Archive for "health care"
The ObamaCare Decision: Student Voices
We asked your classmates for their opinions about the ObamaCare decision. Which Justice got it right? Check out their responses below, and add yours in the comments!
ADAM LUDEMANN, 2014
Adam is the President of the Federalist Society, but the views expressed here are his own. The Federalist Society is a student group whose purpose is to promote a respectful, thoughtful and engaging discourse on campus addressing issues of concern to libertarians, conservatives and the greater student body. They host series of discussions each year featuring topics such as healthcare reform, federalism and economic freedom. Adam encourages anyone interested in further discussion to check out their events on BLSConnect. The Federalist Society does not endorse particular policy positions.
I tend to agree with the Roberts opinion and Thomas, Scalia, et al…As a matter of cost reduction, I believe Congress could have better achieved its ends by reforming the tax code…and allowing the purchase of health care insurance… across state lines…
How does this decision affect you?
“As a paralegal at a large corporate firm before law school, I had great health insurance with broad coverage, low deductibles, and responsive customer service. As a law student over the age of 26, I currently have no real choice other than to participate in the BLS-sponsored insurance program, which features higher deductibles, low prescription drug coverage maximums, more restricted coverage, and terrible customer service. The benefit I receive per dollar of health care spending is clearly lower.”
What are your concerns about the practical implications this decision has on health law?
“I believe that many of these differences, and many of the problems with our healthcare system, ultimately arise from employer tax preferences which came about in the context of wage controls during the Second World War. These tax policies have distorted the healthcare market, linking health insurance to employers in a way which makes healthcare arbitrarily more expensive for the unemployed, students and those who are self-employed.”
As a matter of cost reduction, I believe Congress could have better achieved its ends by reforming the tax code to address these problems and allowing the purchase of health care insurance, like many other insurance products, across state lines, allowing for greater customer choice, more efficient distribution of healthcare services, and broader risk pools for those with preexisting conditions.”
So, which Justice got it right?
“I don’t pretend to be familiar with the law relating to the tax/penalty distinction, although I tend to agree with the Roberts opinion and Thomas, Scalia, et al. on the limitations the decision places on the Commerce Clause, the Necessary and Proper Clause and the Federal government’s conditional spending power vis-à-vis the States.
Parting thoughts?
“I wholeheartedly agree with the ACA’s goal of ensuring coverage for pre-existing conditions and coverage for those who are economically disadvantaged. However, I think that lowering costs as described above in connection with a tax refund or voucher-based system would lead to a cleaner, more progressive redistribution of health care resources without the market inefficiencies and cross-subsidies associated with a mandate and regulated approach.”
VERONICA JACKSON, 2014
Veronica is the Co-Chair of the Health Law and Policy Association (HLPA) and the Chair of Girls on the Run BLS pro-bono (GOTR). HLPA is a student-run organization that brings together students interested in a variety of Health Law fields to discuss today’s health care issues and to unite students and health law professionals with similar interests. GOTR is a new pro-bono program at BLS, bringing positive role models to an underserved elementary school in New York City. BLS coaches help to teach life skills through dynamic, conversation-based lessons and running games.
Overall I’m extremely pleased with the outcome of this case…My biggest hesitation with the law is how comprehensive the lowest ranked plans offered in Exchanges will be, and if they will actually lead to an increase in primary care services.
How does this decision affect you?
“I currently have health insurance, but will be losing it when I turn 26 in March and will likely enroll in the BLS offered plan.
Personally, this decision does not have that much of an impact on me. My parent’s health insurance has allowed young adults (up to age 26) to stay on their plan for years, so a negative outcome would not have had an effect on me as of yet. I also cannot foresee myself ever choosing not to have health insurance so the mandate would not really be mandating me to do anything I did not want to do anyways. I am concerned that the plans that I may be able to afford after law school will not be comprehensive enough, but the New York Exchange has yet to release all of its guidelines.”
Which Justice got it right?
