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Health Law and the Role of the Courts

Health Law and the Role of the Courts. Professor Allison K. Hoffman May 7, 2019. What is Health Law and Why Should Doctors Care?. Guides the relationship between doctors and patients, increasingly so over time. For example, health law includes:

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Health Law and the Role of the Courts

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  1. Health Law and the Role of the Courts Professor Allison K. Hoffman May 7, 2019

  2. What is Health Law and Why Should Doctors Care? • Guides the relationship between doctors and patients, increasingly so over time. For example, health law includes: • Rules on duties of care (medical malpractice, informed consent, privacy/confidentiality, abandonment) • Antidiscrimination laws • Licensure and scope of practice laws • Regulates the business of health care • Insurance regulation (including Medicare, Medicaid) • Antitrust • Fraud and abuse • Sets ethical rules/guidelines (e.g., end of life, abortion, etc.)

  3. Early on, the Law Deferred to the Medical Profession A century ago, there was limited interaction between the medical profession and courts; limited legal obligations and extensive immunities and shields • No duty to care • Professional custom and locality rule as shield against liability = protective of doctors • Learned profession exemption from antitrust law (notion of deference to “noble professions”) Medicine regarded not as a business subject to industry regulation but as an altruistic calling

  4. The 20th Century Evolution

  5. Evolution of Health Care Delivery and Financing… • Rise of “for profit” hosp. MDs as: • Employees (residents, pathologists, radiologists, ER MDs) • Med. Staff (2/3 of MDs) • Hospitals = almshouses for sick-poor. Often formed by religious orgs. 1930s: Formal Med. Ed. 1900: AMA gains traction 1800s 1900 2000 1965: Medicare & Medicaid 1985: EMTALA MDs as solo family practitioners. 1940s-50s: Group health insurance 1846: Ether 1867: Anti-sepsis 1895: x-ray

  6. As the Nature of Medicine Changes, so Does the Role of the Law … • Medicine evolves into a highly regulated industry • Scrutiny of physician/patient relationship and increase in legal obligations • Rise of medicine as a business, with attendant shifts in law (antitrust, fraud, conduct of tax-exempt organizations, enforcement of corporate law principles) Courts called on to enforce laws related to all of the above and to take “judicial notice” of social evolution

  7. … and the Level of Regulation Intensifies • Exceptions to the “no duty of care” principle • EMTALA and emergency care • Patient abandonment • Rules for professional and institutional liability • Informed consent, • Privacy and confidentiality (common law duties and HIPAA) • Loss of the “learned profession” exemption under federal antitrust law, expansion of enforcement activities (1975) • Creation of federal health insurance programs (Medicare and Medicaid) & conditions of participation in 1965 • Scrutiny of tax-exempt organizations • Federal & state laws aimedf at curbing health care fraud and authorizing qui tam actions (false claims; Stark, antikickback)

  8. Health “Law” is Multifaceted • It takes many forms • Legislation • Regulation • Executive Orders • Judicial Decisions • All levels of government actively regulate • Federal (e.g., Medicare/Medicaid, ACA, EMTALA, Stark/antikickback, ADA, CON, HIPAA, etc.) • State (e.g., licensure, Medicaid, referral, privacy • Local (2800 local health agencies)

  9. The Modern ERA: Patient Protection and Affordable Care Act (ACA) and beyond

  10. ACA Signed into Law March 23, 2010 After Nearly a Century of Failed Efforts A Big F***ing Deal

  11. What Does the ACA Do? • Title I – “Quality, Affordable Health Care Coverage for All Americans” • Title II – “Role of Public Programs” • Title III – “Improving the Quality and Efficiency of Health Care” • Title IV – “Prevention of Chronic Disease and Improving Public Health” • Title V – “Health Care Workforce • … • Title IX – “Revenue Provisions” • Title X – Catch all Revisions Health Insurance Reform – Creates System of Shared Risk Health Care Delivery and Public Health Pilots and Investments

  12. ~50 Million Uninsured Were Chief Motivation for Health Reform Total = 303.3 million NOTE: Includes over age 65. Medicaid/Other Public Incl. Medicaid, CHIP, other state programs, military coverage, and dual eligibles SOURCE: Kaiser Commission on Medicaid & the Uninsured & Urban Institute estimates based on the Census Bureau's March 2010 CPS.

