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The recent blockbuster decision of the U.S. Supreme Court on the Affordable Care Act means that, for associations and their members, it’s time for human resources directors or others responsible for employee benefits to evaluate if their insurance program provides adequate protection from inadvertent noncompliance. It’s also time to review prior efforts to understand the act to ensure compliance in upcoming years.
In National Federation of Independent Business v. Sebelius, the high court ruled that ACA is constitutional. Associations were at the forefront of this decision. The lead petitioner was NFIB, one of the nation’s leading voices for small businesses. NFIB’s involvement reflected the concern of its membership that small businesses will find it unduly difficult and costly to keep up with the act’s regulations and requirements.
The ruling is almost as complicated as the 1,000-page health law itself, but for most associations and their members, there is no immediate impact. The ruling does not change any effective dates or reforms affecting employers. Still, associations should have a basic understanding of what the ruling says. The following is a summary of its key parts.
The first issue was whether it is constitutional to require people to maintain “minimum essential” health insurance coverage or, starting in 2014, to pay a “penalty.” This requirement is known as the individual mandate. The second issue was the constitutionality of a Medicaid expansion.
Regarding the individual mandate, Chief Justice John Roberts voted with the four most conservative justices to declare it unconstitutional under the Commerce Clause. That issue was the dominant controversy during oral argument in March. Roberts then voted with the four most liberal justices to find the same provision a constitutional exercise of Congress’ powers to tax. With this vote, the act was upheld.
Throughout his decision, Roberts noted that the high court can only assess the constitutionality of legislation and cannot opine on the merits. Sometimes he made this point elegantly (“We do not consider whether the Act embodies sound policies. That judgment is entrusted to the Nation’s elected leaders.”); sometimes he did so aggressively:
“Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.”
Either way, the point is clear: Congress has enacted healthcare reform and the Supreme Court has affirmed its constitutionality. Unless something drastic happens, the Affordable Care Act is here to stay.
For Orin's complete report, click here.
Orin is managing partner of Anderson Kill & Olick, LLC, DC office. She represents policyholders, including employers, in the recovery of insurance coverage in the life/health and property/casualty arenas. Contact her at firstname.lastname@example.org.