Maine Community Health Options v. United States
Maine Community Health Options v. United States | |
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Argued December 10, 2019 Decided April 27, 2020 | |
Full case name | Maine Community Health Options v. United States |
Docket no. | 18-1023 |
Citations | 590 U.S. ___ (more) 140 S. Ct. 1308 |
Case history | |
Prior |
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Holding | |
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Court membership | |
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Case opinions | |
Majority | Sotomayor, joined by Roberts, Ginsburg, Breyer, Kagan, Kavanaugh; Thomas, Gorsuch (all but Part III–C) |
Dissent | Alito |
Laws applied | |
Patient Protection and Affordable Care Act; Tucker Act |
Maine Community Health Options v. United States, 590 U.S. ___ (2020), was a
Background
The
The Republican Party had generally been against the ACA, and with the 2014 United States elections, gained controlled of the Senate while retaining control of the House of Representatives. Senator Marco Rubio introduced legislation in November 2013 to amend the ACA to repeal the Risk Corridor program, which he had described as "taxpayer-funded bailouts",[2][5][6] but which failed to pass. Rubio was able to successfully able to introduce a rider into the 2014 appropriations for the DHHS that prevented CMS from using other accounts to fund payments for the Risk Corridors program, effectively requiring it to be fiscally neutral.[7] In tallying the 2014 year-end funds, CMS found they had an approximate US$2.5 billion deficit in payments to under-performing insurers due to the new rider. CMS were forced to reduce payments that year on a pro rata basis, approximately down to 12.6% of the originally promised payments, with the expectation to pay the remaining owed funds from the profitable plan payments in 2015 and 2016.[8] A similar rider was introduced in the subsequent 2015 appropriations bill to limit the funds the CMS could use to pay out insurers,[9] and with 2015 also having another large deficit towards underperforming insurers, CMS could issue no 2015 payments and only cover a portion of the owed 2014 payments. A similar situation occurred in 2016, with yet another rider and another deficit. By the end of 2016, CMS estimated it still owed insurers over US$12 billion from the Risk Corridor program.[8] Over a dozen insurers were forced to declare bankruptcy as a result of the lack of payments.[10]
Some of the insurers that were owed money by the CMS sued the government for failure to pay. The Supreme Court case here is a consolidation of three cases from four different insurers: Maine Community Health Options, Moda Health Plan, Blue Cross and Blue Shield of North Carolina, and the Land Of Lincoln Mutual Health Insurance Company. All four had filed separate suits at the United States Court of Federal Claims under the Tucker Act, asserting that §1342 of the ACA held the government responsible to fulfill the payments promised by the Risk Corridor program. Of the four cases, only Moda Health had been given partial summary judgement that the government was still required to fulfill payments. All four cases were appealed to the United States Court of Appeals for the Federal Circuit which ruled in favor of the government in all three cases, in that the riders of the appropriation bills eliminated the responsibility of the government to fulfill the payments.
Supreme Court
All four insurers petitioned the Supreme Court to hear the case, which they certified in June 2019 for the 2019–2020 term, consolidating the three cases under Maine Community Health Options.[11] Oral arguments were heard on December 10, 2019, during which observed felt that a bi-partisan majority group of the Justices appeared to side with the insurers, asking questions that compared the Risk Corridor program and its equivalency to a typical business contract. Only Justice Samuel Alito appeared to side with the government's stance.[12]
The Court issued its decision on April 27, 2020. In the 8–1 decision, the majority ruled that the Risk Corridor program as defined in §1342 was an obligation for the government to pay the amount owed set by the predetermined calculation to the insurers, and that Congress improperly used appropriation riders to try to cancel this obligation. Further, the majority ruled that the insurers could bring a damages action in the Court of Federal Claims against the government under the Tucker Act. Justice Sonia Sotomayor wrote the majority which was joined by all but Justice Alito. Sotomayor wrote that their decision reflected "a principle as old as the nation itself: The government should honor its obligations."[13] Sotomayor affirmed that insurers "may seek to collect payment through a damages action in the Court of Federal Claims" via the Tucker Act.[14] Justice Alito wrote in the sole dissenting opinion that the majority's decision was "a massive bailout for insurance companies that took a calculated risk and lost" and that "This money will have to be paid even though Congress has pointedly declined to appropriate money for that purpose."[13]
References
- ^ Maine Community Health Options v. United States, 590 U.S. ___ (2020)
- ^ a b c d e Kliff, Sarah (January 27, 2014). "Here's the deal with the Obamacare 'bailout'". The Washington Post. Retrieved June 27, 2020.
- ^ Fact Sheet: ACA Risk-Sharing Mechanisms (PDF) (Report). American Academy of Actuaries. April 13, 2012. Retrieved June 27, 2020.
- PMID 26973861.
- Wall Street Journal. Retrieved June 27, 2020.
- Mario Rubio. November 19, 2013. Retrieved June 27, 2020.
- ^ Ferris, Sarah (November 24, 2015). "Rubio budget win is dealing heavy blow to ObamaCare". The Hill. Retrieved June 27, 2020.
- ^ a b Yurish, Amy (February 22, 2018). "Affordable Care Act Litigation in the Spotlight: The Risk Corridors Program". American Bar Association. Retrieved June 27, 2020.
- ^ DeBonis, Mike; Snell, Kelsey (December 16, 2015). "Here's what made it into Congress's big spending and tax bills". The Washington Post. Retrieved June 27, 2020.
- Salon. Retrieved June 27, 2020.
- ^ Marimow, Ann E.; Barnes, Robert (June 24, 2019). "Supreme Court strikes down violent criminal provision, rules against newspaper seeking food stamps data". The Washington Post. Retrieved June 27, 2020.
- ^ Millhiser, Ian (December 10, 2019). "Obamacare had an unusually good day at the Supreme Court". Vox. Retrieved June 27, 2020.
- ^ a b Liptak, Adam (April 27, 2020). "Supreme Court Rules for Insurers in $12 Billion Obamacare Case". The New York Times. Retrieved June 27, 2020.
- ^ Barnes, Robert (June 27, 2020). "Supreme Court rules for insurance companies in Obamacare lawsuit seeking billions". The Washington Post. Retrieved June 27, 2020.
External links
- Text of Maine Community Health Options v. United States, 590 U.S. ___ (2020) is available from: Justia Oyez (oral argument audio) Supreme Court (slip opinion)