The U.S. Supreme Court is debating whether the Obama administration's Affordable Care Act is constitutional. How will that decision affect the development of health insurance exchanges?
Supreme Court is weighing in on the Obama administration's Affordable Care Act
(ACA), often called Obamacare, and a ruling could affect the development of
health insurance exchanges (HIXes), the Web health plan marketplaces that
resemble an Expedia or Travelocity.
At issue is
whether the Obama administration overstepped itself in passing the 2010 Patient
Protection and Affordable Care Act (PPACA)
and mandating that all
citizens purchase health insurance by 2014 or face a penalty. The court is
hearing arguments March 26 to 28. It could rule this week on the ACA or wait
until June, as experts predict.
Health Information Technology for Economic and Clinical Health (HITECH) Act,
which established an incentive program for health care programs to implement
"meaningful use" of electronic health records (EHRs), is unrelated to
for EHRs, as well as health information exchanges [HIEs], would be left
unaffected because they are both discussed in HITECH and ARRA," Shahid
Shah, CEO of IT consulting firm Netspective Communications and author of
the Healthcare IT Guy blog
, told eWEEK
in an email. ARRA is Obama's 2009 economic stimulus package,
called the American Recovery and Reinvestment Act.
In arguments March
27, the court appeared divided along party lines on whether the ACA is
constitutional. Justice Ruth Bader Ginsburg voiced support for the insurance
mandate in hearings, while Justice Anthony Kennedy dissented. The government
requiring individuals to purchase health insurance "threatens to change
the relationship between the government and the individual in a profound
way," said Kennedy.
states and the National Federation of Independent Business are challenging the
ACA. They argue that it violates constitutional rules on federalism and
individual rights, according to the Healthcare Information and Management
Systems Society (HIMSS
Commerce and HIXes
Clause of the Constitution rules that Congress is the branch of government that
regulates commerce, and the states are arguing that the administration's ACA
violates this clause by mandating that states be forced to implement HIXes. All
states must set up HIXes by 2014, according to the ACA. If states are no longer
required to set up the HIXes, the exchanges may not take off.
According to a
March 26 Harris Interactive poll, 51 percent of the public would like to see
this mandate to purchase insurance repealed. In the survey, Americans were
split on whether they support the ACA overall. Of those polled, 36 percent
support it, 41 percent oppose it and 23 are unsure.
implementing Travelocity-like HIXes powered by technology from companies such
as Adobe, Microsoft and Oracle.
The Adobe Digital Enterprise Platform (ADEP)
Adobe's PDF reader to produce welcome kits and digital signatures for health
insurers that offer plans in the Web-based exchanges.
Meanwhile, Oracle's HIX platform
includes a built-in rules
engine to allow states to meet federal eligibility requirements. The Oracle
platform is built on the Fusion Middleware application infrastructure.
Microsoft's HIX platform
allows states to
determine enrollment and eligibility, and it provides tools for business
intelligence and case coordination.
vendors have been introducing software that allows health care companies to get
reimbursed for expenses based on quality of care, or outcomes, rather than
getting paid per visit.
Changes to the
ACA could also affect the extension of the Physician Quality Reporting Initiative
(PQRI), which provides incentives to physicians who report data on quality
measures, suggested Richard Hodge, senior director of congressional affairs for
HIMSS, in a blog post
. PQRI is extended through 2014 under
Under the law,
doctors would also form accountable care organizations (ACOs), and the
government would offer incentives
to providers in ACOs that meet
The ACA as a
whole is unlikely to be ruled unconstitutional, but the mandate for buying
insurance could be, said Shah. Business models for HIX platforms may need to be
tweaked if individuals and small businesses aren't required to buy health
insurance, he noted.
insurance mandates are unconstitutional, then the demand side for HIXes goes
away, and the government would need to figure out where to get the money for
exchanges," said Shah. "I think HIXes could still survive, but they'd
need to be reworked quite a bit."
He noted that
the government may raise taxes on businesses to pay for Web-based HIXes without
a mandate for citizens to join.