Associated Press/Los Angeles Times: Federal judges torn over Obama’s healthcare law

A conservative-leaning appellate panel is concerned about the insurance mandate but says legal challenges may be premature.,0,6511276,print.story

Associated Press

5:41 PM PDT, September 23, 2011

Reporting from Washington

A conservative-leaning panel of federal appellate judges raised concerns about President Obama’s healthcare overhaul Friday, but suggested the challenge to it may be premature.

The arguments at the U.S. Court of Appeals in Washington over a lawsuit against Obama’s signature domestic legislative achievement focused on whether Congress overstepped its authority in requiring people to buy health insurance or pay a penalty on their taxes beginning in 2014.

But Judge Brett Kavanaugh, a former top aide to George W. Bush who was appointed to the bench by the former president, said he has a “major concern” that courts might not be able to rule on the law’s constitutionality until 2015. That’s because a federal law bars most challenges to tax-related legislation before the tax or penalty is paid.

A federal appeals court in Richmond, Va., cited that law in throwing out another challenge to the overhaul. Two other appeals courts have reached differing conclusions — one declaring the law unconstitutional and the other upholding it. The Supreme Court is expected to weigh in and could decide to review the law before the Washington circuit issues an opinion.

The Washington case was brought by the American Center for Law and Justice, a legal group founded by evangelist Pat Robertson, on behalf of five Americans who chose not to buy health insurance because of religious beliefs that God heals their afflictions or because they have a holistic approach to medical care. Their attorney, Edward White, told the appellate judges that one of the plaintiffs, Charles Edward Lee of San Antonio, is so devoted to faith healing that he hasn’t been to a doctor in 20 years and has told his family that even if he has a heart attack or is hit by a car just to pray for him and not seek medical care.

White argued that the healthcare act passed by Congress is unconstitutional. “Congress cannot force people into private commerce and to buy a private product for the rest of their lives,” White said.

But Kavanaugh pointed out that Congress has the power to regulate commerce and can require insurance companies to cover all Americans. “It won’t work without an individual mandate attached to it,” Kavanaugh said. He also theorized that the healthcare law could mark the shift in the social safety net to private industry. “Why should the court risk getting in the middle of that?” the judge questioned.

But later, when questioning government attorney Beth Brinkmann, Kavanaugh and the panel’s other Republican-appointed judge, Laurence Silberman, expressed concern that if the court upholds the requirement to buy health insurance, Congress could require Americans to buy a wide variety of other products. Kavanaugh said that could include individual retirement accounts to replace Social Security, and Silberman wondered whether wealthy Americans could be required to buy a car from General Motors if the company fell toward bankruptcy again.

Brinkmann responded that the government wasn’t requiring Americans to buy healthcare for the product’s own sake, but to finance the system as part of an expanded regulatory scheme.

A requirement to buy a product “has never been done in 222 years,” Kavanaugh said. “That alone is cause for judicial hesitation.”

Los Angeles Times: Appeals court dismisses challenges to health reform law,0,6854934.story?track=rss

By David G. Savage

 Washington Bureau

 September 8, 2011 

A federal appeals court in Virginia on Thursday rejected two conservative challenges to President Obama’s healthcare law, ruling that the legal dispute over the mandate to have insurance cannot be decided by judges until after 2014 when the tax penalty takes effect.

The first decision overruled a Virginia judge, who was the first to declare the healthcare law unconstitutional, and it threw out the suit brought by Virginia Atty. Gen. Kenneth Cuccinelli on the grounds that he had no standing to sue in the first place.

But the second decision could change the brewing legal battle over the healthcare law, which appears headed for a Supreme Court showdown early next year.

Chief Judge Diana Gribbon Motz of the U.S. 4th Circuit Court of Appeals pointed to the heretofore ignored federal law known as the Anti-Injunction Act, which forbids taxpayers from challenging taxes in court prior to paying the tax.

Beginning in 2014, a taxpayer who has a taxable income but does not have health insurance will be assessed a penalty of $95. The penalty would rise to $325 in 2015 and $695 in 2016. Lawyers for Liberty University in Lynchburg, Va., filed suit the day Obama signed the healthcare overhaul into law, contending the mandate to have insurance was unconstitutional.

But Motz said the law barred her and other judges from ruling on the issue before the tax takes effect.

“Because this suit constitutes a pre-enforcement action seeking to restrain the assessment of a tax, the Anti-Injunction Act strips us of jurisdiction,” she said in Liberty University vs. Geithner. “By its terms the AIA bars suits seeking to restrain the assessment or collection of a tax. … A taxpayer can always pay an assessment, seek a refund directly from the IRS, and then bring a refund action in federal court,” she said.

