Fringe Benefits News: All News
During March 26-28, the U.S. Supreme Court took up the constitutionality of the Affordable Care Act. The first day was spent addressing the procedural issue of whether the Court should dismiss the case as not yet ready for decision (it probably won’t dismiss). On the second day, the Court aggressively questioned the Act’s challengers and defenders. The issue was whether the federal government could properly exercise its commerce clause powers to mandate that individuals purchase health insurance after 2013 as the Act provides, or incur a penalty.
The Court appeared to be split along its liberal and conservative wings as to whether the mandate was constitutional, with the conservative wing favoring rejection of the law. Justice Anthony Kennedy, as the likely swing vote, seemed to lean toward the conservative position.
A rejection of the mandate could have fatal consequences for the entire Act. The last day of argument was dedicated partly to the question of whether the Court should strike down the entire Act if the mandate is invalidated. The liberal wing appeared to support retention of those parts of the Act unrelated to the mandate, whereas the conservative wing appears to support complete rejection of the Act. Justice Kennedy at times seemed sympathetic to both positions.
The Court should issue its decision in late June of 2012. Many observers on both sides of the issue acknowledge that the Court seems far more likely to invalidate the mandate than was estimated just months ago.
The outcome of this case is of great consequence to all of FCE's clients. Until it is decided, however, FCE will continue to assist its clients with Affordable Care Act compliance, focusing on those requirements that take effect earlier rather than later. Should you have any questions about the challenge to the Act and how it might affect your plan, please email FCE Chief Actuary Lou Kent at email@example.com.