This Week in Washington-July 6, 2012

It’s hot!  Way too hot!  The DC area is in a historic heat wave.  According to the Capitol Weather Gang, this is the 9th straight day DC has seen temperatures over 95° F.  We hit a record temperature (104° F) on June 29th, and the weather forecasters are predicting that we may hit another record on Saturday, July 7th. In the midst of the heat wave, on June 29th severe storms hit the Washington DC area, knocking out power to millions of people in the region. The GRD building sustained no damage, but a few of our employee’s homes are still without power.

Fortunately, with the Independence Day holiday and Congress in recess, this is a quiet week in our Nation’s Capital.  Washington (and the Nation) is still abuzz over the Supreme Court’s decision on the Affordable Care Act last week. On the day that President Obama signed the Affordable Care Act into law, the state of Florida (joined by 25 other states) filed a lawsuit in federal district court challenging the constitutionality of the individual mandate and the Medicaid expansion.  The individual mandate requires most Americans to have minimal essential health insurance coverage for themselves and their tax dependents beginning in 2014.  If an individual does not satisfy the requirements of the individual mandate, he/she will owe a shared responsibility payment, which will be assessed and collected by the IRS.  AFA also expanded the Medicaid program, expanding eligibility of the program for Medicaid benefits.  AFA permits the Secretary of Health and Human Services to penalize states who do not take part in the expansion by withholding their existing Medicaid funding.

The decision had multiple parts.  Before looking at the merits of the case, the Court had to determine if they had the authority to do so.  As mentioned previously, beginning in 2014 the shared responsibility payment is assessed and collected by the IRS, and hence could be considered a tax. Under the “Anti-Injunction Act”, the lawlessness of a tax cannot be challenged in court until the tax has been imposed and paid.  The Court ruled that they have the jurisdiction to rule on the case now because Congress had chosen to describe the shared responsibility payment not as a tax, but as a penalty.  The Court concluded that: “The Affordable Care Act describes the payment as a “penalty,” not a “tax.” That label cannot control whether the payment is a tax for purposes of the Constitution, but it does determine the application of the Anti-Injunction Act. The Anti-Injunction Act therefore does not bar this suit.”

The Court upheld the constitutionality of the individual mandate through Congress’s power to” lay and collect taxes.”  The Court concluded: “The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness.”

On the Medicaid question, the Court  determined that the “Medicaid expansion violates the Constitution by threatening States with the loss of their existing Medicaid funding if they decline to comply with the expansion. “  The expansion exceeds Congress’ authority under the Spending Clause of the constitution because it is impermissibly coercive.  The Court’s remedy is to limit the HHS Secretary’s power to withhold existing federal Medicaid funds for state non-compliance with Medicaid expansion.

The Court’s decision surprised many people because the normally conservative Chief Justice Roberts sided with the more liberal block of the Supreme Court in upholding the constitutionality of the individual mandate.  The vote was 5-4.    The Kaiser Family Foundation has additional information about the Court’s decision as well as information about the implementation of the Affordable Care Act.

Also this week, the House Agriculture Committee released its draft 2012 Farm Bill, which is expected to be marked-up by the Committee on July 11th. As with the Senate passed bill , the House bill authorizes the Veterinary Services Grant Program to address needs in rural agricultural areas. The underlying legislation for this provision was the Veterinary Services Investment Act, a high priority for the AVMA.  The House bill also reauthorizes the Veterinary Medicine Loan Repayment Program and the Food Animal Residue Avoidance Databank.

That’s all for now… to Schaumburg for the AVMA Summit on Governance.

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