More Than Just the ACA at Stake in King v. Burwell

Guest post by Erin Fuse Brown
[Cross-posted from Center for Law, Health and Society Blog]

Commentators have been weighing in since the Supreme Court decided it would hear King v. Burwell, the case challenging the ability of millions of Americans to receive subsidies to purchase health insurance on federally operated Exchanges under the ACA.  Debate swirls over whether a decision striking down these subsidies will gut the ACA or not, but at the very least a ruling in favor of the petitioners would have grave consequences for ACA the and the millions that currently receive these subsidies.

There is, however, more at stake in the King case than the ACA.  If the Court takes this opportunity to cut down the ACA, it does so at the cost of the principle of separation of powers and the Supreme Court’s institutional legitimacy and credibility.

Chevron

The question in King will be resolved under the Chevron framework, which provides that if a statutory provision is ambiguous, then the court must defer to the agency’s interpretation, so long as it is permissible.  Reasonable, learned minds have been disagreeing on the meaning of the statutory provision. As Adrian Vermeule has pointed out, of the 9 federal judges that have reviewed this question, 6 have agreed with the government’s interpretation or concluded the statute is ambiguous, and 3 have concluded that the statute unambiguously precludes subsidies. This type of judicial disagreement is evidence itself of statutory ambiguity.  Continue reading

Check out the latest news from the Petrie-Flom Center!

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Check out the November 14th edition of the Petrie-Flom Center’s biweekly e-newsletter for the latest on events, affiliate news and scholarship, and job and fellowship opportunities in health law policy and bioethics.

Health and Wealth

By David Orentlicher
[Cross-posted at Health Law Profs blog]

A number of studies have suggested that education, wealth, and other socioeconomic factors are more important than health care in promoting a person’s health. Earlier this week, NPR reported on a study of welfare payments that reinforces the link between income and health. Researchers studied children whose families received benefits through the Mothers Pension Program between 1911 and 1935. Compared to children in families that did not receive program benefits, the children of recipients lived longer, and their longer lives might reflect the fact that they stayed in school longer and earned higher incomes during their working days.

Call for Proposals: The 2016 Brocher Foundation Residencies

By Timo Minssen

I have just been informed that a new call for proposals for the 2016 Brocher Foundation residencies has been launched. I can warmly recommend this splendid opportunity to any researcher or group of researchers in the fields of Bioethics, Medical Anthropology, Health Economics, Health Policy, Health Law, Philosophy of Medicine and Health, Medical Humanities, Social Science Perspectives on Health, Medical Ethics, or History of Medicine.

A grant by the Brocher Foundation enables international researchers to carry out their projects for a 1-4 month period at one of the most beautiful places in Europe. The Brocher Foundation’s seat is located in Switzerland at the shores of the beautiful Lake Geneva. The location is very close to the French border and to international organisations particularly relevant to the health sector, such as WHO, WTO, WIPO, UNHCR, ILO, WMA, ICRC, and others.

The following information has been extracted from the webpage of the Brocher Foundation:  Continue reading

HLS Health Law Workshop with Leemore Dafny

HLS Health Law Workshop: Leemore Dafny

November 10, 2014 5:00 PM
Griswold Hall, Room 110 (Harvard Law School)
1525 Massachusetts Ave., Cambridge, MA [Map here.]

Download the paper: “More Insurers Lower Premiums: Evidence from Initial Pricing in the Health Insurance Marketplaces” (co-authors, Jonathan Gruber and Christopher Ody)

Leemore Dafny is a Professor of Management and Strategy and the Herman Smith Research Professor in Hospital and Health Services at the Kellogg School of Management at Northwestern University. Her research examines competitive interactions among payers and providers of healthcare services, and the intersection of industry and public policy. Dafny’s work has been published in journals such as the American Economic Review and the New England Journal of Medicine, and featured in The New York Times, BusinessWeek, Bloomberg, and The Washington Post.

Current projects include studies of consolidation in the U.S. hospital industry and the kidney dialysis industry, organizational form of provider practices, copayment coupons for prescription drugs, and the implications of for-profit ownership of insurance companies.

Prop. 46: Lawyers v. Doctors

By Emily Largent

California Proposition 46, the Medical Malpractice Lawsuits Cap and Drug Testing Doctors Initiative, is on the November 4, 2014 ballot.  If approved by voters, the initiative would: increase the state’s cap on non-economic damages that can be assessed in medical negligence lawsuits; require hospitals to test certain physicians for drugs and alcohol; and require healthcare providers to check a statewide prescription drug database before prescribing or dispensing certain drugs to a patient for the first time.