“I agree most with Justice Ginsburg’s opinion in that the ACA would have been constitutional under the Commerce Clause. I agree with the Administration’s position that health care is a very unique market in that virtually everyone will enter it at some point in their lifetime. Because of this, I feel that Congress did have the power to enact this law under the Commerce Clause. One of my favorite quotes in her opinion sums it up nicely: ‘Why should the Chief Justice strive so mightily to hem in Congress’ capacity to meet the new problems arising constantly in our ever developing modern economy? I find no satisfying response to that question in his opinion.’”
Parting thoughts?
“Overall I’m extremely pleased with the outcome of this case. I’m a proponent of a single-payer system or a two-tiered system (such as in Germany), but in the interest of being realistic, I know that neither system is in our immediate future. So for now, I support the ACA. Decreasing emergency room use and increasing preventative care are crucial to decreasing our nation’s healthcare costs, and these two goals are made possible in the ACA by giving more Americans access to health insurance.
My biggest hesitation with the law is how comprehensive the lowest ranked plans offered in Exchanges will be, and if they will actually lead to an increase in primary care services. In order to avoid the penalty, many Americans may enroll in plans that still make health care too costly to obtain. This would cause those enrollees to waste money on their premiums each month while still not to receiving health care. The standards will be set by various exchanges, but if Massachusetts is any indication, a new class of “under-insured” may emerge. I am also concerned with how the insurance market could play out 10-15 years from now. There is often very little oversight for these private health plans, and they could become very powerful in years to come. As an intern at the Medicare Rights Center, I have been able to see first-hand how the policy set by regulation committees can often have little to no effect in the implementation and regulating of a plans day-to-day operations and services. Suggestions to committees are for one reason or another often ignored or glossed over when passed onto plans, giving plans too much power and not enough supervision. Hopefully stronger guidance would be built into this system.”
*Editor’s note: We hope you join the discussion but please keep your comments respectful.
The Affordable Care Act Cases: An Analysis
For any incoming law student, the decision in National Federation of Independent Business, et al., v. Sebelius (The Affordable Care Act Cases) is an excellent primer for law school and a good option for summer reading. If you can read and understand all 180+ pages of this decision, then you will have a leg up when it comes time to take Constitutional Law. I would be surprised if Con Law professors do not include this decision in their syllabus, for it explicates the Roberts Court’s position on the Commerce Clause, its application, and its boundaries.
Although many students will not read the entire opinion because of its length, they may want to know what practical effects it has on them. There are two: (1) Students under 26 may remain on their parent’s health insurance plan (as they have been able to do since 2010); and (2) come January 1, 2014, they will be required to have health insurance or else pay a penalty on their next tax filing.
Some students may qualify for Medicaid, which may be the better option if you are over 26 and make less than $11,000 per year.
Brooklyn Law School offers students health insurance by Aetna through Gallagher-Koster. It costs about $1550 for the 2011-2012 academic year. At press time, rates for the 2012-2013 year had not been posted. While New York and New Mexico are very different states, the rate increases approved by the New Mexico Board of Regents for that state’s university system might provide guidance on possible cost increases in New York next year.
New Mexico has the second-highest number of uninsured people in the country at 21.7% (Texas is first with 26.7%) while New York is two percentage points below the national average at 14.8%. Until this year, the price of student health plans in both states was similar. Rates were previously $1,400 for the University of New Mexico until the Board of Regents voted on June 7, 2012, to increase the cost by 22%, or about $308. They said this increase was needed to put the school’s plan in compliance with the ACA, if passed. If the BLS Student Policy is raised by 22%, it will go up about $341, making it around $1,900 per year.
Some students may qualify for Medicaid, which may be the better option if you are over 26 and make less than $11,000 per year. Notably, the AccessNY health plan does not classify scholarships, grants, or work study as “income.” A student interested in either plan should note the differences between the two (for example, BLS does not cover dental care; Medicaid does).
The Effect on State Finances
On July 9, 2012, Texas Governor Rick Perry declared that the state would not “opt-in” to the Medicaid Expansion contemplated by the Affordable Care Act. As noted above, Texas has the highest percentage of uninsured individuals in the nation. So, what does this mean for the state of Texas and its residents?
