A quick summary of how the Supreme Court decision on Chevron impacts health care

On Friday, June 28, the Supreme Court rescinded the Chevron deference doctrine, which required judges to defer to agencies’ reasonable interpretations of ambiguous federal laws. This decision allows judges more freedom to impose their interpretations, potentially disrupting regulations on health care, the environment, financial regulations and technology. This decision could lead to delays in federal rulemaking and increased litigation challenging these rules. Specifically, this decision may impact:

Medicare reimbursement: Without Chevron deference, providers can more readily challenge HHS and its sub-agencies’ reimbursement decisions for hospitals, prescription drugs and new coverage requirements.
Medicare and Medicaid coverage disputes: Federal courts previously gave significant weight to the U.S. Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS) interpretations of statutes like the Social Security Act and the Affordable Care Act. With Chevron overturned, disputes over statutory language are likely to increase, as beneficiaries and advocates seek favorable court interpretations.
Administration of Medicare and Medicaid: HHS and CMS will face challenges in administering Medicare and Medicaid. Congress may need to clarify statutes to ensure agency interpretations are enforced. Without agency discretion, litigation against these agencies could become more common and successful.
Nondiscrimination under the Affordable Care Act: Section 1557 of the Affordable Care Act (ACA) prohibits discrimination in health programs receiving federal assistance. Recent regulations interpreting this section, especially regarding sexual orientation, gender identity, and language proficiency, are now vulnerable. Courts will interpret ambiguous language without Chevron deference, challenging the agencies’ rules.
Health care fraud and abuse laws: The health care industry is regulated by laws like the Anti-Kickback Statute, Stark Act, False Claims Act and Civil Monetary Penalties Law. Agencies have historically provided guidance on these statutes, which courts upheld under Chevron. Without Chevron, providers may be more hesitant to disclose violations, and enforcement actions may decrease due to uncertainty about court support for agency interpretations.

The Supreme Court decision fundamentally shifts the balance of power between federal agencies and the judiciary, particularly affecting the health care sector by increasing the potential for legal challenges and requiring more precise statutory language from Congress. The AOA will continue to monitor how this decision impacts the osteopathic profession moving forward.