Before Thursday’s decision, the federal appeals courts had split on the constitutional issue. The 6th Circuit Court of Appeals in Ohio upheld the law in a 2-1 decision, and the 11th Circuit in Atlanta struck it down in a 2-1 decision.

The challengers in the Ohio case have already filed an appeal with the Supreme Court urging the justices to decide the question.

The 4th Circuit ruling could complicate the matter by raising doubt as to whether any judges, including the high court, have jurisdiction until the tax penalty takes effect in three years.

Los Angeles Times: Healthcare costs rose while insurance coverage fell, studies show

The changes have left nearly half the working-age population without enough protection from illness. Altogether, 44% of American adults were either uninsured or underinsured last year, according to the Commonwealth Fund.,0,343767.story

By Noam N. Levey, Los Angeles Times

September 8, 2011

Reporting from Washington – U.S. workers whose wages stagnated over the last decade also saw their health insurance degrade, even as medical costs gobbled up a growing share of their income, two new studies show.

An estimated 29 million adults who had health insurance lacked adequate coverage in 2010, leaving them exposed to medical expenses such as high deductibles that they couldn’t afford, according to a survey by the nonprofit Commonwealth Fund.

That is up from 16 million underinsured people in 2003, the survey found, underscoring the rising burden that insurance plans are placing on consumers as the industry raises required co-pays and deductibles.

“Underinsured families are at nearly as high risk as the uninsured because, while they have health insurance, holes or limits in their plans expose them to often unaffordable medical costs,” said Commonwealth Fund Senior Vice President Cathy Schoen, lead author of the new report, which was published in the journal Health Affairs.

More workers also simply lost coverage over the last decade, the survey found. Fifty-two million adults ages 19 to 64 did not have insurance at some point in 2010, up from 46 million in 2003.

That has left nearly half the working-age population without enough protection from illness. Altogether, 44% of U.S. adults were either uninsured or underinsured last year, according to the Commonwealth Fund.

Children and seniors are more likely to have insurance because many qualify for public programs such as Medicare and Medicaid.

The erosion in insurance coverage, which hit middle- and low-income Americans hardest, meant higher medical bills for U.S. families. The typical family of four with employer-based coverage saw its total monthly healthcare tab almost double between 1999 and 2009 — from $805 to $1,420 — researchers at the Rand Corp. found.

Over the same period, total monthly income grew only 30%, barely keeping pace with inflation, which pushed up prices 29% over the decade.

“Even a typical family with employer-provided insurance is just barely treading water,” said David Auerbach, the lead author of the study, also published in Health Affairs.

Rising out-of-pocket medical bills were so corrosive, the study found, that they virtually wiped out income gains over the decade, leaving the typical family with just $95 more a month to spend on things other than healthcare in 2009, compared with 1999.

Some of the increased healthcare burden came from higher insurance premiums and increases for co-payments and deductibles.

But the Rand researchers calculated that families were also paying more indirectly. Employers spent more on health benefits, rather than offering their workers bigger paychecks.

Families took yet another hit as the share of their state and federal tax bills that went to support government healthcare programs such as Medicare and Medicaid also rose over the decade.

The Rand and Commonwealth Fund researchers said the new healthcare law that President Obama signed last year could bring some relief, particularly to Americans without adequate insurance who will qualify for subsidized insurance starting in 2014.

That could reduce the number of underinsured adults as much as 70%, the Commonwealth report concluded.

While projected Medicare savings will help offset some of the costs of providing subsidies to millions of Americans, however, new tax hikes built into the law could also indirectly further inflate the typical household’s medical tab.

Los Angeles Times: ERs are becoming costly destinations for mentally disturbed patients

Budget cuts are creating added safety risks at hospitals and placing a burden on already crowded emergency rooms.,0,3817154.story

By Anna Gorman, Los Angeles Times

September 5, 2011

A man hearing voices walked into the emergency room of downtown’s California Hospital Medical Center on a recent night and said he wanted to hurt somebody. Doctors gave him medication, put him in a hospital bed and called the Los Angeles County Mental Health Department.

A mental health worker placed the patient — who had a history of schizophrenia — on a psychiatric hold. But despite multiple attempts to find somewhere to treat him, he spent 3 1/2 days in the emergency room.

With a sharp decrease in psychiatric beds and with mental health staffs spread thin across the state, emergency rooms increasingly have become costly and ineffective baby-sitting services for mentally disturbed patients in crisis.

The economic downturn and budget cuts are exacerbating a chronic problem, creating added safety risks at hospitals and placing a burden on already crowded emergency rooms. Meanwhile, hospitals are increasingly facing a dilemma: They can’t find proper facilities to care for the patients yet can’t release them to the streets.

