Supreme Court Won’t Hear Obamacare Medicare Cuts Lawsuit

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The Supreme Court decided Monday not to take up a case against an Obamacare panel often referred to as a “death panel,” an advisory board charged with cutting Medicare costs, falling back on a lower court’s decision that the challenge was premature.

The Court will not hear Coons v. Lew, a case brought by the conservative Goldwater Institute which in part challenges the constitutionality of the Independent Payment Advisory Board. But the merits of the case haven’t yet been decided — the decision is a sign that challenges to the panel are “premature” because it’s not yet in action. While a district court initially upheld IPAB’s constitutionality, the Ninth Circuit Court of Appeals ruled in 2014 that the challenge was “unripe” and vacated the district court’s decision to uphold it. The Supreme Court’s decision on Monday not to take up the appeal to the Ninth Circuit’s ruling will allow the board to take action in the future, but the door is still open to further court challenges once IPAB is assembled.

Another one of the most contentious parts of Obamacare, IPAB is a fifteen-member panel created to control Medicare costs. What would seem to be a mundane panel became infamous after being deemed a “death panel” by some Republicans. But IPAB hasn’t yet been assembled. It will take action when the annual increase in Medicare costs is growing faster than overall price growth and medical price growth. Only then can IPAB act to control costs — typically through cutting payments to doctors and hospitals.

That power has led to vehement opposition from Republicans, who argue that lowering payments will keep doctors from accepting Medicare payments, effectively making it more difficult for Medicare customers to access care.

“Although it is prohibited from “rationing,” that term is nowhere defined in the Affordable Care Act,” then-Senator Tom Coburn and Rep. Phil Roe wrote in support of the lawsuit in The Wall Street Journal in December. “Hence IPAB can control costs by lowering physician reimbursements — thus driving more doctors away from treating Medicare patients — or by reducing the services eligible or reimbursement. In other words, by rationing care.”

Coburn and Roe, both physicians themselves, signed onto an amicus brief with several other lawmakers asking the Court to take up the case.

Congress’s ability to counter the independent panel’s decisions is slim. The panel’s so-called recommendations automatically become law if Congress does not vote to stop them; what’s more, Congress can only reject the proposals if their plan produces the same or greater savings. IPAB’s decisions aren’t subject to review by the courts, either.

While many lawsuits against Obamacare provisions are seen are seen as partisan, IPAB’s consolidated power has attracted criticism from those on the right and the left. Timothy Jost, a law professor and Obamacare supporter, wrote in 2011 that the panel’s “transfer of power to the executive is troubling” and suggested a constitutional challenge may be valid.

It’s possible challenges to the board could arise again once IPAB is activated.

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