Compliance Confidence
United States Supreme Court Agrees to Hear Appeal on ACA Preventive Service Requirements
United States Supreme Court Agrees to Hear Appeal on ACA Preventive Service Requirements
The upcoming Supreme Court case is the latest flare-up in a long-running dispute over the legality of Affordable Care Act provisions that compel insurers to cover preventative healthcare services.
The United States Supreme Court agreed to hear an appeal that challenges the Affordable Care Act’s (ACA) coverage of preventive services. Originally heard in a Texas district court, a federal judge issued a ruling on the latest legal challenge to the ACA in Braidwood Mgmt. Inc. v. Becerra (Braidwood). The ruling stated that nongrandfathered group health plans and insurers no longer have to cover recommended preventive services without cost sharing. The United States Preventive Services Taskforce (USPSTF), a panel of experts in primary care and prevention, makes these recommendations, which are then often adopted by HHS. The ruling also stated that employers with religious objections that sponsor health plans no longer have to cover PrEP HIV medications.
Background on Preventative Care Coverage Requirements
Section 2713 of the Public Health Service Act (PHS) requires that non-grandfathered group health plans and health insurance issuers that offer non-grandfathered group or individual health insurance coverage provide benefits for and prohibit cost-sharing requirements to:
- Evidence-based items or services that have a rating of “A” or “B” as currently recommended by the USPSTF except 2009 regulations regarding breast cancer screening, mammography, and prevention.
- Immunizations for routine use in children, adolescents, and adults that have a recommendation from the Advisory Committee on Immunization Practices of the CDC
- Evidence-informed care for infants, children, and adolescents found in the comprehensive guidelines supported by the Health Resources and Services Administration (HRSA)
- Preventive care and screening for women in a comprehensive guideline supported by the HRSA
The Braidwood Challenge to Preventative Service Coverage
The plaintiffs in Braidwood claimed that the “Appointments” and “Vesting” clauses of the U.S. Constitution and the “nondelegation” doctrine bar the USPSTF and other groups from making recommendations. The federal court agreed and said all coverage requirements related to the “A” or “B” rating recommendations of the USPSTF are vacated. On appeal, the Fifth Circuit Court of Appeals ended a nationwide injunction while the case continues on appeal.
DOL FAQs After Braidwood
Following the ruling, the Department of Labor (“DOL”) issued FAQs that clarified that plans and issuers must still continue to cover items and services with an “A” or “B” rating recommended or updated by UPSTF prior to March 23, 2010, without cost sharing. While the Braidwood decision is in effect, items and services with an “A” or “B” rating on or after March 23, 2010 no longer have to be covered without cost sharing.
For employers that sponsor plans where state law requires coverage similar to the provisions vacated by Braidwood, the DOL states that Braidwood only impacts federal law. Accordingly, employers should continue to follow the laws of their respective states. At a minimum, legal counsel should be consulted before any cost sharing provisions are added.
Whether or not plan sponsors or issuers add cost sharing to these vacated requirements, the DOL still considers these services as preventative care. For high deductible health plans, this means related HSA eligibility will not be impacted if cost sharing is added.
What Will SCOTUS Do?
The Braidwood appeal comes at a time when the majority of the Supreme Court has shown themselves skeptical of the power of federal agencies. The recent decisions in Loper Bright Enterprises v. Raimondo and Corner Post, Inc. v. Board of Governors of the Federal Reserve System opened the door to increased litigation over all federal regulations, including those that impact employer group health and retirement plans.
In Loper Bright, the court overturned what is commonly knows as the Chevron doctrine. The Chevron doctrine helped courts determine whether a federal regulation was enforceable based on the scope of authority that Congress delegated to the agency. If the federal law behind a regulation was unclear, the Chevron doctrine required federal judges to uphold the administrative agency’s interpretation of the statute, as long as their interpretation was reasonable. Now, federal judges must rely on their own interpretation of ambiguous laws and not give any deference to the opinions of agency policy experts. In its decision, the Court stated that this new standard would apply prospectively and not impact preexisting cases that relied on Chevron. However, that portion of the ruling was short lived.
In Corner Post, the Court determined that the clock on the six-year statute of limitations to challenge a regulation doesn’t start ticking until a plaintiff has been “adversely affected or aggrieved by agency action” under the Administrative Procedure Act. In Corner Post, the plaintiff company did not exist at the time the federal agency finalized its rule, therefore they could not be “adversely affected” when the regulation was finalized. Therefore, this plaintiff had six years to challenge the regulation from the date that they were personally impacted.
In practice, Corner Post put nearly every federal regulation at risk of constant challenge. Because a successful challenge can completely overturn a regulation, one successful plaintiff can impact an entire industry.
The Biden administration appealed the district court’s Braidwood ruling. However, it is unknown whether the Trump administration will continue to defend the law. If not, it is possible that the Supreme Court will appoint another attorney to defend the requirements.