Round Two for ACA?

Lib­erty Univer­sity case may put health re­form law be­fore high court again

Modern Healthcare - - THE WEEK IN HEALTHCARE - Joe Carl­son

The U.S. Supreme Court may hear Round Two of le­gal ar­gu­ments over the health­care re­form law as soon as late 2013, thanks to a re­vived con­sti­tu­tional chal­lenge pend­ing in Vir­ginia. The court late last year or­dered the 4th U.S. Cir­cuit Court of Ap­peals to re­open Lib­erty Univer­sity v. Gei­th­ner, a case that will pose broad First Amend­ment chal­lenges to re­cent HHS reg­u­la­tions on ac­cess to con­tra­cep­tion, as well as con­sti­tu­tional ar­gu­ments over the re­quire­ment that larger em­ploy­ers of­fer com­pre­hen­sive in­surance plans, in­clud­ing ser­vices and drugs to which they have re­li­gious ob­jec­tions.

When Lib­erty was or­dered re­opened last Novem­ber, ob­servers spec­u­lated the case would be lim­ited to a sin­gle nar­row ques­tion about the con­sti­tu­tion­al­ity of the so-called “em­ployer man­date” to pro­vide in­surance.

But lawyers say a re­cent or­der from the 4th Cir­cuit makes clear that the ap­peals judges are open­ing the door to a host of le­gal chal­lenges that hit a wide range of the most con­tro­ver­sial topics in the law. A lawyer for Lib­erty Univer­sity in Lynch­burg, Va., said the chal­lenges could strike at the heart of the fi­nan­cial mech­a­nisms of the 2010 law and com­pel the Supreme Court to de­cide again whether the law is con­sti­tu­tional.

The Supreme Court last June fa­mously up­held the re­form law’s re­quire­ment that nearly all Amer­i­cans pur­chase health in­surance, af­ter a 5-4 ma­jor­ity ruled the man­date was es­sen­tially a tax on peo­ple who don’t have cov­er­age. But some four dozen cases chal­leng­ing var­i­ous as­pects of the law are pend­ing in fed­eral courts across the coun­try, many fo­cused on reg­u­la­tions that HHS fi­nal­ized in 2012.

Mathew Staver, dean of the Lib­erty Univer­sity Law School and chair­man of the law firm rep­re­sent­ing the school, Lib­erty Coun­sel, said the case may present a short­cut to the high court for re­cent con­tro­ver­sies re­gard­ing re­li­gion and lin­ger­ing is­sues the court did not ad­dress last year, such as whether Congress has con­sti­tu­tional author­ity to or­der em­ploy­ers with more than 50 work­ers to of­fer health in­surance.

“We’re much fur­ther along than the other law­suits, and our case is a broader chal­lenge to the law than those other law­suits,” Staver said. “Those cases are all at an early stage. Some are at the pre­lim­i­nary in­junc­tion stage, or be­ing de­cided on stand­ing.”

A hear­ing is set for the case be­fore the ap­peals court this May. If the 4th Cir­cuit rul­ing is re­leased in early sum­mer, that could leave enough time on the Supreme Court’s fall docket to present chal­lenges to the con­tra­cep­tion re­quire­ments and the in­di­vid­ual and em­ployer in­surance, he said.

Ilya Shapiro, a se­nior fel­low in con­sti­tu­tional stud­ies at the lib­er­tar­ian Cato In­sti­tute, said those time es­ti­mates might be too ag­gres­sive. In his view, the case seemed more likely des­tined for a po­ten­tial hear­ing be­fore the high court early next year.

But the fact that the 4th Cir­cuit may be soon is­su­ing a de­ci­sion on the mer­its of the con­sti­tu­tional ques­tions at is­sue makes it a case worth watch­ing.

“In a cer­tain sense, Lib­erty has al­ready lit­i­gated cer­tain things and is fa­mil­iar with the courts, so I’m cu­ri­ous about this one,” Shapiro said. “We’ll see if the Supreme Court gives them an­other bite at the ap­ple.”

The 4th Cir­cuit in 2011 ruled that it could not ren­der a de­ci­sion on Lib­erty’s law­suit be­cause of a fed­eral law that bars courts from halt­ing the col­lec­tion of taxes. But the Supreme Court said in 2012 that the same law did not stop them from re­view­ing the ACA, which opened the door for Lib­erty to re­new its chal­lenge. James Blum­stein, a con­sti­tu­tional law pro­fes­sor in Van­der­bilt Law School’s Health Pol­icy Cen­ter, said Congress may well have the power to force busi­nesses to of­fer health in­surance. For ex­am­ple, Congress has a long-es­tab­lished power to reg­u­late min­i­mum wages.

But it’s not clear how the Supreme Court will rule on mat­ters of re­li­gious free­dom, he said. The Lib­erty case al­leges that Congress vi­o­lated the First Amend­ment’s guar­an­tee to free ex­er­cise of re­li­gion by fi­nan­cially pun­ish­ing in­di­vid­u­als and em­ploy­ers that refuse to help pay for other peo­ple’s health­care goods and ser­vices they find im­moral, in­clud­ing birth con­trol pills, ster­il­iza­tions and—ac­cord­ing to some crit­ics—abor­tions.

Even though Lib­erty’s 2010 law­suit did not chal­lenge the HHS rules—be­cause they had not yet been writ­ten—that doesn’t pre­clude the pri­vate Chris­tian univer­sity from rais­ing ob­jec­tions to them now.

“As long as the case is still alive, it can be amended to cover new laws or reg­u­la­tions that be­come ef­fec­tive. There is no im­ped­i­ment to that,” Blum­stein said. “I do think the em­ployer man­date and the re­li­gious free­dom clause as­pects of this are really in­ter­est­ing.”

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