  13. PPACA Increased # Insured through Complex Set of Path-Dependent Policies Regulated Private Ins. Markets & Exchanges (access to private ins.) Subsidies + Mandates (increase participation) Expansion of Public Coverage (access to public ins.) • Process (access) • New rules for issuing individual coverage (e.g., guaranteed issue, community rating, no preexisting cond. exclusions) • Exchanges • Substance (quality) • Essential Health Benefits • “0” cost sharing for preventive care • No annual/lifetime limits; cost sharing limitations • Expansion of Medicaid to anyone earning under 138% of FPL (in states that expand programs) • Removal of categorical eligibility • Closing of donut hole PPACA Free Market Fully Public

  14. The Trump Era Marks a Slow Erosion of the ACA • The failure of “Repeal and Replace” in Congress in Summer 2017 left the ACA largely in tact, but vulnerable • Tax legislation repealed individual mandate starting in 2019 • Many ACA provisions altered by executive order and agency regulation. These regulations all face legal challenges (to be discussed) • Regulations extend exemption to providing contraception coverage to moral objectors (not just religious), to any employer, and without notice • Individual health insurance and coverage weakening through, e.g., • 2019 Payment notice (e.g., EHB flexibility) • Association Health Plans Department of Labor Rule • Short-Term Plans up to 365 days under DHHS rule • Medicaid § 1115 waivers • Section 1557 - regulation says sex discrimination includes sexual orientation and gender identity. In legal challenges, TX says not okay; other courts say okay. New rule pending. Major issue: access to services for transgendered.

  15. health law in the Courts

  16. Major Health Law Cases Heard by the U.S. Supreme Court 2010-2018 (1 of 2)

  17. Major Health Law Cases Heard by the U.S. Supreme Court 2010-2018 (2 of 2) • King v Burwell (2015) • Is it plausible that the ACA intended for premium tax credits to be available in states that did not establish and operate their own Exchanges under the ACA, but instead relied on the Federal Exchange? Answer: No, credits available. • Whole Women’s Health v. Hellerstedt(2016) • Does a Texas law that requires MDs at clinics to have hospital admitting privileges within 30 miles of the clinic and for clinics to have facilities comparable to an ambulatory surgical center impose an undue burden on women who seek abortions? Answer: Yes, law is unconstitutional. • Gobeille v. Liberty Mutual (2016) • Are state req’s to report claims data “preempted” by federal law (ERISA)? Answer: yes, states can’t require employer health plans to report claims data. • House v. Azar (formerly Burwell, Price, Hargan) (not S.C.) • Did the Obama Administration act beyond constitutional powers by spending money on cost-sharing subsidies that Congress had not explicitly appropriated?

  18. Current Litigation in Progress: Just a Sampling

  19. NFIB v. Sebelius • Holding Individual Mandate: Constitutional under Congress’ “tax and spend” power • Holding Medicaid: Requiring expansion to 133% of federal poverty unconstitutionally coercive (Chief Justice Roberts: loss of all existing funding for failure to expand is “like gun to the head”) • But penalty severable, which means states can keep pre-ACA Medicaid programs or expand

  20. Current Status of State Medicaid Expansion Decisions: January 2019 (37 adopted) NOTES: Current status for each state is based on KCMU tracking and analysis of state executive activity. *AR, IA, IN, MI, MT, NH and PA have approved Section 1115 waivers. Coverage under the PA waiver went into effect 1/1/15, but it has transitioned coverage to a state plan amendment. Coverage under the MT waiver went into effect 1/1/2016. LA’s Governor Edwards signed an Executive Order to adopt the Medicaid expansion on 1/12/2016, but coverage under the expansion is not yet in effect. WI covers adults up to 100% FPL in Medicaid, but did not adopt the ACA expansion. See source for more information on the states listed as “adoption under discussion.” SOURCE: “Status of State Action on the Medicaid Expansion Decision,” KFF State Health Facts, updated January 12, 2016. http://kff.org/health-reform/state-indicator/state-activity-around-expanding-medicaid-under-the-affordable-care-act/

  21. The Next Era of Medicaid: the Situs for a Major Moral and Legal Battle • On one hand, work & “community engagement” § 1115 Waivers • CMS State Medicaid Dir. Letter Jan. 11, 2018 invited work demonstrations; no prior administration would allow • CMS approved KY demonstration one day later (Jan. 12), followed by AR, IN, NH, AZ, MI, OH, UT, WI. Kentucky Demonstration, for example, includes: • Work/community engagement requirements (80 hours per month) • Eligibility restrictions (premiums, lock-out periods, elimination of retroactive eligibility, and reporting requirements) • Elimination of non-emergency medical transport • Increased cost-sharing for non-emergency ER use • On the other hand, state ballot initiatives for full expansion • Ballot measure passed in Maine. Gov. LePage resists implementation but fails • Full expansion passed in Idaho, Nebraska, Utah • Utah legislature passes scaled back version that is being challenged legally