The CBO projects that states will spend only 0.8% more than they would have, absent the ACA.
In his dissenting opinion, Justice Scalia uses Arizona to illustrate the increased burden states will face if they do not comply with the Medicaid Expansion, which requires states to offer Medicaid to all individuals under the age of 65 with an income at or below 133% of the federal poverty line. Justice Scalia notes that Arizona typically commits 12% of its state expenditures to Medicaid, and relies on the Federal Government to provide the rest, which amounts to $5.6 billion, or close to one-third of Arizona’s annual state expenditures. He then argues that if Arizona refuses to comply, it will lose all federal Medicaid funding, and will have to increase its state Medicaid funding by 33%. This means, essentially, that Arizona will put a whopping 45% of its state expenditures towards Medicaid.
Justice Ginsburg, on the other hand, notes in her concurring opinion the Congressional Budget Office’s estimate of state spending. The CBO projects that states will spend only 0.8% more than they would have, absent the ACA. Accordingly, Justice Ginsburg contends that the federal government will cover 100% of the cost for newly eligible beneficiaries beginning in 2014, decreasing to 90% of the cost by 2020.
Texas spent nearly $22.8 billion on Medicaid in 2009, or approximately 25.4% of its state budget. The state received roughly $25.9 billion in federal funding for the program in 2010-2011. Because of Texas’s refusal to opt in, it will need to spend $48.7 billion per year, instead of the cost of expanding its coverage to residents at-or-below 133% of the federal poverty line. This annual income threshold is approximately $15,000.
It’s difficult to project the actual cost of the Medicaid Expansion to states. Justice Ginsburg’s 0.8% figure underscores the similarity of this situation to Dole (another case that features prominently in the first year Constitutional Law curriculum), which is discussed thoroughly in all three ACA opinions. But this is not a Dole situation. The penalty for non-compliance is, in the Chief Justice’s words, “a gun to the head.”
Justice Ginsburg’s figure does not take into account administrative expenses, nor does it specify whether that 0.8% figure applies for 2013, or the seven year period between 2013 and 2020. It appears to be the latter because she stresses that the federal government will cover 100% of new Medicaid enrollees next year.
Individual Mandate Penalties
The Individual Mandate was upheld; the most controversial aspect of it is a potential broadening of the taxing power. Consider this hypothetical:
The year is 2016. Unfortunately, you do not have a job. You are a solo practitioner who takes the cases you can get and you live from paycheck to paycheck and you can barely make the rent for that $800/month three-bedroom apartment you share in Williamsburg. You’re single. You reject whatever health insurance the American or New York City or New York State or Brooklyn Bar Associations offer because you just can’t afford it. Perhaps you should be on Medicaid, but you actually make about $35,000 a year, so you don’t qualify. You’re paying off loans without the Loan Repayment Assistance Program. You like to go out on the weekends and you try to keep your body in excellent physical shape. You almost never get sick, and when you do, you never need to go to the hospital.
One may actually “save money” by paying the tax, but…other federal (and possibly state) taxes are likely to increase.
April comes around and you start thinking about how you’re going to declare your income. You’re an honest person, so you keep accurate records of your income. If you choose to “say no,” your penalty will be “determined by such familiar factors as taxable income, number of dependents, and joint filing status.” (Majority at 33)
“In 2016, for example, the penalty will be 2.5% of an individual’s household income, but no less than $695 and no more than the average yearly premium for insurance that covers 60% of the cost of 10 specified services (e.g., prescription drugs and hospitalization) § 5000A(c); 42 U.S.C. § 18022.” (Majority at 7)
- 2.5% of $35,000 is $875 per year.
- 2.5% of $45,000 is $1,125 per year.
- 2.5% of $55,000 is $1,375 per year.
Thus, one may actually “save money” by paying the tax, but as the dissent points out, other federal (and possibly state) taxes are likely to increase. It’s impossible to predict what the market will be like in 2016, or how the “exchanges” will truly operate. But if your income reaches the maximum level, and you’re beyond the 400% poverty level for “exchanges” ($44,680?), this provision may fix the price of minimum coverage in the market.
