http://online.wsj.com/article/SB10001424052702304707604577422923531419782.html
http://www.slate.com/articles/news_and_politics/jurisprudence/2012/03/supreme_court_and_obamacare_what_donald_verrilli_should_have_said_to_the_court_s_conservative_justices_.html
The Obamacare Scoreboard to Date. Despite the tsunami of litigation, which crashed onto the steps of the Supreme Court in March, the Affordable Healthcare Act’s many provisions have been --- bit by bit --- taking effect, since the statute was first signed in 2010. The following scoreboard is extracted from the Henry J. Kaiser Family Foundation’s “Health Reform Source” website:
In 2010, according to Kaiser, 26 provisions took effect, most notably
- An increase in the Medicaid drug rebate;
- Medicaid coverage for childless adults, whose income was up to 133% of the poverty level;
- A federal pre-existing-condition insurance plan;
- Adult dependent coverage to age 26;
- New consumer protections involving health insurance policies.
In 2011, 17 of 20 provisions took hold. These included
- The first round of grants from the Department of Health and Human Services to encourage and assist states in the establishment of health insurance exchanges (enrollment in exchanges is supposed to begin in 2014);
- Closing of the so-called “donut-hole” in prescription-drug benefits for Medicare recipients.
Provisions that didn’t hit the ground, which were supposed to last year, included
- Grants to establish wellness programs (these were held off for year);
- Medical-malpractice grants (intended to pilot projects to test tort-litigation alternatives, these grants were pushed back a year as well).
[Accessed at http://healthreform.kff.org/Timeline.aspx]
What’s on Tap for 2012?
Eleven items were scheduled for 2012. According to Kaiser, nine are actually now in effect or are poised to take effect on schedule.
- Uniform coverage summaries for consumers: The idea is that all applicants and enrollees should receive the same sort of comprehensible information from all providers, so that the buyer can easily figure out what s/he’s getting. HHS issued final regulations on February 9th to take effect September 23rd.
- Rebates to Medicare Advantage Plans were reduced, per a letter from the Centers for Medicare and Medicaid Services on February 28th.
- Accountable Care Organizations are permitted to share cost savings they achieve for the Medicare program.
- A Medicare “Independence at Home” demonstration project was launched using “physician and nurse practitioner directed home-based primary care teams,” according to the Centers for Medicare and Medicaid Services.
- On February 2nd, the Centers issues final rule on fraud and abuse prevention initiatives under Medicare, Medicaid and CHIP.
- Annual fees on the pharmaceutical industry went into effect on January 1st, per IRS regulations issued last August. [26 CFR Parts 51 and 602]
- A value-based purchasing program was launched under Medicare, aimed at paying hospitals according on quality measures is set to take effect in October.
- Also intended for October are reduced payments to hospitals for readmission under Medicare.
Meanwhile, The Department of Labor’s Employee Benefits Security Administration recently issued it Form M-1 for 2011. Multiple Employer Welfare Arrangements are required to file the form annually to demonstrate compliance with the Health Insurance Portability and Accountability Act. The 2011 Form M-1 contains revisions reflecting requirements of the Affordable Care Act. Consequently, the filing deadline has been extended from March 1st to May 1st. [See http://www.mondaq.com/unitedstates/x/165690/Employee+Benefits+Compensation/Employee+Benefits+Update+February+2012]
The Courts Also Remain Quite Active.
Lest any of us naively imagine that litigation involving Obamacare is on hold, pending the Supreme Court’s pronouncements on the act’s constitutionality, put that silly notion aside. Herewith is a sample of current litigation implicating provisions of the Affordable Care Act:
- John B. v. Emkes, 2012 WL 481880 (U.S.D.Ct., M.D.Tenn., February 14, 2012)
Facts. This decision is just the latest episode in a 14-year-old drama launched by a consent decree. In this class-action challenge to Tennessee's managed care program, TennCare, the plaintiffs allege that the defendants, Tennessee officials charged with implementing TennCare, failed to provide early and periodic screening, diagnosis and treatment (“EPSDT”) services to Tennessee children (ages 21 and under) covered by TennCare, in violation of the Medicaid Act. Shortly after the lawsuit was filed in early 1998, the parties jointly filed a Consent Decree (ECF No. 12) under which they have been operating, and sporadically litigating, throughout the nearly fourteen years since its entry. In this chapter of the lengthy litigation drama, the defendants have asked the district court to vacate portions of the degree and dismiss the suit because the issues at hand are not amenable to individual enforcement.
