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Lack of Supreme Court Ruling on Health Care Reform Keeps Experts Guessing

Speakers at overflow sessions of the Society for Human Resource Management's 64th annual conference detail the likely scenarios that could occur when the justices rule late this week.

June 26, 2012

PowerPoint slides were shuffled and notes edited June 25 as speakers addressing health care reform at the Society for Human Resource Management's 64th annual conference reacted to the U.S. Supreme Court waiting to make a ruling on the individual mandate, a key provision of the Patient Protection and Affordable Care Act.

Pundits and politicos expected the high court to issue its decision June 25, the first full day of SHRM's conference in Atlanta. But the ruling never came. The ruling is expected June 28, the day after the gathering ends.

The sessions on President Barack Obama's landmark health care reform law were among SHRM's best-attended talks, including Aetna executive Kay Mooney's June 25 seminar "The Changing Landscape of Health Care Reform."

"Good news for me," she said to a standing-room-only crowd that morning, referring to the absence of a decision. "I don't have to flip through presentations 4, 5 and 6. It's nice to have a full room, but I wonder how many people will leave once they hear the ruling hasn't come down."

Mooney highlighted possible rulings and their impact on employers, including the law being upheld in its entirety, which would mean that implementation efforts would continue. Another scenario is that the justices will rule the individual mandate unconstitutional and the entire law is tossed out.

Even if that happens, Mooney says, certain provisions, such as 100 percent coverage of preventive care services and subsidies for low-income families that want to purchase health care on a state-based health insurance exchange will remain.

The exchanges, a key feature of the legislation, would expand coverage to 32 million Americans who are uninsured. The law requires states to implement these new health insurance marketplaces by 2014. Massachusetts and Utah have already established exchanges, and several states have signed legislation to establish them.

According to Mooney and others, the worst-case scenario would be if the mandate is struck down and deemed severable from the law, meaning that the rest of the law would stand. "People would wait to buy coverage until they need it and that's not a viable recipe," Mooney said. "Additional legislative activity would have to continue if that happened, and will Congress take action before the election? Conventional thinking is no. That option would create a lot more uncertainty."

HR consultant Gary Kushner says that if he were a gambling man, the court will uphold the entire act by a 6-3 decision with Chief Justice John Roberts in the majority. Kushner bases his prediction on a 2011 ruling by the U.S. Court of Appeals for the District of Columbia Circuit to uphold the constitutionality of the mandate. The senior judge ruling on the case was a noted conservative thought leader, Kushner says.

"We had a number of courts of appeal issuing decisions with a wide range of appeals court decisions," he said. "But one of the most impressive majority opinions was written was by Judge Laurence Silberman in the D.C. Court of Appeals. Historically, he has taken a more limited view of the government's powers, but he sided with the majority upholding the constitutionality of the act and wrote a very strong majority opinion. More importantly, Roberts has often been aligned with Judge Silberman."

However, the "safe bet," he said, was that the court would strike down the mandate by a 5-4 vote.

Whatever the court decides, Kushner, who drew an overflow crowd of more than 500 for his June 25 seminar "Health Care Reform Update: Six Things You Need to Think About (and Do) Now, said that "at the end of the day I expect that we in the HR world will have to deal with some or all of the remnants of the" Patient Protection and Affordable Care Act.

He urged HR practitioners to develop an employee communications plan.

"Most of your employees are very hungry for news about reform, but they're not getting their news from CNN or their newspaper; they're coming to HR," he said. "This is a golden opportunity for us to communicate the strategic value of our health plans. It's an amazing opportunity. Seize it."

For Juan Avila, HR manager for Coastal Construction Group in Miami, a firm with 203 employees, there are two questions on the minds of his employees.

"They want to know if the company will continue to provide health care benefits or not and will their kids be covered," he said. "No one is sure what will happen. We are all just waiting to see what the court decides."

Rita Pyrillis is Workforce Management's senior writer. Comment below or email editors@workforce.com.