This morning, the United States Supreme Court upheld the Patient Protection and Affordable Care Act (“ACA”) in its entirety. In a 5-4 ruling, the Court held that the most controversial portion of the ACA, the individual mandate, was constitutional as being within Congress’s power under the Taxing Clause. Chief Justice Roberts wrote the majority opinion, joined by Justices Ginsburg, Breyer, Sotomayor, and Kagan. Justices Scalia, Kennedy, Thomas, and Alito dissented. The Court’s decision means that all portions of ACA, including the Physician Payments Sunshine Act (section 6002) and the Prescription Drug Samples Transparency Act (section 6004) remain in effect.
After months of waiting for the Court’s ruling, the Court arrived at what most would consider a surprising decision, for three main reasons. First, the individual mandate was upheld. Many “experts” had predicted that the mandate would be struck down by the conservative members of the Court. Second, Chief Justice Roberts, appointed by President George W. Bush and considered a solid conservative vote, broke ranks with the other conservative justices and instead joined with the more liberal justices to uphold the mandate. Third, it was expected that the individual mandate would either be struck down or upheld on the basis of the Commerce Clause. However, the five-member majority ruled that the individual mandate was constitutional under the Taxing Clause. On that point, the majority, with the exception of Chief Justice Roberts, would have held that the Commerce Clause authorized the individual mandate. Chief Justice Roberts was of the view that the individual mandate could not be sustained under the Commerce Clause, a point with which the dissenting justices agreed. Ultimately, the Commerce Clause issue became moot because five justices held that the individual mandate could be upheld under the Taxing Clause.
In addition to its ruling on the individual mandate, the Court held, as a threshold matter, that it had jurisdiction to consider the case and that the Anti-Injunction Act did not bar the suit. With respect to ACA’s Medicaid expansion, the Court determined that it was unconstitutional in that it threatened the States with the loss of their Medicaid funding if they did not comply with the expansion. The Court remedied that violation, however, by ruling that the Secretary of the Department of Health and Human Services cannot enforce that penalty provision of ACA.
In concluding the majority opinion, Chief Justice Roberts stated that “[t]he Framers created a Federal Government of limited powers, and assigned to this Court the duty of enforcing those limits. The Court does so today. But the Court does not express any opinion on the wisdom of the Affordable Care Act. Under the Constitution, that judgment is reserved to the people.” In the days to come, we can expect to see “the people” continuing their heated and passionate debate over the wisdom of ACA, as well as the wisdom of the Court’s opinion. Despite that debate, the Court’s ruling is clear, as is its impact on the life sciences industry: ACA remains in full force and effect, and companies must comply with all portions of it, including the Physician Payments Sunshine Act and the Prescription Drug Samples Transparency Act and their implementing regulations.
Click here for text of the full ruling.
Porzio, Bromberg and Newman, P.C.