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Volume XI, Number 217

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McDermottPlus Check-Up: June 18, 2021

Supreme Court declines to reach merits of Affordable Care Act individual mandate case. MedPAC and MACPAC issue new recommendations on familiar themes. Appropriations markups schedule announced.

States and Courts

U.S. Supreme Court Found No Standing for Plaintiffs in California v. Texas. In this case, two individuals and a group of states were challenging the constitutionality and severability of the ACA’s individual mandate tax penalty, which had originally required an individual to carry a minimum level of coverage or potentially pay a tax. In 2017, the Tax Cuts and Jobs Act reduced that penalty to $0, leading Texas to sue on the grounds that because the mandate was no longer raising revenue, it was no longer a tax, and therefore no longer a valid use of Congressional power. In a 7-2  majority opinion written by Justice Steven Breyer, the Court decided that none of the plaintiffs were able to show how they have been or would be injured by the now unenforceable mandate, and that they therefore lacked standing to bring the case. The majority concluded that the Court was incapable of providing any requested relief and ordered the lower court to dismiss the case. The possibility of ACA repeal had loomed large over the healthcare industry for many months. The decision takes some pressure off of Congressional stakeholders to act immediately to shore up coverage options. While this decision brings to a close the latest frontal assault on the Act, this may not end efforts to bring down the law through the courts. Many analysts viewed prior Supreme Court decisions as the final word on the law, only to see the law’s opponents concoct new theories and advance additional major assaults.

Congress

Medicare Payment Advisory Commission (MedPAC) Released June 2021 Reports to CongressMedPAC’s second report of the year included recommendations for Medicare Advantage benchmark reform and streamlining the Alternative Payment Model portfolio. Specifically, MedPAC called for a blended national-local benchmark to drive more efficient bidding among MA plans. It also made recommendations to improve APM performance by mitigating the effects of operating too many concurrent models. MedPAC also reported the results of a study of the role of private equity investment in healthcare. MedPAC did not make recommendations for PE in Medicare, but the panel did raise issues for further evaluation, including a need for increased transparency into organizational structures to facilitate accurate research on the impacts of PE ownership in healthcare. Other topics covered rural access and vaccine coverage.

Medicaid and Chip Payment and Access Commission's (MACPAC) Also Issued New Recommendations. MACPAC's recommendations focused on a broad array of topics, including pediatric and adult behavioral health, electronic health records adoption, specialty drugs and dual-eligible special needs plans. MACPAC suggested Congress increase rebates on drugs approved via accelerated approval by the U.S. Food and Drug Administration until it verifies clinical benefit. It also encouraged the U.S. Department of Health and Human Services (HHS) to look at how Medicaid funds can be used for a crisis continuum.

House Appropriations Markup Schedule Released. On Tuesday, House Appropriations Chairwoman Rosa DeLauro (D-CT) announced that subcommittee markups on the Labor, Health and Human Services (LHHS) appropriations bill would take place on July 12, followed by a full committee vote on July 15. The LHHS bill includes funding for all of HHS’ agencies including NIH, CDC, FDA, SAMHSA, and CMS. The House Majority aims to complete all 12 appropriations bills before the August recess.

Quick Hits

Next Week’s Diagnosis

The Senate Health, Education, Labor and Pensions Committee will hold a hearing on COVID-19 vaccination. House Energy and Commerce will hold a legislative hearing on using data to advance health equity.

© 2021 McDermott Will & EmeryNational Law Review, Volume XI, Number 169
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