An overview of the individual mandate, Medicaid expansion and dates impacting healthcare providers
On June 28, 2012, the United States Supreme Court released its highly anticipated decision on the constitutionality of the Patient Protection and Affordable Care Act (ACA).
The Supreme Court answered two key questions:
- Is the ACA’s individual mandate for Americans to obtain health insurance coverage constitutional?
- Is the ACA’s Medicaid expansion constitutional?
Yes, the individual mandate for Americans to obtain health insurance coverage is constitutional under Congress’s power to “lay and collect [t]axes.”
“[T]he mandate need not be read to declare that failing to [obtain health insurance coverage] is unlawful. Neither the Affordable Care Act nor any other law attaches negative legal consequences to not buying health insurance, beyond requiring a payment to the IRS.”
Yes, the Medicaid expansion under the ACA is constitutional, but the federal government is limited with regard to withholding Medicaid funding.
“Nothing in [the Supreme Court’s] opinion precludes Congress from offering funds under the Affordable Care Act to expand the availability of healthcare, and requiring that States accepting such funds comply with the conditions on their use. What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding...[The Secretary of Health and Human Services can] withhold all ‘further [Medicaid] payments...to the State’ if she determines that the State is out of compliance with any Medicaid requirement, including those contained in the expansion...In light of the [Supreme] Court’s holding, the Secretary [is precluded from] withdraw[ing] existing Medicaid funds for failure to comply with the requirements set out in the expansion.” Key effective dates impacting healthcare providers
- October 1, 2012: ACA establishes a hospital Value-Based Purchasing program (VBP) that provides financial incentives to hospitals to improve the quality of care.
- October 1, 2012: ACA implements a series of changes to standardize billing through the use of electronic exchange of health information.
- January 1, 2013: ACA establishes a national pilot program to encourage hospitals, physicians and other providers to work together to improve the coordination and quality of patient care through payment bundling.
- January 1, 2013: ACA requires states to pay primary care physicians no less than 100 percent of Medicare payments in 2013 and 2014 for primary care services.
- January 1, 2015: ACA ties physician payments to the quality of care the physician provides -- payments will be modified so that physicians who provide higher value care will receive higher payments than physicians who provide lower quality care.
For additional information on the ACA, please reference our Healthcare Reform page.
For additional information on what the ACA means for your business, please join us for our roundtable webinar on July 12, 2012 from 12:00 p.m. -- 1:00 p.m. EDT: "The Supreme Court has spoken: What does the Affordable Care Act decision mean for your business?"
Roundtable: Click here if you are located in Northeast Ohio.
Webcast: Click here if you are located outside of Northeast Ohio.
For more information, please contact:
Richard S. Cooper216.348.5438
Rachel H. Yaffe312.642.2856