This morning, June 28, 2012, the United States Supreme Court released its decision upholding the constitutionality of the individual mandate – the centerpiece of President Obama’s health care law.
The individual mandate requires that all Americans maintain “minimum essential” health insurance coverage. Beginning in 2014, individuals that do not comply with the mandate must make a “shared responsibility payment” to the Federal Government. The amount of the payment varies with household income, subject to a floor and a ceiling based on the average annual premium that the individual would have to pay for private health insurance.
Interestingly, the Supreme Court rejected the Obama administration’s argument that the individual mandate was permissible under the Commerce Clause, instead concluding that the individual mandate was permissible under Congress’ taxing authority.
Another key provision of the Affordable Care Act is the expansion of the Medicaid program. The Affordable Care Act expands the scope of the Medicaid program and increases the number of individuals that states must cover. For example, the Act requires state programs to provide Medicaid coverage to adults that earn up to 133 percent of the federal poverty level. Many states only provide Medicaid to individuals whose incomes are significantly lower.
While the Act increases federal funding to cover the states’ costs in expanding coverage, it also threatened to withdraw all federal Medicaid funds for failure to comply. This morning, the Supreme Court ruled that while it was permissible to expand the Medicaid program, the Act could not withdraw existing Medicaid funds for states that opt out of the expansion.
A copy of the full opinion can be found here–> USCT ACA Opinion
For more information on the U.S. Supreme Court’s decision, please feel free to contact any member of our health care practice group for a further discussion.
Please all check back here often for further posts on the decision.
Posted in Accountable Care Organizations, Civil Litigation, Consumers, DHHS, Health & Human Services, Health Care, Health Care Providers, Health Insurance, Health Reform, Medicaid, Medicare, Payers, Regulation
Last November, the IRS released Revenue Ruling 201145025 denying an application for tax-exempt status of an entity owned by a tax-exempt hospital (the “Entity”). The Entity primarily contracted with commercial payors to provide hospital services and physician services. The Entity’s activities are comparable to the activities an Accountable Care Organization (ACO) may conduct unrelated to the Medicare Shared Savings Program (the “Savings Program”), such as shared savings programs with commercial payors. The Revenue Ruling, therefore, provides additional guidance regarding the IRS’ concerns relating to the activities of ACOs that are unrelated to the Savings Program. Continue reading
Benesch had the opportunity to sponsor the ACG NY 4th Annual Health Care Conference on January 25th, 2011 at the Metropolitan Club in New York City. The conference was a great success with attendees from the private equity, lending, investment and service provider communities. We want to thank all those who attended the conference. It was a great event.
More importantly, we wanted to thank the panelists who put on a great presentation. The panel presentation provided significant insight into the coming challenges and unknowns for the hospital sector in 2012. The discussion of policy initiatives that are pushing toward more integration and the assumption of risk by providers was enlightening. Continue reading
Posted in Accountable Care Organizations, Acute Care, Benesch Events, Health & Human Services, Health Care, Health Care Providers, Health Reform, Hospital, Integration, Investors, Medicare, Private Equity
CMS’ Medicare Learning Network (MLN) just released Fact Sheet, ICN 907404, which is designed to provide education on the provisions of the final rule that implements the Medicare Shared Savings Program with Accountable Care Organizations (ACOs). It includes background, information on how ACOs impact beneficiaries, eligibility requirements to form an ACO, and information on monitoring and tying payment to improved care at lower costs.
You can get a copy of the Fact Sheet here —> ICN 907404