The  debate over Proposition 46 has been framed as a battle between doctors and lawyers.  See also here or here.  It’s not hard to see why.  Attorneys have contributed the vast majority of the “yes” campaign‘s $9 million fund.  By contrast, nearly three-fourths of the “no” campaign‘s $57 million has come from six insurance companies; other big backers include the state medical and dental associations.  (It is the most expensive campaign in California this year.)  While the two sides have made a variety of arguments for and against Proposition 46′s various provisions, I want to focus on the putative costs and cost-savings:

First, Proposition 46 would increase California’s current $250,000 limit on non-economic awards (which dates to the Medical Injury Compensation Reform Act of 1975) to $1.1 million, and provide for annual adjustment for inflation going forward. The non-partisan Legislative Analyst’s Office estimates that increased state and local government health care costs from raising the cap likely range from the tens of millions of dollars to several hundred million dollars annually.  On the other hand, a RAND study of EDs in three states with strict malpractice limits found the caps had little effect on the cost of care.  Continue reading

Expelling Immigrants from the Exchanges

[Cross-posted from HealthLawProf Blog.]

The warning by the Centers for Medicare and Medicaid Services (CMS) last month that up to 115,000 people might lose their health insurance under the Affordable Care Act (ACA) unless they can send proof of their citizenship or immigration status was more than a bit ironic. After spending much of the year and millions of dollars trying to boost participation in the exchanges, CMS is now trying to reduce participation. In so doing, it will likely exclude many young, healthy adults, just the type of people that the exchanges need to succeed

The reason for the exclusion lies with the heated politics of immigration, and our ambivalent approach to providing immigrants with health care. Although the ACA’s critics have lambasted the law on many accounts, when the Act was first debated in Congress no charge – not even death panels! — was made more heatedly or drew more attention than the claim that the Act would cover illegal immigrants. It was that charge, after all, that Representative Joe Wilson referred to when he shouted “You lie!” during the President’s speech to a joint session of Congress.

Obama, however, didn’t lie when he promised that the Act would not cover illegal immigrants. The ACA bars from the exchanges immigrants who are “not lawfully present,” a category that includes the so-called Dreamers, the young immigrants who by virtue of an executive order have a right to live and work in the country. It also requires exchange applicants to provide their Social Security number and, in the case of non-citizens, information about their immigration status, which must be verified by the Department of Homeland Security. These are the requirements that CMS is now enforcing.  Continue reading

The Father of Sunshine

Paul Thacker

Over at our sister blog for the Safra Center’s Institutional Corruption Lab, Paul Thacker has a great post about how the Physician’s Payments Sunshine Act came to exist. The new database created by the Act is just now going live, and its a good time to reflect on how we got here. Thacker was a staffer for Senator Chuck Grassley, and from that vantage, has rare insight into how the bill was conceived and how initial objections of Big Pharma were overcome. Thacker also outlines several complementary efforts, including pressure to reform NIH policies around conflicts of interest. That proposal went all the way to the White House, where it was gutted. Worth reading.

How much promise do safety-net ACOs really hold?

The Health Affairs blog recently published an important write-up of the status of safety net ACOs. Therein, authors James Maxwell, Michael Bailit, Rachel Toby and Christine Barron offer five “key observations regarding emerging safety-net ACOs and suggest broad policy implications” which are drawn from what appears to be a fairly extensive research project including “site visits and telephone interviews with 66 safety-net ACO leaders and state officials conducted over the last two years in 14 states.” Generally, they leave the reader with an optimistic impression of safety-net ACOs efforts to achieve population health – which contrasts with my previous post on Bill of Health.

In short, the authors offer the following observations:

  1. State policy is a key factor in the formation of safety-net ACOs.
  2. Both health policy experts and those involved in forming ACOs consider health homes, high-cost case management, and integrated behavioral health to be priority delivery system transformations for ACOs in the safety-net.
  3. It takes money to save money: upfront capital and financial flexibility are required for investment in delivery system transformations.
  4. Safety-net ACOs are adopting payment and delivery system transformations incrementally.
  5. Building on a long-standing recognition of how non-medical factors impact health outcomes and utilization, safety-net ACOs are addressing social determinants of health through community partnerships.

