Tuesday, July 3, 2012

Update on Physician Hospitals of America v. Sebelius

This is the case that was argued back on April 3 in the Fifth Circuit, in which there was a brief kerfuffle about whether the administration still respected the federal judiciary's authority to declare acts of Congress unconstitutional. The case actually has nothing to do with the individual mandate. Rather, the plaintiffs challenge ACA §6001, which extends the preexisting Medicare anti-kickback provisions to physician-owned hospitals. The provision is complicated, and it contains distinct grandfather provisions for hospitals operating or under construction as of 2010. Hospitals in violation of the provision are ineligible for Medicare reimbursement.

The plaintiffs challenged §6001 as a violation of the Takings and Due Process Clauses of the Fifth Amendment. What seems to remain on appeal is the claim that the regulation effectively amounts to a regulatory taking (or its equivalent).

Again, oral argument took place on April 3, and no doubt the Fifth Circuit panel was waiting to see whether the Supreme Court might moot the case by declaring the entirety of the ACA unconstitutional. Now, one would expect the Fifth Circuit to issue its opinion in due course. (There have been no new docket entries since early April.)