Supreme Court Hears Challenges To Health Care Reform

Yesterday, the Supreme Court concluded three days of argument on challenges to the Patient Protection and Affordable Care Act (ACA). President Obama signed the ACA on March 23, 2010, and legal challenges to the landmark federal health care reform law arose almost immediately. The law has been challenged by states as well as individual citizens. Many of these challenges have focused on the minimum coverage requirements, generally known as the "individual mandate." The Court agreed to review a decision by the Eleventh Circuit holding the individual mandate unconstitutional, but is also considering many arguments not addressed by the Eleventh Circuit.

While the Court's findings will not likely be known for months, their impact will be felt by employers, health care providers, insurers, individuals and all others who have a stake in the path that federal health care reform follows. While the issues under consideration by the Court this week may appear discrete, they touch upon and are connected to many other provisions of the ACA. For the time being, unless and until the Supreme Court invalidates a provision of the law, the ACA remains in full force and effect. Employers and insurers should continue to comply with those provisions already in effect and should continue to plan for implementation of those provisions that take effect in 2013 and 2014.

The following is a digest of the issues being considered by the Supreme Court. For more in-depth analysis of and insights on the issues, please go to the Ropes & Gray Health Reform Resource Center, where some of our colleagues from our Appellate Litigation and Supreme Court practice offer their thoughts.

SUMMARY OF HEARINGS

Anti-Injunction Act

The first day of oral argument was devoted to whether the Supreme Court may rule on the constitutionality of the ACA now or whether it must wait until the minimum coverage provisions take effect and the payment for failure to comply is due. The ACA requires that individuals obtain minimum essential coverage, and those who do not will be subject to a penalty administered by the IRS. The Court is considering the application of the Anti-Injunction Act (AIA), which prohibits taxpayers from challenging a tax before they have paid it. The appellate courts in the Eleventh and Sixth Circuits found that the Anti-Injunction Act does not apply, but the Fourth Circuit found otherwise. For different reasons, both those defending and opposing the ACA agree that the AIA does not bar the Court from reaching a decision on the constitutionality of the mandate. To ensure that the question would be given due consideration, the Supreme Court appointed separate counsel to argue that the AIA does apply to the penalty under the ACA and therefore bars the Supreme Court from ruling on the merits.

Many of the questions...