  22. Medicaid Work Waiver Challenges (Stewart v. Azar; Gresham v. Azar, etc.) • Legal questions • Substance: are waivers consistent with objective of Medicaid statute (medical assistance to eligible pops.)? • Process: did CMS engage in a reasoned decision process on the above or was it arbitrary and capricious (Chevron)? • J. Boasberg struck down KY, AR Waivers on Mar. 27 • Bottom line: DHHS did not explain how large losses in coverage were consistent with objectives of Medicaid (est. 95K in KY; 18K plus lost coverage in 1st year in AR) • On expedited appeal to DC Circuit; oral arguments this fall

  23. Contraception Cases: Hobby Lobby v. Burwell, Zubik v. Burwell & CA v. Azar, PA/NJ v. Trump • ACA women’s health amd. (§ 2713) req’s coverage of FDA-approved contraception “as prescribed” for women with no cost sharing • Includes counseling, insertion, and removal • Services related to follow-up & mgt. of side effects, counseling for continued adherence, & device removal • Applies to all new private plans (individual and employer) but exempts “grandfathered” plans • Fine on emp. for non-compliance = $100/enrollee /day • Est fine for Hobby Lobby = $475M/year (13K employees); note fine for not providing insurance = $26M/year • N/p houses of worship are exempt; accommodation made for non-profit religiously-affiliated orgs (insurer or TPA must pay for coverage if org indicates it won’t provide it). Mandatory for all secular N/p and f/p orgs.

  24. Religious Freedom Restoration Act of 1993 • Provides that the government “shall not substantially burden a person’s exercise of religion” unless that burden is the least restrictive means to further a compelling governmental interest

  25. Legal Analysis of the Supreme Court Ruling on Hobby Lobby Burden on Employer Burden on Government 3. 2. 4. 1. YES YES NO No Ruling YES NO NO NO Does not violate RFRA Violates RFRA SCOTUS Remanded Zubik v. Burwell (Round 2) for reconsideration of Prong 4 SOURCE: Kaiser Family Foundation.

  26. Round 3: State AG litigation • DHHS, Treasury & DOL rule broadens exemption (religious & moral, all employers, no notice required) • As many as 126K women affected; $63.7M expense • Litigation brought by • ACLU, SEIU-UWH on behalf of members • Various state Attorneys General who argue that rules create expense for states, who will provide coverage • Two judges issued injunctions (CA & PA - nationwide) • Procedural problems; notice and comment too late • Exceeded scope of agency authority under ACA by carving people out from statutory requirement • Not mandated by or allowed by RFRA

  27. Whole Women’s Health v. Hellerstedt (2016) • 2 dozen clinics closed after Texas House Bill 2 passed • 5-3 ruling held that the law posed an “undue burden” (Casey v. Planned Parenthood, 1991)on women’s constitutional right to an abortion (Thomas, Alito, and Roberts dissented; Kennedy 5th vote) • Implications • Whole Women’s Health Clinic in Austin, TX reopened, 3 years after closing. But most clinics that shut down have not reopened. • Precedent for challenges to TRAP (Targeted Regulation of Abortion Providers) Laws • But future uncertain with Kavanaugh confirmation

  28. Texas v. U.S. • Parties: 20 Republican state attorneys general and governors, plus 2 people, filed suit (again) against the ACA • Interveners: AGs from CA other states defend law • Claim: Individual mandate is unconstitutional following with associated tax penalty reduced to $0 in tax bill. If mandate is unconstitutional, entire law must go. • DOJ response: agreed (!!!) • First : only consumer protections provisions that are intimately tied to IM must go (guaranteed issue, community rating, ban on pre-existing condition exclusion clauses) • Now: all law must go • 5 DOJ attorneys have resigned over case • Judge O’Connor said unconstitutional in a highly unusual opinion; on appeal to 5th Circuit

  29. Questions?

  30. Unused

  31. Views on ACA Have Vacillated Since Passage; Approval at All-Time High in Early 2018

  32. Misperceptions Run Rampant Do you think each of the following will be better off or worse off under the health reform law, or don’t you think it will make much difference? The uninsured Better off Lower income Americans No difference The country as a whole Seniors, that is those ages 65 and older Worse off Your state Don’t know/Refused People currently covered by Medicaid Middle class Americans You and your family Source: Kaiser Family Foundation Health Tracking Poll (conducted May 12-17, 2011)

  33. Figure 15 Funding Health Reform, 2010-2019 Federal savings New revenues Total Cost = $938 B Savings to Federal Deficit = $124 B Source: Kaiser Family Foundation, Data from Congressional Budget Office, 2010

  34. King v. Burwell: Key Background Facts • Subsidies available to people earning 100-400% of the Federal Poverty Level (FPL) without adequate/affordable employer coverage (FPL = $11,880-$47,520 for an individual in 2016) • Cost sharing reductions available to those earning 100-250% FPL ($11,800-$29,700 in 2016)) • 87% of people who selected a plan in a Federally-run marketplace received subsidies

  35. What Was at Stake?: King v. Burwell

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