O’Neill Institute for National and Global Health LawO’Neill Institute for National and Global Health LawLegal Issues in Health Reform

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Sure enough, Supreme Court denies cert in ERISA case

The Supreme Court declined to review a case in which a restaurant owners group attempted to invalidate a San Francisco requirement that local businesses either offer health insurance benefits to their employees or pay the city a fee that is used to fund a program offering medical services to low-income restaurants. In Golden Gate Restaurant Ass’n v. City and County of San Francisco, the Court apparently agreed with a Justice Department brief that the long-running debate over whether ERISA preempts such pay-or-play programs has been effectively mooted by the new federal health reform law. No surprises.

Meanwhile, back at the Supreme Court, the pay or play debate continues (but maybe not for long)

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…

Battle in the Bureaucracy: An Interview with James Morone, Part II

James Morone is professor of political science at Brown University. His most recent book, co-authored with David Blumenthal, is The Heart of Power: Health and Politics in the Oval Office. This is the second of a two-part interview.

Lester Feder: You argue that the ongoing fight against the health reform legislation in the courts and in the bureaucracy during implementation marks a break from a longstanding political tradition that politics end when legislation is passed. Why do you think this has happened now? Is it simply because our politics have become so bitterly partisan?

James Morone: There are two explanations: One is exactly what you said, that our politics have so become bitter. But secondly, I think somewhere between Reagan, who did it with a smile, and Newt Gingrich, who did it with a scowl, the Republicans have defined the Democrats as basically un-American and bad for the nation. Read More »

Battle in the Bureaucracy: An Interview with James Morone, Part I

James Morone is professor of political science at Brown University. His most recent book, co-authored with David Blumenthal, is The Heart of Power: Health and Politics in the Oval Office. This is the first of a two-part interview.

James Morone: There is something unique—and, to me, alarming—about this health reform process. Normally in our political system, when we have enormous battles over legislation, most political actors consider the politics done when the legislative battle is over. What’s new here is the idea that the battle goes on into the implementation phase. This wasn’t true for Social Security, it wasn’t true for Medicare, it wasn’t true for civil rights. Of course, interest groups always continued to fight to get the best deal possible in implementation. But that’s very different from it being Democrats versus Republicans or liberals versus conservatives. Today’s situation is very different.

Given how difficult implementation is, to have the politics continue both in the courts and bureaucracy really makes you worry about the American political process as a whole and this health reform in particular.

Lester Feder: When you talk about the politics continuing, what specifically are you referring to?

James Morone: For starters, the legal challenge—that casts a shadow over the whole business. It’s also the impression that the Republicans have vowed to battle this in the bureaucracy as well. I haven’t seen the details, but if that’s true, it’s really unprecedented. Read More »

“Rationing”: An Interview with David Orentlicher

David Orentlicher is the Samuel R. Rosen Professor of Law and Co-director of the William S. and Christine S. Hall Center for Law and Health at Indiana University School of Law.

Lester Feder: Let me start by asking you what do you think has not been adequately discussed about the health reform law?

David Orentlicher: Some aspects have not gotten as much emphasis as I’d like. There are two big problems with our health care system: inadequate access and unaffordable costs. The cost part was really left much more to another day. While there was much more done about the access problem and the projections are that more than 30 million more people will be covered, we’re still going to have more than 20 million uninsured after the legislation is fully implemented.

As long as we try to maintain the framework of our current system, we’re never going to solve either problem. We have a defective system. We really need to fix the problems with the current system rather than put more people into a defective system. Read More »

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