Supreme Court Declines To Hear Lawsuit Challenging ACA’s IPAB

On Monday, the Supreme Court declined to hear Coons v. Lew, a case challenging the constitutionality of the Independent Payment Advisory Board created under the Affordable Care Act, Politico reports (Haberkorn, Politico, 3/30).

Background

IPAB is a 15-member panel of health care experts established under the ACA to make cost-cutting recommendations in Medicare annually if program spending exceeds a target growth rate of 3.03%. The recommendations would take effect unless Congress develops an equivalent alternative.

Although it was scheduled to convene in 2014, the panel was not required to make recommendations because the projected growth rate is 1.15%, according to CMS (California Healthline, 5/31/13). The Obama administration has not yet nominated any panel members (Shinkman, FierceHealthFinance, 3/30).

Lawsuit Details

Two Arizona residents -- Eric Novack, a physician, and Nick Coons, a business owner -- filed suit against the panel (Hurley, Reuters, 3/30). They argued that they would be harmed by any Medicare spending cuts recommended by the panel. The suit also argued that the panel violates the Constitution's prohibition against Congress delegating its responsibilities to other parties (Schencker, Modern Healthcare, 3/30).

In response to the challenge, the government said the Supreme Court has recognized that in order to function, Congress must delegate some of its powers. The government argued that doing so is legal as long as it is made clear how the delegated duties are to be performed (Schencker, Modern Healthcare, 3/26).

In August 2014, the 9th U.S. Circuit Court of Appeals dismissed the lawsuit, ruling that IPAB could not be reviewed by the courts because it had not yet been established or issued any recommendations. Further, the court in the August ruling said that 2019 is the earliest that IPAB could potentially take action reducing Novack's Medicare reimbursement, Reuters reports (Reuters, 3/30).

Given the earlier rulings, the Supreme Court's refusal was expected, according to Politico (Politico, 3/30).

Reaction

The Goldwater Institute, representing the plaintiffs, intends to challenge the IPAB once the board issues recommendations, Modern Healthcare reports. Christina Sandefur, a senior attorney at the Goldwater Institute, said, "This case is not dead; we're simply in a holding pattern" (Modern Healthcare, 3/30).