28 Sep Health Reform Law to Reach Supreme Court Next Year

FierceHealthcare | The Obama administration set the stage Monday for the Supreme Court to rule early next year on the constitutionality of the president’s healthcare law by declining to press for a full appeal in a lower court.

The Justice Department announced it will forgo an appeal to the full U.S. 11th Circuit Court of Appeals in Atlanta. Such an appeal to the 11-member court could have taken months and delayed a final decision from the high court until at least 2013.

In a 2-1 ruling in August, a panel of the 11th Circuit became the first appellate court to declare unconstitutional the new requirement that all Americans have health insurance.

Now, the administration can appeal directly to the Supreme Court and ask the justices to schedule the case to be heard and decided during the term that begins next week and ends in June. If the court follows that schedule, the justices will hand down a ruling on President Obama’s signature legislation just as the election campaign moves into high gear.

At issue for the court is whether Congress can use its power to “regulate commerce” to require that all Americans who have taxable income certify by 2014 that they have health insurance. If not, they must pay a tax penalty that begins at $95.

The two judges based in Atlanta concluded Congress had overstepped its power by regulating the behavior of persons who do not wish to buy insurance. This refusal to buy is not commerce, the judges said.

The administration’s lawyers say this requirement is a reasonable and necessary regulation to prevent freeloaders from taking advantage of the taxpayers. Under current law, hospitals must spend tens of billions of dollars each year to provide emergency care to persons who lack insurance or the ability to pay. The new healthcare law also requires insurers to offer coverage to persons who have preexisting medical conditions.

The ruling in Atlanta grew out of a lawsuit filed by Republican officials in 26 states and the National Federation of Independent Business. They also balked at the law’s requirement that states expand their Medicaidprogram of providing healthcare for low-income persons.

The business federation said it was pleased with Monday’s decision forgoing the drawn-out appeal in the lower court. “NFIB is excited that all indications point to the government going directly to the Supreme Court to hear our case and commends the administration on their decision,” said Karen Harned, executive director of the group’s legal center.

The justices may also want to consider a new issue that could delay a final ruling. This month, the U.S. 4th Circuit Court, based in Virginia, threw out a challenge to the healthcare law by citing a federal law that bars disgruntled taxpayers from going to court until they have paid the disputed tax and filed for a refund. Applying that rule, the judges said no court can rule on the constitutionality of the Affordable Care Act until after 2014, when the first taxpayer pays the penalty.

However, several other courts, including the 11th Circuit, said the penalty is not a “tax” and, therefore, is subject to challenge before it takes effect.

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