In making this argument they relied on Sixth Circuit precedent directly involving them. More specifically, the Sixth Circuit earlier rejected the defendants' argument that the Medicaid statute as a whole does not confer individual rights enforceable under 42 U.S.C. § 1983 but, in addressing their more particularized arguments aimed at “the primary statutory provision on which the consent decree and plaintiffs' claims are based,” reconfirmed that 42 U.S.C. § 1396a(a)(30) is not privately enforceable under § 1983. Consequently, the court vacated “the consent decree's requirement that defendants ensure that the availability of services is geographically comparable and any other provisions based on § 1396a(a)(30),” without specifying exactly which other provisions of the consent decree might be based on § 1396a(a)(30). Likewise, the court expressly held that the Adoption Assistance Act (“AAA”), 42 U.S.C. §§ 671(a) (16), 675(1), and 675(5), does not create rights that are privately enforceable under § 1983, but declined to “ascertain the extent to which the decree is based on provisions of the [AAA],” leaving that issue to be resolved in the first instance by the district court.
Decision. In deciding this question, the district judge first felt compelled to determine whether Tennessee was required to provide the services at issue, and not merely pay the bills for them. In making this determination, His Honor had recourse to Obamacare.
Congress has recently clarified, however, that the term “medical assistance” means “payment of part of all of the costs of ... care and services, or the care and services themselves, or both.” 125 Stat. 119, at § 2304 (March 23, 2010) (“Patient Protection and Affordable Care Act” (amending Section 1905(A) of the Social Security Act as codified at 42 U.S.C. § 1396d(a)). Under this amendment, whether a particular provision of the Medicaid Act requires payment for services or the provision of the services themselves is not controlled by the old definition of “medical assistance” as referring only to financial assistance. Indeed, the legislative history behind this amendment clearly shows that Congress intended to clarify that where the Medicaid Act refers to the provision of services, a participating State is required to provide (or ensure the provision of) services, not merely to pay for them:
[“Medical assistance”] is expressly defined to refer to payment but has generally been understood to refer to both the funds provided to pay for care and services and to the care and services themselves.... Some recent court opinions have, however, questioned the longstanding practice of using the term “medical assistance” to refer to both the payment for services and the provision of the services themselves. These opinions have read the term to refer only to payment; this reading makes some aspects of the rest of Title XIX difficult and, in at least one case, absurd. If the term meant only payments, the statutory requirement that medical assistance be furnished with reasonable promptness “to all eligible individuals” in a system in which virtually no beneficiaries receive direct payments from the state or federal governments would be nearly incomprehensible.
[ H.R.Rep. No. 299, 111th Cong., 1st Sess.2009, at 645–50 (Oct. 14, 2009), also available at 2009 WL 3321420, at *694–*95. ]
Judge Wiseman then concludes, “In sum, the Court finds that 42 U.S.C. § 1396a(a)(43)(B) and (C), along with subparagraph (A), create rights that are individually enforceable under 42 U.S.C. § 1983, and that the scope of those rights is not affected by the Sixth Circuit's holding in Westside Mothers II or John B. v. Goetz. Based on those conclusions, the Court further finds that the paragraphs of the Consent Decree that rely upon the presumption that subparagraphs (A) through (C) create individually enforceable rights are themselves enforceable as a matter of law.”
In a number of other recently reported decisions, it’s likely that the Affordable Care Act would have affected the outcome, but for the fact that the Supreme Court early on declared that the act is not retroactive. [Schindler Elevator Corp. v. United States, 131 S.Ct. 1885 (2011); Graham County Soil and Water Conservation District v. U.S. ex rel Wilson, 130 S.Ct. 1396 (2010).]
- U.S. ex rel. Sonnier v. Allstate Insurance Company, 2012 WL 75041 (U.S.D.Ct., M.D.La., January 10, 2012)(a False Claims Act case)
- United States v. ITT Educational Services, Inc., 2012 WL 266943 (U.S.D.Ct., S.D.Ind., January 30, 2012)(also a False Claims Act case)
- United States ex rel. Rille v. Sun Microsystems, Inc., 2012 WL 260755 (U.S.D.Ct., E.D.Ark., January 30, 2012)(yet another False Claims Act case).
Author’s comment. First of all, you may be asking, What’s Obamacare got to do with the False Claims Act. Several responses leap immediately to mind. The Affordable Care Act is so enormous that one might find almost anything in there. Some have wondered if any of those who passed or signed it ever read it all.
Second, more seriously, an ACA concern certainly is controlling healthcare costs, as amply illustrated by several of the provisions I listed above as having gone or soon to go into effect.
