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Proposed Rules Released for Affordable Insurance Exchanges while Eleventh Circuit Court of Appeals Court Rules Individual Mandate Unconstitutional

Legal Services
08.12.11

Three proposed rules for the establishment of Affordable Insurance Exchanges – intended to create competitive marketplaces for private health insurance and a key component of the healthcare reform legislation enacted in March 2010 – were released today by Departments of Health and Human Services and Treasury.

In a press release, Treasury Secretary Tim Geithner said the proposed rules, which focus on access, eligibility, and premium tax credits, were a significant step toward "achieving one of the signature goals of the Affordable Care Act – to provide tens of millions of Americans with access to affordable health insurance coverage."

CMS will be accepting comments on the proposed rules for 75 days following publication in the Federal Register on August 17. HHS Secretary Kathleen Sebelius also issued a letter to state governors encouraging feedback on the proposed rules. Additionally, it was announced that public forums on the establishment of Affordable Insurance Exchanges will be held during the comment period in six cities across the country.

Only hours after the proposed rules were issued, the U.S. Court of Appeals for the Eleventh Circuit held that the individual mandate provision of the Affordable Care Act requiring Americans to purchase health insurance was unconstitutional. Calling the individual mandate "a wholly novel and potentially unbounded assertion of congressional authority," the Court stated that it could find no "judicially enforceable limiting principle that would permit us to uphold the mandate without obliterating the boundaries inherent in the system of enumerated congressional powers." The Eleventh Circuit did, however, rule that despite the unconstitutionality of the individual mandate, the balance of the Affordable Care Act could remain in place. Following the June 2011 ruling by the U.S. Court of Appeals for the Sixth Circuit, which upheld the constitutionality of the individual mandate, it is expected that the question will ultimately be decided by the Supreme Court.

For more information, please contact Paul Davidson or any member of the Waller Lansden Healthcare Department at 1-800-487-6380.

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