th circuit will most probably have the privilege of issuing the first appeals ruling regarding the individual mandate.

– Eva Marie Stahl, Policy Analyst

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The Insider: ACA Implementation: Partly sunny with a (Supreme) chance of rain

Thursday, October 21st, 2010

This week brought some important developments in ACA implementation. First and foremost is the major win by consumer advocates in the prolonged and multi-pronged struggle to shape NAIC recommendations on Medical Loss Ratios. At the NAIC meeting in Orlando today, consumer advocates beat back attempts by brokers to exclude commissions from the definition of medical expenses, blocked insurers from using high-loss ratios in one state to paper over a failure to meet standards in another, and created a reasonable standard of certainty to establish whether an insurer’s failure to meet the loss ratio was due to under-spending on medical care or unforeseeable random events.

These decisive wins are a case example of the one-two punch that advocates will need in order to influence the numerous federal and state decisions ahead. The consumer victory resulted from the combination of persistent policy advocacy, especially by the NAIC consumer representatives, coupled with a national effort by consumers to reach out to their insurance commissioners and let them know that people were watching (illustrating one of the important axioms of grassroots advocacy: decision makers make different — and better — decisions when they are being watched).

The second key development, while less positive, also contains within it an important strategic dimension. Last week, the Florida District Court issued a decision allowing the case against the individual responsibility clause of the ACA to go forward. Specifically, the Florida court will hear arguments about whether the individual responsibility requirement is legal under the Commerce Clause. The court also will hear arguments about whether the Medicaid expansion under the ACA exceeds Congress’ authority, although Judge Vinson’s decision makes it clear that he considers this argument to be much weaker than the individual responsibility claim. Because Judge Vinson rejected the federal government’s argument that the penalty for not having health insurance constitutes a tax, the focus of the Florida case is squarely on the Commerce Clause argument. Just a week earlier, a District Court in Michigan ruled that the individual responsibility requirement was Constitutional. Whether Florida (and Virginia) ultimately agree with the Michigan ruling, the issue is likely heading for the Supreme Court, which should be enough to give anyone concerned about the sustainability of the ACA a few sleepless nights (especially since the wife of one Justice is actively campaigning for repeal).

But while legal scholars slug it out and try to second guess the next round of rulings, it is important for advocates not to lose sight of the intertwining of the political and legal issues since most advocates will not be able to intervene directly in the legal proceeding.

First, the court cases keep public attention focused on the individual responsibility requirement, which is one of the least popular provisions of the law. The lawsuits also encourage doubt over whether the law will actually be implemented in its current form and potentially give cover for foot-dragging by state administrations inclined to oppose implementation.

The court actions not only affect the political debate, they are also affected by it. The political backdrop against which the Supreme Court makes its final decision is extremely important. To the extent that the law is considered unpopular and there is an active movement for roll back, it will create a context in which a negative legal outcome is considered more palatable.

The key takeaway for supporters of reform is that whether we are looking at how the court cases affect the political debate or how the political debate affects the courts, the response of advocates must be to keep working to create a context of support for the law and expectation that it should and will move forward.

Overall, the events of the past week underscore both the need for and the potential of sustained consumer engagement.

— Michael Miller, Policy Director

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Cross Post: A deeper look at health reform’s individual responsibility requirement

Thursday, July 15th, 2010

Community Catalyst recently worked with our partner, Georgetown University’s Center for Children and Families, to create a document answering prevalent questions about how the new mandate for insurance coverage will affect families. Here’s an excerpt from the Center for Children and Families’ blog post on the resource:

“With all of the controversy and rhetoric surrounding the requirement, it seemed a good time to take an objective, detailed look at how it will actually work.

“Plus, even though it doesn’t go into effect until 2014, we wanted to write about the individual responsibility requirement because it is the foundation on which much of health reform rests.  It allows the country to move forward with popular insurance reforms, such as the ban on excluding people from coverage if they are sick, and plays a major role in expanding coverage.”

Read the rest of the post that cites some of the themes that arose while working on the Q&A at “Say Ahhh! A Children’s Health Policy Blog,” or read the resource on our website.

– Katherine Howitt, policy analyst

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