The entirety of the post is well-written and I encourage folks to check it out for themselves. My concerns about the ACO model do still largely hold, however. While the authors of this blog highlight four states (MA, OR, AL and MN) with policies on the books to encourage creativity in safety-net ACO design, that leaves 46 others without such supportive legislation. In short, I think we are still working at the margins here. Moreover, I worry that the authors have chosen a definition of ACO that goes well beyond what CMS considers to be an ACO and in so doing have spotlighted “bright lights” of the health care delivery landscape that may not have the metrics and results to support their claims at innovation. The authors offer us little information about what kind of improvements either in quality of care or health outcomes these safety-net ACOs have been able to achieve. (Meanwhile, CMS recently released the latest quality metrics on the Pioneer and Shared Savings ACOs they sanction and monitor.)

The bottom line is this: safety-net ACOs, like all ACOs, certainly hold promise. The question is whether we will translate this promise into systems-level change.

Discrimination on the Basis of Health Status in Health Insurance: “Market-Norm or Necessity”?

By Kate Greenwood
[Cross-posted at Health Reform Watch]

In recent months, advocates have alleged that discrimination on the basis of health status in health insurance continues, notwithstanding the Affordable Care Act’s attempts to level the playing field for people with chronic health conditions. How the government and industry should respond to the allegations is not clear, however, in part because what constitutes “discrimination” is not clear in this context. As Jessica Roberts has noted, there is an “intrinsic tension between an antidiscrimination framework and the practices of the private, for-profit health-insurance industry.” This tension makes it difficult to pinpoint where permissible cost-consciousness ends and impermissible discrimination begins.

As has been widely reported, at the end of May, the National Health Law Program, along with the Tampa-based organization The AIDS Institute, filed an administrative complaint with the United States Department of Health and Human Services’ Office of Civil Rights in which they allege that four qualified health plans offered through the federally-facilitated marketplace in Florida discriminate by “charg[ing] inordinately high co-payments and co-insurance for medications used in the treatment of HIV and AIDS.” The complainants go on to allege that because “[o]ther issuers vary tiering or place HIV drugs on more affordable tiers,” “the practice of placing all anti-retrovirals on the highest tier is not a market-norm or necessity.”

The complaint’s emphasis on whether the plans’ actions reflect a “market-norm or necessity” tracks the Centers for Medicare & Medicaid Services’ 2015 Letter to Issuers in the Federally-Facilitated Marketplaces, in which CMS writes that “to ensure nondiscrimination in [qualified health plan ("QHP")] benefit design, CMS will perform an outlier analysis on QHP cost sharing (e.g., co-payments and co-insurance) as part of the QHP certification application process.” CMS goes on to specify that, with regard to prescription drugs, a plan will be considered an “outlier” if it has “an unusually large number of drugs subject to prior authorization and/or step therapy requirements in a particular category and class.”

As Sarah Rosenbaum has noted, “CMS does not provide a review methodology or define what is ‘unusually large’.” Even if it had, what if subjecting a large number of drugs to prior authorization or step therapy requirements did not make a plan unusual? Would that mean that doing so was not “discrimination”? Continue reading

What’s to become of population health?

When the accountable care organization (ACO) model was initially conceptualized, many in the health policy world hoped it could provide a platform for real transformation of US health care.

Among the ACO model’s most promising innovations was its explicit orientation towards achieving “the Triple Aim.” First articulated by Don Berwick and the Institute for Healthcare Improvement (IHI), the Triple Aim is a strategy for optimizing the health care delivery system and achieving the best of all worlds. It outlines three goals: high quality health care, lower costs, and population health. The Center for Medicare and Medicaid Services adopted this goal and still describes a version of the Triple Aim on its webpage titled “Innovation.”

Continue reading

To Watch: Rural Enrollment on Exchanges

As we gear up for a second year of exchange marketplace enrollment, one issue to keep an eye on is the success we have at getting people who live in rural areas onto the healthcare rolls.  As pointed out in today’s Kaiser Health News write-up (here), there is potential for the ACA to increase rural health disparities, even while it gets more people insured, because many of the efforts to encourage enrollment–think navigators, enrollment centers, advertising, and outreach–just work better in urban areas.  For some reading on this issue, see the Kaiser Family Foundation’s posting here, the HHS’s Health Resources and Services Administration’s report here, and the Rural Health Foundation’s roundup here.

