HealthLawProf Blog

Hobby Lobby Fall Out

For those who feared that the Supreme Court’s Hobby Lobby decision would open the door for employers to block contraceptive access for women in the workplace, welcome reassurance has come this week from the U.S. Court of Appeals for the Fifth Circuit. According to the Fifth Circuit, when the Affordable Care Act requires that contraception coverage be available for workers at religiously-affiliated institutions, the Act also accommodates the scruples of employers who have religiously-based objections to contraceptive use.

As the Fifth Circuit observed, employers with religious objections to contraception can shift the responsibility for coverage to their insurers or the federal government. Hence, there is no unlawful burden on those employers from the mandate that health care plans cover the costs of contraception.

Of course, the decision was rendered by a panel of three judges rather than the full court, and the panel included two judges appointed by Democratic presidents. But the third judge, Jerry Smith, who wrote the opinion and was appointed by President Reagan, is a staunch conservative who has not been sympathetic to reproductive rights in other cases.

If this case is an accurate guide, it may well turn out that the Hobby Lobby Court was correct when it observed that its decision recognized the interests of both employers and employees.

[cross-posted Bill of Health, orentlicher.tumblr.com]

King vs. Burwell: Supreme Court Upholds Obamacare Tax Subsidies

Today, in King v. Burwell, the Supreme Court upheld a key provision of the Affordable Care Act, handing a major victory to the Obama administration. The decision was 6-3, with Chief Justice John Roberts delivering the court's majority opinion. Roberts and Justice Anthony Kennedy joined the court's liberals. 

As co-blogger Davis Orentlicher explained: "the challengers cite to two lines in the Affordable Care Act (ACA) that authorize subsidies for insurance bought on state-operated health insurance exchanges, without mentioning federally-operated state exchanges. Hence, argue the challengers, subsidies should be provided only for insurance purchased on state-operated exchanges, which means in only about 1/3 of states."

The Court disagreed with the challengers. In its syllabus the Court explained that 

[w]hen analyzing an agency’s interpretation of a statute, this Court often applies the two-step framework announced in Chevron, 467 U. S. 837. But Chevron does not provide the appropriate framework here. The tax credits are one of the Act’s key reforms and whether they are available on Federal Exchanges is a question of deep “economic and political significance”; had Congress wished to assign that question to an agency, it surely would have done so expressly. And it is especially unlikely that Congress would have delegated this decision to the IRS, which has no expertise in crafting health insurance policy of this sort. It is instead the Court’s task to determine the correct reading of Section 36B. If the statutory language is plain, the Court must enforce it according to its terms. But oftentimes the meaning—or ambiguity—of certain words or phrases may only become evident when placed in context. So when deciding whether the language is plain, the Court must read the words “in their context and with a view to their place in the overall statutory scheme.”

***

Petitioners’ plain-meaning arguments are strong, but the Act’s context and structure compel the conclusion that Section 36B allows tax credits for insurance purchased on any Exchange created under the Act. Those credits are necessary for the Federal Exchanges to function like their State Exchange counterparts, and to avoid the type of calamitous result that Congress plainly meant to avoid. 

759 F. 3d 358, affirmed.

Bottom line: Individuals who get their health insurance through exchange established by federal government will be eligible for tax subsidies.

Affordable Care, the Supreme Court, and the Wisdom of Crowds

How will the Supreme Court rule on the challenge to the Affordable Care Act’s subsidies that help millions of lower- and middle-income Americans afford their health care coverage? According to FantasySCOTUS’s court watchers, who have correctly predicted more than 70 percent of Supreme Court decisions so far this year, Obamacare should remain intact.

This result is not surprising. The arguments in favor of the government are much stronger than are those for the challenger. To be sure, the challengers cite to two lines in the Affordable Care Act (ACA) that authorize subsidies for insurance bought on state-operated health insurance exchanges, without mentioning federally-operated state exchanges. Hence, argue the challengers, subsidies should be provided only for insurance purchased on state-operated exchanges, which means in only about 1/3 of states. But other language in ACA indicates that the subsidies are available for insurance purchased on all exchanges. When a statute’s language is ambiguous and there are reasonable alternative interpretations, courts are supposed to defer to the executive branch’s interpretation, not substitute their own interpretation.

And if one looks beyond the specific references to the subsidies to the broader context of ACA and the intent of Congress, it becomes even clearer that the subsidies should stand. Several other sections of ACA assume that subsidies are available on all exchanges, as did members of Congress when they passed the law. Indeed, it wasn’t until nine months after ACA was passed that anyone noticed the language in the bill suggesting that subsidies might be available only on state-operated exchanges.

Of course, these arguments have not persuaded all federal judges, and they are not expected to have persuaded at least three Supreme Court justices. But if precedent prevails, ACA will survive its latest challenge.

[cross-posted Bill of Health and orentlicher.tumblr.com]

Congress, too, is mystified by long-delayed Equal Access regs

Members of the House Committee on Energy and Commerce and the Senate Committee on Finance sent a letter today to Secretary Burwell, urging HHS to issue the Equal Access regulations that have been in limbo since 2011.  This is an important and much-needed call for action in the wake of Armstrong v. Exceptional Child Center, which shut down private rights of action for Medicaid providers seeking fair reimbursement from states in federal courts.  The letter explicitly recognizes the harm that the Court's recent decision will inflict on the Medicaid program, which I've written about on this blog (most recently here) in the context of both Armstrong and Douglas v. Independent Living Center.  

Though the draft regulations were not perfect, and in fact would benefit from putting some real teeth into HHS's review of states' payment decisions on equal access to care for Medicaid beneficiaries, they would at least ensure that HHS is actively overseeing states' payment rate decisions.  Currently, states are able to change rates with very little intervention from HHS, which often involves decreasing payment rates to balance state budgets.  Now that the Court has tasked HHS with enforcing the equal access provision, rather than the providers who HHS admittedly relied on to raise flags about states' low payment rates, HHS must complete the draft regulations.  Perhaps this direct plea from members of key committees will refocus HHS's attention on these important regulations.

Frozen Embryo Disputes and Unwanted Parenthood

For the second time, a state court of appeals has given a woman permission to use frozen embryos over the objections of her former partner who supplied the sperm. In both cases, the new one from Illinois, the previous one from Pennsylvania, cancer chemotherapy left the women infertile and therefore unable to create new embryos with another man.

The results seem reasonable. As a general matter, courts have not been willing to impose unwanted parenthood on people who participate in the creation of frozen embryos via in vitro fertilization (IVF). However, when the frozen embryos provide the only chance for one of the embryo creators to have a genetically-related child, the desire of one person to have a child can trump the desire of the other person not to have a child.

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