Today, the United States Supreme Court addressed the constitutionality of two provisions in the Patient Protection and Affordable Care Act (ACA): (1) the “individual mandate”, and (2) the expansion of Medicaid and corresponding federal funding.
The Court held that the individual mandate is constitutional, but the Medicaid expansion provision is in part unconstitutional and, therefore, the Government may withhold new, additional funds, but not existing funds, from a state that fails to comply with the ACA’s Medicaid expansion requirements. Beyond the Medicaid expansion provision, the Court’s decision leaves the ACA, including all provisions applicable to insurers and health plans, fully intact.
Below are the issues the Court heard followed by the majority decision on each issue.
Issue 1: Is the individual mandate constitutional?
Decision 1: Yes. The individual mandate may be upheld within Congress’s power under the Taxing Clause, not the Commerce Clause, of the Constitution.
Issue 2: Can Congress require states to expand Medicaid eligibility as a condition of receiving any federal funding for their existing Medicaid program?
Decision 2: No, the Government may not withdraw existing Medicaid funds for failure to comply with the requirements set out in the Medicaid expansion provision of the ACA, but may withhold additional funding designated solely for the expansion.
Issue 3: Does the holding affect other provisions of the Affordable Care Act (a.k.a. the “severability” issue)?
Decision 3: No. The rest of the Act remains intact.
Issue 4: Is suit barred at this time by the Tax Anti-Injunction Act?
Decision 4: No. The Affordable Care Act does not require that the penalty for failing to comply with the individual mandate be treated as a tax for purposes of the Anti-Injunction Act. The Anti-Injunction Act therefore does not apply to this suit.
CoreSource will continue to support its clients’ compliance implementation efforts, given the ACA provisions will remain in force.
In addition, CoreSource remains very active in the Benefits Administration industry and serves on the Board of the Self Insurance Institute of America. This association actively engages state and federal legislators to ensure its member clients’ interests regarding self-insured health plans are well represented.
CoreSource along with SIIA have strongly supported the positions of our self-insured clients and will continue those efforts to strive for the best regulatory and market environment for our clients and their members.
Please contact your CoreSource representative if you would like to further discuss your questions or how we can support you through the HealthCare reform requirements.