“We are inundated with these patients,” said Marc Futernick, California Hospital’s director of emergency services. “The design of the system is that everyone gets taken care of in a timely fashion. The system is broken.”

That breakdown can be costly. Hospitals get stuck caring for uninsured psychiatric patients; the public has fewer emergency room beds available; and the mentally ill often do not get the therapy and medication they need.

“It’s a public safety, a public health and a humanitarian issue,” said Brian Johnston, director of emergency services at White Memorial Medical Center. “This has been going on for years, but it has become more acute because there are even fewer beds and even fewer dollars.”

California has roughly 6,500 acute in-patient psychiatric beds, down from 8,500 in 1996, according to the California Hospital Assn. And between 2009 and 2011, the state cut funding for services for the mentally ill by 16%, or nearly $587 million, according to the National Alliance on Mental Illness.

“There has been a wholesale reduction across the state for crisis services for individuals with mental illness,” said Sheree Kruckenberg, vice president of behavioral health at the California Hospital Assn. “The default in many communities is the only 24/7 provider, an emergency room.”

In Los Angeles, uninsured psychiatric patients walk into emergency rooms or arrive by ambulance or police car. If the hospital doesn’t have psychiatric services — and most don’t — a doctor will ask the county mental health department to dispatch an evaluation team. Patients who are a danger to themselves or others, or are gravely disabled, may then be placed on a 72-hour holds. When the process works smoothly, the patients are then transferred to psychiatric facilities for treatment.

But in many cases, that doesn’t happen. The evaluation teams sometimes take more than 24 hours to respond, doctors say, exceeding hospitals’ legal authority to hold psychiatric patients. Even when teams show up and place a hold on the patient, there often isn’t space at psychiatric facilities, and the patient remains stranded in an emergency room until the hold expires, officials say.

A recent change in L.A. County mental health procedures could make the emergency room logjam even worse, according to hospitals and emergency physicians.

As of Aug. 1, county psychiatric evaluation teams are responding to emergency rooms only when they are not needed on what are considered more urgent calls — to homes, schools or in the community. Kathleen Piche, spokeswoman for the county’s mental health department, said the agency is adding staff but that the number of calls has increased and has stretched those resources.

“We are responding to emergency rooms as resources allow, but our highest priority are field calls,” Piche said.

The department originally planned to stop sending the teams to emergency rooms altogether but backed down when hospitals protested. Legally, the county is not required to send evaluation teams to hospitals, Piche said, and hospitals should rely less on the county and hire their own psychiatrists. They also could contract with private facilities to get uninsured patients evaluated and transferred, she said.

But emergency room physicians disagree. The county has a financial and ethical responsibility to evaluate and care for uninsured mentally ill patients, Futernick said. “They are shirking their responsibility for patients who are in dire need of acute psychiatric treatment,” he said.

For California Hospital, where 85% of the patients are uninsured or on Medi-Cal, contracts with private psychiatric facilities would be prohibitively expensive — at least $7 million annually, Futernick said. And often they don’t take uninsured patients.

In the case of the man hearing voices, a county mental health worker arrived within 24 hours to place a hold but didn’t find a bed for him, Futernick said. Hospital administrators also made their own effort to find a psychiatric facility for the uninsured patient but were not successful, he said.

Wally Ghurabi, medical director of the emergency center at Santa Monica UCLA Medical Center, said he faces a dilemma: He can’t violate the law by keeping patients longer than 24 hours but he also can’t morally release dangerous patients back into the community. The mentally ill patients are a “burden on all ERs in L.A.,” Ghurabi said. They “occupy a bed that could be utilized by your mother or my sister when they have a heart attack.”

Keeping uninsured psychiatric patients in the ER is also expensive: in addition to the bed and the nursing care, hospitals often pay sitters to make sure the patients don’t leave.

Using technology to do assessments remotely could ease the burden on county evaluation teams, said Jaime Garcia, regional vice president of the Hospital Assn. of Southern California. But the real solution is more funding and more beds for mentally ill patients, doctors say.

There are 170 county-owned psychiatric beds and nearly 2,000 private beds in Los Angeles County, but they are often filled, according to the mental health department.

Beyond the resource issue, emergency rooms simply aren’t equipped to handle patients with schizophrenia, bipolar disorder and other mental illnesses, said Randall Hagar, director of government affairs for the California Psychiatric Assn.

“People with a mental illness really need a calm, quiet atmosphere when they are in crisis,” he said. “Instead … they are put in places that were not designed to address the needs of people with mental illness.”