Supreme Court upholds most of Affordable Care Act; elements specific to pharmaceuticals are left untouched

Gallons of ink, and trillions of pixels, will be consumed in weeks to come dissecting the elements of the Supreme Court’s 5-4 ruling upholding the key section of the Patient Protection and Affordable Care Act of 2010 (ACA). But, for better or worse, the sections affecting pharmaceutical industry practices, and drug markets, are essentially unaffected: the deal that kept imported pharmaceuticals (independent of a manufacturer doing so) off the US market, in return for a 10-year, $85-billion discount for drugs sold to Medicare recipients; the Physicians’ Sunshine Act section, which set up “aggregate spend” reporting rules for payments by industry to healthcare providers; and funding for comparative effectiveness studies, to name a few. The Medicare discount was brokered by then-PhRMA president, Billy Tauzin, (who left PhRMA shortly after the law was passed). The current president, John Castellani, issued a statement when the Supreme Court decision was handed down saying, “We will work with Congress and the Administration on a bipartisan basis to address these important issues and will continue to advocate for an environment that fosters medical innovation and access to new medicines. We will also continue to work for necessary changes to the Affordable Care Act, such as the repeal of the Independent Payment Advisory Board (IPAB).” (IPAB is a controversial program to address pharmaceutical pricing by federal agencies.)

Meanwhile, the vegetable broccoli might never be viewed the same way again. All three versions of the Supreme Court decision (Robert’s majority opinion, the four dissenting Justices’ opinion, and the concurring opinion of Justice Ginzberg) brought up the humble plant in intricate arguments over the application of the Commerce Clause to the healthcare mandate. During oral arguments for the case last spring, Justice Scalia made the rhetorical comment, “… you can make people buy broccoli,” as a way of questioning the government’s power to compel the purchase of health insurance. Ginzburg called this the “broccoli horrible” argument, countering that “Although an individual might buy a . . . crown of broccoli one day, there is no certainty she will ever do so”—unlike healthcare, which, sooner or later, is needed by nearly everyone, and is frequently offered regardless of the ability to pay. The interpretation of the Commerce Clause, and its effect on the healthcare mandate, is likely to continue throughout the election season and beyond.