Beneficiaries File Class Action Lawsuit Challenging Medicare Hearing Delays

I have blogged a few times about the current backlog in Medicare’s coverage appeals process, including observations about a lawsuit by providers challenging the backlog in federal court in the District of Columbia.  (See here.)  Yesterday a new lawsuit was filed, this one a class action lawsuit by beneficiaries represented by the Center for Medicare Advocacy.  (See their press release here.)  The case is Lessler et al. v. Burwell, 3:14-CV-1230 (D.Conn.).  I am blocked from accessing the complaint on PACER but am working on getting a copy.

Without access to the complaint it is dangerous to speculate, but I wonder whether this suit may be subject to many of the exhaustion-based arguments that I thought could lead to dismissal of the provider suit.  But the Center for Medicare Advocacy has had success pursuing class action suits on behalf of Medicare beneficiaries before, most notably the Jimmo case that led to a significant change in the standard of qualification for skilled nursing care.  (See here.)

One thing about this suit that may only be interesting to administrative law buffs is the choice of forum.  This case was filed in Connecticut, not the District of Columbia (where the providers filed their suit).  As I have written about elsewhere, there are pros and cons to channeling administrative law cases through DC, among them DC’s expertise in exhaustion and other administrative law issues.

I can’t say whether the Center for Medicare Advocacy chose to file in Connecticut rather than the District solely because that is their home forum, or whether they thought they’d get a more sympathetic judge/more plaintiff-friendly exhaustion doctrine.  And the same goes for the providers’ choice to file in the District rather than some other state.  I can say from experience, though, that the choice can really matter; DC judges’ familiarity with administrative law issues just makes them perceive these cases differently from the start.  So it would not surprise me at all if there are considerations beyond mere location at play here.  (Not that there’s anything wrong with that!)

Averting Mental Health and Fiscal Crises: Crisis Intervention Teams and Access to Meaningful Treatment for Mental Illness

[Blogger's Note: I am very pleased to share this post by my colleague at Seton Hall Law, Tara Adams Ragone. This post was cross-posted at Health Reform Watch.]

By Tara Adams Ragone

Social media recently focused my attention on two very different law enforcement interactions with people with mental illness that reinforce the need for increased training of law enforcement in crisis intervention as well as the need for improved access to treatment for people with mental illness.

The first is a video of the fatal police shooting of Kajieme Powell in St. Louis, Missouri earlier this month.  Mr. Powell was twenty-five years old and suspected of shoplifting junk food from a convenience store.  The first eighty seconds of the video show Mr. Powell pacing and muttering on the sidewalk — with four pedestrians passing by without incident — before the police arrive.  The police then exited their vehicles with their guns drawn, shouted at Mr. Powell to drop his weapon, and fired about twelve shots fewer than twenty seconds after they arrived on the scene.

The second is an NPR story that included an audio recording of law enforcement officials in San Antonio, Texas responding to a 911 call about a twenty-four year old group home resident named Mason, who was off of his medications, had set his blanket on fire, and was a danger to himself and others.  When they arrived at the scene, the officers acknowledged that they did not use the “tough guy command voice” that they typically would in responding to a 911 call reporting suspected criminal activity.  Instead, in plain clothes and without their weapons drawn, they spoke calmly with Mason, reassuring him that they wanted to get him help.  They astutely noticed signs suggesting that Mason was experiencing tactile, auditory, and visual hallucinations, and with patience and skilled questioning, got him to acknowledge the hallucinations and seek psychiatric treatment.

The San Antonio officers were members of a six-person mental health squad that the city created to confront severe prison overcrowding. Continue reading

Government seeks en banc rehearing in Halbig

Today the government moved for en banc rehearing in Halbig, as expected.  (HT: Rachana Dixit Pradhan @ insidehealthpolicy.com.)  I have not had the chance to review the petition but thought I would share it.  (For those looking to brush up on some of the blog debate on the case before reading, see here and here.  For more details on the en banc process see my earlier post here.)

The Government argues that rehearing en banc is warranted because the “disruption threatened” by Halbig makes the case one with exceptional importance.  One interesting bit did catch my eye, in light of that assertion.  It is footnote 7, which offers the Government’s view on the impact of the ruling in Halbig, and might be taken as sort of a cf.:

“The panel majority suggested that its ruling would apply nationwide, Op. 41-42, but it did not squarely hold as much or address the many reasons why relief should not extend beyond the named plaintiffs. The panel’s decision does not control in other circuits, just as the Fourth Circuit’s King decision does not control here.”

