Today the Supreme Court is scheduled to decide whether to grant cert in Golden Gate Restaurant Ass’n v. City and County of San Francisco, No. 08-1515. Actually, the Court has had the case on its cert docket for months. Last October, the Court voted to solicit the views of the solicitor general (SVSG), but the Justice Department held the request until well after PPACA was enacted. It finally filed its amicus brief in response on May 28. So, barring some other delay, the Justices will vote at their afternoon conference today about granting cert. Their decision is likely to be announced on Monday
GGRA v. San Francisco concerns review of a 9th Circuit decision upholding the “Healthy San Francisco” (HSF) program against a challenge that is preempted by ERISA. Under the program, certain employers must either spend a minimum amount for the health care expenditures of their employees or pay what amounts to a tax to the city. If the employer pays the City directly, its employees who are City residents and whose family incomes are less than 500% of the federal poverty level can obtain health care services through the HSF program. Contributions for nonresident employees or those whose incomes are too high to qualify for HSF are deposited in medical reimbursement accounts created on their behalf, which employees can use to pay out-of-pocket health care expenses. Any resident of the city who meets the income eligibility criteria can obtain care through the program; those who work for contributing employers receive a 75% discount on participation fees.
The 9th Circuit ruled that there was no conflict with ERISA because employers are coerced neither to offer benefits through an ERISA plan nor to pay the tax. 546 F.3d 639 (9th Cir. 2008). The Bush administration took the opposite position, and submitted a brief in support of en banc review, which the 9th Circuit denied. The Obama administration’s SVSG brief argues that the Court should deny cert because PPACA “significantly reduces the potential that state or local governments will choose to enact health care programs like [HSF] and may also affect the question whether such programs are preempted by federal law.” The brief also notes that the Department of Labor has not had time yet to address “whether such [state or local] laws might form the basis for waivers under Section 1332 of the PPACA of provisions concerning the creation of insurance exchanges.” Therefore, according to the SG, the enactment of PPACA deprives this case of its importance, thereby eliminating the strongest argument for certiorari.
If the Court denies cert, the strategy to enact pay or play laws, used by state and local health reform advocates since the demise of the Clinton proposal, will end. Not with a bang…