SCOTUS opens door to a new Obamacare challenge

November 26, 2012

It feels a bit like deja vu all over again. The Supreme Court has ordered an appeals court to reopen arguments on the Affordable Care Act's employer mandate and contraceptive coverage provisions, opening a potential path back to the highest court by late 2013.

The case at hand is one filed Liberty University, a Christian college in Virginia. The university had filed one of the earlier suits against the health care law, which was among the dozens dismissed by the Supreme Court when it ruled the Affordable Care Act's individual mandate to be constitutional.

The Liberty University case also is unique in that it was the only one where the appeals court decided it couldn't even make a ruling, given that the provisions it was supposed to rule on hadn't come into effect. The Fourth Circuit Court of Appeals ruled that the Anti-Injunction Act precluded any rulings about the mandate's constitutionality before the mandate actually took effect and individuals began paying penalties. 

The Supreme Court sided against that viewpoint. In its decision, the justices said that it was within the court's power to rule on the health law now. That leaves Liberty wanting some answers on the provisions it challenged in court. The Obama administration also agreed that these issues should go back to the Fourth Circuit. Other courts are already hearing new challenges to the health care law, too.

Liberty University doesn't want to challenge the individual mandate as a tax; we already know what the Supreme Court thinks about that. But it does want are answers whether the individual and employer mandates in the law violate religious freedoms, by forcing Americans to pay for abortions. "Petitioners’ remaining claims should be subject to adjudication by the lower courts," Liberty University's lawyers wrote in a July 2012 petition for re-hearing. 

The ever-helpful Lyle Denniston at SCOTUSBlog, who has covered the Supreme Court for decades now, observes that this is a pretty rare move:

Ordinarily, the Court simply denies rehearing pleas with routine orders.  The other side in such a situation is not even allowed to react to the rehearing petition unless the Court explicitly asks it to do so.  The Court held onto the Liberty rehearing plea over the summer — a period during which it routinely denied a host of other rehearing petitions, without comment.  The Justices took up the Liberty plea at their September 24 Conference, resulting in Monday’s order asking the Obama Administration to file a response — within thirty days – with advice on what the Court should do with the Liberty case.   While not signaling what the ultimate disposition might be, that was a sufficient break from the normal practice that it carried at least potential significance.

It's hard to know at this point what would happen if these two provisions of the health care law were overturned. Health policy experts don't tend to consider the employer mandate as crucial to the health law's success as the individual mandate. The vast majority of employers already provide insurance coverage, with no mandate at all.

If the mandate were to fall and employers were not to provide coverage, workers could potentially head to an insurance exchange and purchase coverage there, some with subsidies. Research suggests this coverage would end up costing employees more, but the option would still be there.

As to what happens next, the Fourth Circuit Court in Virginia must go ahead and rehear Liberty University's arguments against the employer mandate and mandated contraceptive coverage. Jennifer Haberkorn notes that this circuit court moves quickly, meaning oral arguments could happen as soon as spring 2013. And that could lay the foundation for a repeat performance in front of the Supreme Court late next year - just before the major parts of the health care law are expected to kick into gear.

 

 

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Ezra Klein · November 26, 2012