U.S. Supreme Court Validates the Affordable Care Act (ACA).
After much anticipation, the Supreme Court issued its decision on the various legal challenges to the Patient Protection and Affordable Care Act (“PPACA” or simply “ACA”) on Thursday, June 28. Their ruling upheld the constitutionality of the law, and the only change to the law is a tweak on the rules surrounding the expansion of Medicaid.
The primary legal challenge against the ACA dealt with the requirement that every individual in the U.S. purchase health insurance starting January 1, 2014 or pay a penalty (known as the “Individual Mandate”). The Court decided in a 5-4 vote that the Individual Mandate is a constitutional exercise of Congress’ power to levy taxes. The two remaining challenges only applied if the mandate was found to be unconstitutional, and therefore are now irrelevant.
Impact on Employers
Employers were largely removed from the question on the mandate, as it was directed towards people who were uninsured, not those employees who have benefits from their employer. The decision is a clear signal that it’s “full steam ahead” as far as employers are concerned. ACA compliance efforts currently underway should continue as they have been.
Employers should anticipate, however, a new wave of regulations from the various federal agencies that will run and enforce the ACA will be forthcoming. In light of the January 1, 2014 deadline for full implementation, much work remains to be done. The agencies most likely have been holding back on issuing regulations in anticipation of the decision by the Supreme Court. Now that the decision is made, they can move back into providing needed guidance.
What Happens Now
While the legal challenges to the ACA appear to be over for now, the upcoming election may still alter the future of Health Care Reform, and certainly as the ACA gets closer to full implementation there will be tweaks to the rules. Assurance will keep you fully informed on important developments with the ACA and is planning on holding a series of webinars later this summer to review compliance action steps employers will need to take in 2013 and beyond.