Conclusion
The Majority held that the Federal government does not have the power to order people to buy health insurance, but does have the power to tax those without insurance. Therefore, law students will have a few more sentences to write in their Constitutional Law exams. A brief outline may look like this:
- Lopez (1995): Gun-Free School Zones Act Unconstitutional under Commerce Clause (keeping guns away from schools does not have an effect on interstate commerce).
- Morrison (2000): Violence Against Women Act Unconstitutional under Commerce Clause (preventing the rape and abuse of women does not have an effect on interstate commerce).
- Raich (2005): Controlled Substances Act Constitutional under Commerce Clause (private growth of marijuana does have an effect on interstate commerce).
- The Affordable Care Act Cases (2012): Individual Mandate is Unconstitutional under Commerce Clause (failure to purchase health insurance does not have an effect on interstate commerce).
Similarly, a few more sentences will be needed to address the Medicaid Expansion in a separate line of cases:
- Dole (1987): Enforcing minimum drinking age Constitutional under the Spending Power (withholding a small amount of federal highway funds for failure to comply is not coercive).
- New York (1992): Low-Level Radioactive Waste Policy Act Constitutional under Spending Power (imposing a penalty on states that ship their waste to other states is not coercive).
- Printz (1997): Brady Handgun Violence Prevention Act Unconstitutional under State Sovereignty principles (Congress cannot command Chief Law Enforcement Officers to conduct background checks on all gun purchasers).
- The Affordable Care Acts Cases (2012): Medicaid Expansion is Unconstitutional under Spending Power (threatening to cut-off all federal Medicaid funding from a state if they do not comply is coercive).
This decision is unlikely to effect future Congressional action – none of these previous Court opinions have been overruled. Additionally, it is difficult to predict this decision’s effect on the upcoming presidential election. Since Governor Romney pioneered this kind of plan in Massachusetts (Justice Ginsburg takes pains to point out the success of that program, and the flocks of the uninsured making special trips to Massachusetts) it is hard for him to claim that he will immediately repeal the ACA without sounding like a hypocrite. President Obama could easily shoot him down in a debate by quoting from Ginsburg’s opinion: “In coupling the minimum coverage provision with guaranteed-issue and community-rating prescriptions, Congress followed Massachusetts’ lead.” (Concurring at 12)
*Editor’s Note: Jack read the entire 180-page decision during his summer vacation, so be sure to read through his roadmap! When you’re done, see what your fellow students think!
*Editor’s Note #2: BLS has posted 2012-2013 insurance rates, and Jack’s predictions were spot on. Annual coverage for students 30 and under will be $1,811; for those over 30 it will be $2,022. Spring 2013 coverage only will be $1,092 and $1,217 respectively.
Inter Alia: June Legal News Recap
This month’s news is brought to you by the letter J. J is for June, John Roberts, and jobs. Three cheers for the letter J!
Brooklyn Law School
● BLS ranks 7th in unemployment. That is, if you trust math and statistics (I’m skeptical). [WSJ].
● Wedding Bells! [NYTimes].
● Moody’s assigns BLS’ bonds Baa1 rating. [Reuters]. (This might be a story in the future.)
● Worried about jobs? Grow a mohawk. Tats a plus. [NYTimes].
National
● FCC not happy about the Supreme Court’s decision about “indecency” fines for wardrobe malfunctions and provocative images. [LA Times].
● Free speech vs. abortion rights reaches Maryland court. [BusinessWeek].
● Wired.com recaps decisions from the Court’s 2011-2012 term. [Wired].
● Following Arizona ruling, local enforcement dubious about implementation of SB 1070. [NPR].
New York
● City firefighter discrimination case continues in 2nd Circuit Court of Appeals. [Reuters]
● $40 million hate crime suit dismissed for improper service. [WashingtonPost]
● Peter Madoff pleads guilty to fraud charges. [NYTimes].
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Boyan Toshkoff,’14, also contributed to this list
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