Here is the petition: Halbig En Banc Petition

The D.C. Circuit Got it Wrong. Congressional Intent on Exchange Subsidies Is Clear, If You Know Where to Look

By Robert I. Field

Why would Congress have limited Affordable Care Act subsidies to residents of only some states – those that establish their own insurance exchanges? The law authorizes credits for the purchase of insurance “through an Exchange established by the State under section 1311.” The D.C. Circuit found that this wording excludes federally established exchanges and that Congress might have intended this to induce states to establish their own exchanges rather than letting the federal government take over.

But the Court acknowledged that there is no evidence of such intent in the legislative history. And such a purpose would conflict with the ACA’s overall goal of extending health insurance access to all Americans.

With no legislative history as a guide, is there another plausible explanation of Congressional intent? Is the best answer to the D.C. Circuit’s opinion that the phrase was a drafting error, as the dissent seems to imply? Why else would it have found its way into the law?

Inartful though it may be, the wording can be seen to serve a different purpose that is consistent with the rest of the ACA. It can be understood not as a way to distinguish exchanges established by a state from those established by the federal government but to distinguish those established publicly from those created privately.

Continue reading

The Problematic Jurisprudence of Halbig v. Burwell

Like the recent Supreme Court decision in Hobby Lobby, the D.C. Circuit’s ruling earlier this week in Halbig v. Burwell is being hailed by conservatives and bemoaned by liberals as a death knell for Obamacare.  Unlike the decision in Hobby Lobby, however the D.C. Circuit’s ruling is not the end of the matter, and many liberals are finding hope in the ruling of the 4th Circuit the same day, the probability of an en banc hearing in the D.C. Circuit, and the ultimate possibility of a favorable Supreme Court decision.  In an earlier post in HealthLawProf, I decided to take seriously the possibility of damage control from a limited reading of Hobby Lobby.  It is pretty much universally agreed—and I believe correctly—that it is not possible to do similar damage control by giving a limited reading to Halbig v. Burwell.  If the ruling stands, that tax subsidies are not available to people purchasing coverage through the exchanges in the states that are letting the federal government do the work, many important other provisions of the ACA will be untenable, including the penalties for large employers not offering insurance whose employees receive subsidies and likely the individual mandate itself.  But I think it is possible to undermine Halbig in a way not generally recognized by the liberal critics who argue (correctly) that the statutory provision at issue is ambiguous:  argue that the jurisprudence of the majority opinion in Halbig is internally inconsistent.  Here’s how. Continue reading

A Mixed Message on Obamacare from Two Federal Circuits

By Greg Curfman and Holly Fernandez Lynch

It was as if lightning had struck twice in the same place.

On Tuesday two pivotal federal circuit court opinions that could dramatically impact the future of Obamacare were unexpectedly issued within hours of each other. And what’s more, the two opinions reached opposite conclusions on the same question, setting the stage for further appeals and possible Supreme Court review, potentially bringing the Affordable Care Act (ACA) before the high court for the third time since its passage.

At issue in both circuit court cases was the legality of providing subsidies in the form of Internal Revenue Service tax credits for the purchase of health insurance on the federal exchange (Healthcare.gov).

In a decision that stunned Obamacare supporters–but elated opponents–a three-judge panel of the Federal Appeals Court for the DC Circuit ruled in Halbig v. Burwell that the purchase of health insurance on the federal exchange may not be subsidized by IRS tax exemptions. This judgment would leave millions of Americans with earnings between 133% and 400% of the federal poverty level without affordable health insurance, and it would also threaten the viability of the employer mandate.

In contrast, in a unanimous (3-0) opinion in a nearly identical case, King v. Burwell, the Federal Appeals Court for the Fourth Circuit in Richmond, VA, came to the opposite conclusion.

Continue reading

Don’t Buy the Cooperative-Federalism-Makes-Halbig-Logical-Argument

By Abbe Gluck

Cross-posted at Balkinization and Election Law Blog

I had hope to take a day off blogging about Halbig and King (the ObamaCare Subsidies cases), but I cannot allow another new, and inaccurate, narrative about ObamaCare to take hold. Over at Volokh, Ilya Somin argues that the holding in Halbig is not absurd because Congress uses statutory schemes all the time that try to incentivize states to administer federal law (and penalize them if they don’t).  It is true we see schemes like that all the time–Medicaid is a prime example–but the insurance exchange design at issue in these cases is NOT one of them.  This federalism argument was made before the D.C. Circuit and even Judge Griffith didn’t buy it in his ruling for the challengers.  I tried to dispel this myth back in March, when I wrote the following on Balkanization. As I said there, this isn’t Medicaid—it’s the Clean Air Act.

Continue reading