The Supreme Court’s Health Care Reform Decision: What It Means To Wisconsin Providers

July 6, 2012

As we reported in a prior e-Alert, last Thursday, the United States Supreme Court issued its most anticipated opinion in years and upheld most of the 2010 health care reform laws. Since then, you cannot turn on any of the major news networks without hearing debate about where we go from here and what the decision means. It is difficult to predict where the political process will take us. For now, here is what we know:

The ruling affirmed the constitutionality of the individual mandate, which requires nearly all Americans to obtain health insurance or pay a penalty. The Court found this provision constitutional on the grounds that it is a tax on those who do not have health insurance. The Internal Revenue Service will impose a penalty that will be assessed and collected in the same manner as any other tax penalty.
The Court found the penalty on states who fail to extend Medicaid coverage to be unconstitutional. Each State will now be able to choose whether or not to participate in the Medicaid expansion.
The Court upheld the remainder of the Affordable Care Act in its entirety. This lifts some of the uncertainty that previously existed over items such as Accountable Care Organizations, mandatory compliance programs, expanded fraud authority, mandate on employers with over 50 employees, pre-existing condition exclusions, lifetime and annual limits on essential benefits, and Medicaid expansion.

It is uncertain how Wisconsin will exercise some of the discretion that it now has under the Supreme Court decision. Wisconsin will now be able to choose whether to participate in the Medicaid expansion program. If Wisconsin declines to participate, it will not be subject to a penalty other than loss of the revenues that are attached to program expansion. Governor Walker has not specifically stated that Wisconsin will opt out, but he has reaffirmed that Wisconsin will take no action to implement the federal health care law now. Walker has said he hopes that after November, a new President and Congress will repeal the law, saying it “would require a majority of people in Wisconsin to pay more money for less health care.”
The second uncertainty is whether Wisconsin will now move to establish the health care exchange required by the health care reform act. Governor Walker has also indicated that Wisconsin will not begin to set up an insurance marketplace, referred to as an exchange, until after the November elections. The plan for an exchange is due to the federal government by January 2013. The Court’s decision means that the mandate on the states setting up a health care exchange remains. If a state fails to set up an exchange, the Federal government can take over the process in the state. It is possible that we could see political posturing over the creation of exchanges.
Ruder Ware will be releasing a series of topic specific blogs, articles and e-Alerts on some of the requirements of the Affordable Care Act and what providers should do to comply with the requirements of the law now that the Supreme Court has spoken.
Check our blog at for more frequent updates. If you have any questions about the Affordable Care Act, the Supreme Court’s decision, or any other health care issues, please contact John Fisher, CHC, CCEP, the author of this article, or any of the attorneys on the Health Care Focus Team of Ruder Ware.

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This document provides information of a general nature regarding legislative or other legal developments, and is based on the state of the law at the time of the original publication of this article. None of the information contained herein is intended as legal advice or opinion relative to specific matters, facts, situations, or issues, and additional facts and information or future developments may affect the subjects addressed. You should not act upon the information in this document without discussing your specific situation with legal counsel.

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