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Monday is Go Day – Supreme Court to Review the Affordable Care Act

March 22, 2012

While it doesn’t sound like a lot of time, the Supreme Court will hear six hours of oral argument over three days regarding the Constitutionality of the Patient Protection and Affordable Care Act (AC).  The oral arguments will begin Monday, March 26, in cases challenging the constitutionality of the ACA.  The Court will consider the individual mandate, Anti-Injunction Act issues, Medicaid issues and severability issues (whether the Court must uphold or reject the entire PPACA or can rule that only parts of it are unconstitutional). 

The time allocated for argument (and the order that the arguments will be heard) is as follows:

  • Anti-Injunction Act – 90 minutes
  • Minimum Coverage Requirement – 2 hours
  • Severability  – 90 minutes                                           
  • Medicaid – 1 hour

The Obama administration will argue that Congress had authority under the Commerce and Necessary and Proper clauses of the U.S. Constitution to enact the minimum coverage provision (individual mandate). It will argue that Congress has broad power to enact economic regulation and that the minimum coverage provision is an integral part of a comprehensive scheme of economic regulation. 

While the administration has gone back and forth on whether the individual mandate is or is not a tax, it appears that the administration will argue that the minimum coverage provision is independently authorized by Congress’s taxing power, that the minimum coverage provision operates as a tax and that the validity of an assessment under the taxing power does not depend on whether it is denominated a tax.

The Anti-Injunction generally requires that those wanting to challenge taxes have to pay first and file suit for a refund.  If the penalty for not complying with the mandate qualifies as a tax, then the Court could hold that a decision on the tax portion of the PPACA must wait until someone actually pays the penalty and files suit for a refund.

The Medicaid portion of the challenge focuses on whether Congress exceeded its enumerated powers or violated basic principles of federalism by coercing States into accepting conditions deemed onerous by threatening to withhold federal funding in the absence of state compliance with PPACA rules.

A ruling is generally expected by the Supreme Court by the end of June. However, there is, no requirement that the Supreme Court rule by that date.

Please contact Scott Lyon, Vice President, Small Business Services at (800) 362-5461 ext. 232 with questions or comments. 

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