Finally, and more precisely, the following changes to the FCA were made by the ACA:
- The ACA amended the FCA to allow Uncle Sam the final word may dismiss a case grounded upon a public disclosure. With respect to qui tam actions initiated by private citizens alleging fraud against the government by a federal contractor or recipient of federal funds, the rule used to be that “the court shall dismiss an action unless opposed by the Government, if substantially the same allegations or transaction alleges in the action or claim were publicly disclosed.” [31 USC 3730(e)(4)(A)
- This so-called “public disclosure” bar to a qui tam action will now ordinarily fall down if the plaintiff is the original source of the fraud allegations.
- Failure of a Medicare or Medicaid recipient to report and return an overpayment within 60 days of discovery will expose that recipient to potential FCA liability.
- Per the ACA, any claims brought under the Anti-Kickback Act [42 USC 1320a-7b(b)] are now automatically also FCA claims.
Quo vadis? So, where are we left in April 2012? As you might imagine, every pundit in America has his/her crystal ball polished to a fine glow. Here are a few prognostications for whatever they may be worth:
Consider: why would a politician force unwilling Catholics (and others) to pay for services they consider patently immoral...and with no co-pay?! When was the last time you saw something covered in a health plan with no co-pay? Ask yourself: why would a politician risk making an already unpopular health care plan more unpopular by immediately validating everyone's worst fears about federal "overreach" in its first years by mandating services that everyone in the country knows are likely to be not only the most controversial, but more to the point, the most uncompromisingly unacceptable to a very large group of people in the country?... The calculation is that too few people will want to enter into the nationalized health care pool and that it will have too little money to cover them. What to do? Is there a ready source of cash and of potential clients who can be forced to join the system without appearing to force them to join the system? Yes, there is. Catholic health care is the largest in the nation. Where better to go for potential customers for your nationalized health care plan? But how do you get them into your system rather than staying in theirs? Easy. Require the plans to do something they can't in good conscience do. They will then have to dissolve themselves and hand over their assets and members to you, or else look like hypocrites for acting against what they insisted, just weeks before, was a rock-solid principle of conscience.
[Randall Smith, “Beware the Obamacare Win-Win,” American Thinker, March 3, 2012, accessed at http://www.americanthinker.com/2012/02/beware_the_obamacare_win-win.html]
· When Democrats made the final push to pass ObamaCare, part of the case they made to wavering legislators was that even though polls showed the law as unpopular at the time, public opinion would eventually come around. A while back, Politico collected a handful of examples of this sort of optimism: As early as August of 2009—the month that opposition to the law started to generate big headline—former president Bill Clinton could be found making the case that the law's popularity would go up "the minute the president signs" the bill. Obama pollster predicted that not only would Americans come to like the law, Republicans would be the ones to face negative political consequences. A White House, communications aide, meanwhile, promised The New York Times that Democrats would run "aggressively" on the law. As it turns out, in his final State of the Union speech before the 2012 election, Obama barely mentioned the health care overhaul. And the poll numbers have yet to turn in its favor. Via a new USA Today poll, a majority of voters support repealing the law, and it may be hurting the president in key contested election states like Ohio, Florida, Colorado, and Michigan….
[Peter Suderman, “Will ObamaCare Hurt Democrats in 2012?” Reason, March 2, 2012, accessed at http://reason.com/blog/2012/03/02/will-obamacare-hurt-democrats-in-2012]
· If the law is upheld as constitutional, it would be an utter disaster for advocates of small government. If Congress can force Americans to purchase a product they do not want, it would mean that there are effectively no limits on congressional power. But as much as it would be an affront to individual liberty, it would probably be a big boost to Republicans in both the presidential and congressional elections. Though, on the one hand, Obama would get to claim vindication if the Supreme Court upheld the law, the backlash against the verdict would be fierce, not only among conservatives, but among independents who overwhelmingly oppose the law’s requirement that individuals purchase health insurance. Last month, 67 percent of Americans had an unfavorable view of the mandate, compared with just 30 percent who had a favorable view, according to a survey by the Kaiser Family Foundation. The same poll found that by a more than three-to-one margin (54 percent to 17 percent), Americans believe the Supreme Court should strike down the mandate. A Supreme Court verdict upholding Obamacare would be the one thing that could galvanize conservative grass-roots activists who have been underwhelmed by the weak GOP presidential field.
[Phillip Klein, “Obamacare decision will reshuffle political deck,” The Examiner, February 22, 2012, accessed at http://campaign2012.washingtonexaminer.com/article/supreme-court’s-obamacare-decision-will-reshuffle/390546]
FOR COMPREHENSIVE COVERAGE OF THE DECISION, WHEN IT IS RELEASED, SEE MY "COMPENSATION & BENEFITS LAW BULLETIN" IN JULY:
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